What is the 'Rule Of 70'
The rule of 70 is a way to estimate the number of years it takes for a certain variable to double. To estimate the number of years for a variable to double, take the number 70 and divide it by the growth rate of the variable. This rule is commonly used with an annual compound interest rate to quickly determine how long it takes to double your money.
BREAKING DOWN 'Rule Of 70'
Another useful application of the rule of 70 is in the area of estimating how long it would take a country's real GDP to double. Similar to calculating compound interest rates, a person can use the GDP growth rate in the divisor of the rule. For example, if the growth rate of China is 10%, the rule of 70 predicts it would take seven years, or 70/10, for China's real GDP to double.The rule of 70 is accepted as a way to manage exponential growth concepts without complex mathematical procedures. Also referred to as doubling time, it is most often related to items in the financial sector in instances when examining the potential growth rate of an investment. By dividing the number 70 by the expected rate of growth, or return in financial transactions, an estimate in years can be produced.
While it is not a precise estimate, the rule of 70 formula does help provide guidance when dealing with issues of compounding interest and exponential growth. This can be applied to any instrument where steady growth is expected over the long term, such as with population growth over time, but it is not well applied in instances where growth rate is anticipated to vary dramatically.
Rules of 72 and 69
In some instances, the rule of 72 or the rule of 69 is used. The function is the same as the rule of 70 but uses the number 72 or 69, respectively, in place of 70 in the calculations. While the rule of 69 is often considered more accurate when addressing continuously compounding processes, 72 may be more accurate for less frequent compounding intervals. Often, the rule of 70 is used simply because it may be easier to remember.
Rule of 70 vs. Real Growth
The population of the United States was estimated at 161 million in 1953, approximately doubling to 321 million in 2015. In 1953, the growth rate was listed as 1.66%. By the rule of 70, the population would have doubled by 1995. Changes to the growth rate lowered the average rate, making the rule of 70 calculation inaccurate.

Rule Of 72
A shortcut to estimate the number of years required to double ... 
Growth Rates
The amount of increase that a specific variable has gained within ... 
Effective Annual Interest Rate
Effective Annual Interest Rate is an investment's annual rate ... 
Exponential Growth
A pattern of increasing prices that resembles the curve of an ... 
Compound Interest
Compound Interest is interest calculated on the initial principal ... 
Uptick Rule
A former rule established by the SEC that requires that every ...

Investing
What is the Rule of 70?
The rule of 70 is an easy way to calculate how many years it will take for an investment to double in size. 
Markets
Explaining Growth Rates
Growth rate refers to the amount a specific variable or measure has grown over a specified time, whether related to one company or an entire economy. 
Managing Wealth
Learn Simple And Compound Interest
Interest is defined as the cost of borrowing money, and depending on how it is calculated, can be classified as simple interest or compound interest. 
Markets
How does Compound Interest Work?
A quick way to understand the impact of compound interest is to ask yourself if youâ€™d rather receive $100,000 a day for a month, or start with a penny on day one and double it every day for those ... 
Investing
Accelerating Returns With Continuous Compounding
Investopedia explains the natural log and exponential functions used to calculate this value. 
Retirement
Why Investors Should Care About Compound Interest
Learn about compounding interest and how it impacts savings decisions, debt management, investment strategies and retirement planning. 
Investing
The Days of Rule 48 Are Coming to An End
A look at the proposal to repeal the controversial Rule 48. 
Retirement
5 Top Ways to Double Your Investment
From risky manoeuvres to slowandsteady strategies, we look at five methods to double your money. 
Investing
Protect Your Gains From Volatility With These 3 Rules
It's been said that trading is the hardest way to make easy money. And after more than two decades in the markets, I wholeheartedly agree. The vast majority of investment advisors, brokers and ... 
Trading
The Uptick Rule Debate
This rule was deemed ineffective and repealed in 2007, but critics argue it protects the market from bear raids.

What is the difference between the rule of 70 and the rule of 72?
Find out more about the rule of 70 and the rule of 72, what the two rules measure and the main difference between them. Read Answer >> 
What can I use the Rule of 70 for?
Discover how the rule of 70 works, and learn about some of the different ways it can be applied to future forecasting and ... Read Answer >> 
How is the rule of 70 related to the growth rate of a variable?
Find out more about the rule of 70, what it is used for and how it is related to the growth rate of a variable. Read Answer >> 
What does the rule of 70 indicate about a country's future economic growth?
Find out more about the rule of 70, what it measures and what it indicates about a country's future economic growth rate. Read Answer >> 
How do I use the rule of 72 to calculate continuous compounding?
Find out why the rule of 72 does not accurately reflect the growth caused by continuous compounding, and which number can ... Read Answer >> 
How can I use the rule of 70 to estimate a country's GDP growth?
Find out about the rule of 70, what it is used for and how to use it to determine the number of years a country's GDP takes ... Read Answer >>