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Rule of 72

Rule of 72

The rule of 72 is a simple trick to quickly estimate how long a certain interest rate will take to double an investment. You can divide either the interest rate needed or the desired number of years into 72 and get a fairly accurate estimate of what  the other quantity would need to be to double your investment.
Example: Your interest rate is 8%. 72 ∕ 8 = 9, so it will take about 9 years to double your money.

The basic algebraic formula looks like this, where Y is the number of years and r is the interest rate:

Y = 72 ∕ r and r = 72 ∕ Y


This rule works is valid for interest rates between 4% and 20%. Outside of that range, errors become significant and the estimate is less accurate. However, inside of that range, the estimate is highly accurate. Use the calculators below to estimate either the number of years a certain interest rate would take to double an investment or the interest rate necessary to double an investment within a certain number of years. Learn more about the Rule of 72 in this article.

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