The Rule of 72: How Fast Your Money Doubles

The Rule of 72 is a shortcut that lets you estimate how long it takes for an investment to double at a given rate of return. In this episode, Ryan explains the math: divide 72 by your rate of return, and the result is the number of years to double. At 7.2%, that is 10 years. At 6%, it is 12 years. At 9%, it is 8 years. No calculator needed.The rule is most accurate between 7% and 10% returns, which happens to be the range most relevant for long-term stock market investing. Ryan also shows how the same logic works in reverse: if a debt or inflation is running at a certain rate, the Rule of 72 tells you how fast it erodes your purchasing power. This episode pairs well with the prior compound interest episode and gives you a fast mental check for any compounding scenario.Find "Your Fiscal Physical" the book on AmazonIf you have suggestions or feedback, please email us at: [email protected], as always, Stay the Course!