Definition of

Rule of 72

Rule of 72
A way to estimate how long it takes to double the value of an investment.

You divide 72 by the interest rate to get the number of years.

Examples:
• For an annual rate of 8%, divide 72 by 8, for a result of 9 years. So at 8% it takes about 9 years to double your money.
• For an annual rate of 10%, divide 72 by 10, for a result of 7.2 years. So at 10% it takes about 7 years to double your money.

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