About Rule of 72 Calculator
Albert Einstein reputedly called compound interest "The eighth wonder of the world". The Rule of 72 is a famous mental math shortcut that lets you estimate the power of compound interest without a spreadsheet. It answers the question: "How long until my money doubles?"
The Magic Number
The math is surprisingly simple: Divide 72 by your annual interest rate. The result is the years to double.
- Inflation (3%): 72 / 3 = 24 years for prices to double (or your cash value to halve).
- Stock Market (Historical 10%): 72 / 10 = 7.2 years to double your portfolio.
- High-Risk Crypto (Assuming 50%??): 72 / 50 = 1.4 years (if it doesn't go to zero!).
The "Rule of 100" or "69"
For precise financial modeling (using logarithms), numbers like 69.3 are more accurate mathematically. However, 72 is chosen because it is highly divisible (by 2, 3, 4, 6, 8, 9, 12), making it perfect for mental math. The Rule of 72 is reasonably accurate for interest rates between 6% and 10%.
Using the Tool
Just input your expected Annual Rate of Return (%). The tool calculates the doubling horizon. It's a great reality check for "Get Rich Quick" schemes or retirement planning.