Rule of 72
How Fast Does
Your Money Double?
The Rule of 72 is the simplest mental math trick in investing โ divide 72 by your annual return to find exactly how many years it takes to double your money.
Rule of 72 Calculator
Enter interest rate โ get doubling time. Instant!
| Year | Amount | Doubles | Multiplier | Growth % |
|---|
Reverse Calculator
I want to double in N years โ what rate do I need?
Doubling Time Across Asset Classes
How fast do different investments double your money?
Rule of 72 โ Complete Guide
The most powerful mental math trick in investing
The Rule of 72
Divide 72 by your annual interest rate to get the approximate number of years it takes to double your money. It works for any investment โ FD, mutual fund, real estate, or even inflation eroding your savings.
Why 72? The Math Behind It
The exact formula for doubling time is ln(2)/ln(1+r) โ 0.693/r. Multiplying by 100 gives 69.3/rate%. The number 72 is used because it's divisible by many small numbers (2,3,4,6,8,9,12) โ making mental math easy. For rates 6โ10%, the error is less than 1%.
Rule of 72 for Inflation
The rule works in reverse for inflation โ it shows how quickly inflation halves your purchasing power. At 6% inflation: 72รท6 = 12 years for your money to lose half its value. This is why investing beats hoarding cash!
Rule of 70 vs Rule of 72
- Rule of 72: Most widely used, best for 6โ10% rates
- Rule of 70: Slightly more accurate for continuous compounding
- Rule of 69.3: Mathematically exact (ln 2 ร 100)
- For practical investing decisions: Rule of 72 is always accurate enough
Compound Doubling โ The 8th Wonder of the World
What makes the Rule of 72 so powerful is understanding how multiple doublings multiply wealth. At 12% CAGR (doubling every 6 years): โน1 lakh โ โน2L (6yr) โ โน4L (12yr) โ โน8L (18yr) โ โน16L (24yr) โ โน32L (30yr). Start investing early โ every 6-year delay costs you 50% of your final wealth!
Know Your CAGR
Find your investment's historical/expected annual return
Divide 72 by Rate
72 รท 12% = 6 years. That's it!
Plan Multiple Doublings
How many doublings fit in your investment horizon?
Maximize Rate
Higher rate โ faster doubling โ more final wealth
Rule of 72 Insights
How to use this rule to transform your investment thinking
Early Start = More Doublings = 10x More Wealth
Starting at 25 vs 35 gives 10 extra years at 12% CAGR. That's nearly 2 extra doubling cycles. Your corpus at 60 is 4x more if you start at 25 vs 35. Time is your most powerful asset.
Use Rule of 72 for Inflation Planning
At 6% inflation, your โน1 lakh loses half its purchasing power in 12 years. If you hold cash or keep money in savings account (4%), you're barely keeping up. This is why equity investment (12%+) is essential.
Reverse Rule: Target Doubling Time โ Required Rate
Want to double money in 5 years? Need 72รท5 = 14.4% annual return. Want to do it in 4 years? Need 18% CAGR. This tells you which asset class is realistic for your timeline.
The Cost of Fees in Doubling Time
1% extra fund expense ratio might seem small, but it's devastating over time. At 15% gross returns: 15% net โ doubles in 4.8yr. 14% net (1% expense) โ doubles in 5.1yr. Over 30 years, you lose nearly one full doubling cycle.
FD Doubles in 10 Years. Inflation Halves in 12.
At 7.5% FD rate, money doubles in ~10 years. But at 6% inflation, purchasing power halves in 12 years. FD barely beats inflation in nominal terms. After tax (30% bracket), FD at 5.25% post-tax barely keeps pace.
Compare Any Two Investments in Seconds
Rule of 72 lets you compare investments without any calculator. "This fund gives 15% vs that one at 12%." โ 15%: doubles in 4.8yr. 12%: doubles in 6yr. Over 24 years: 15% = 5 doublings (32x). 12% = 4 doublings (16x). 2ร more wealth!
Frequently Asked Questions
Answers to common questions about the doubling rule
Open Your Demat Account
Fill in your details โ our advisors will assist you within 24 hours.
๐ 256-bit encrypted & secure submission
Application Received!
Thank you, ! Your application is submitted. Our advisor will contact you within 24 hours.