The Rule of 72 is a method that’ll tell you how long it’ll take to double your money, given a fixed rate of return.

## What’s the Rule of 72?

If you have a fixed annual interest rate, then you can use the Rule of 72 to figure out how long an investment will take to double. It’s a method where you divide 72 by the annual interest rate.

**Related:** Stock exchange hours around the world

Although it’s not completely accurate, the method will give you a good idea of the time frame. It can be off by a year or less.

However, it’s a useful shortcut because of how close you can get without having to calculate it using a formula for compound interest. Equations for compound interest will most likely require a calculator.

For example, an investment may offer 6% as the annual rate of return. To figure out how long it’ll take to double, divide 72 by 6, and you’ll get 12 (72/6 = 12). That means it’ll take 12 years for your investment to double.

The Rule of 72 works for any loan or investment that earns or charges compound interest.

**More resources:**

- The complete guide to penny stocks
- How to invest in index funds
- 10 must-follow financial tips for young adults

*Featured graphic by David Em/More Money More Choices.*

## David Em

Founder and Chief Editor

David Em is the Founder and Chief Editor of More Money More Choices. He launched the site in 2019 to empower individuals for financial health. David has a finance and leadership background. It enables him to share practical money management and growth tips and advice.