Rule Of 72

What Does Rule Of 72 Mean?
A rule stating that in order to find the number of years required to double your money at a given interest rate, you divide the compound return into 72. The result is the approximate number of years that it will take for your investment to double.

Investopedia explains Rule Of 72
For example, if you want to know how long it will take to double your money at 12% interest, divide 12 into 72 and you get six years.

Filed Under: Buzz Words, Personal Finance

Related Terms

Annual Percentage Yield - APY
Compound Interest
Compounding
Return
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