What is the Rule of 72?

The Rule of 72 is a quick way to estimate how long an investment takes to double. Divide 72 by the annual return as a percentage and you get the years to double. At 8% a year, money doubles in about 9 years.

How accurate is the Rule of 72?

It is a close approximation for rates between about 5% and 12%. This calculator also shows the exact figure using logarithms so you can see the small difference. For everyday planning the Rule of 72 is accurate enough.

Can I use it to find the rate?

Yes. If you want to double your money in a set number of years, divide 72 by the years to get the annual return you need. To double in 10 years you need about 7.2% a year.

Rule of 72 Calculator

The Rule of 72 Calculator gives you a fast way to see how compound growth affects your money over time, without a full compound interest formula. Enter an annual return as a percentage and it instantly returns two figures: the Rule of 72 estimate for how many years your money takes to double, and the exact number of years worked out using logarithms, so you can see how close the shortcut really is. There is also a reverse calculation: enter a target number of years and it tells you the annual return needed to double your money in that time. This makes it useful for two questions, how long an investment takes to double at a given rate, and what return you need for a doubling goal by a set year. The rule works by dividing 72 by the percentage return, or by the years for the reverse version, and it stays accurate for typical returns between about 5% and 12% a year, covering most savings accounts, term deposits, KiwiSaver funds and share portfolios. Use it to sanity check an investment pitch, compare how return rates change your timeline, or set a realistic savings or retirement goal. As a simplified approximation rather than a full compounding calculation, treat the result as an indicative guide for planning, not a guaranteed outcome, since actual returns fluctuate year to year.

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Years to double from a rate

Annual return

9 years

exact: 9.01 years

Rate needed to double in a set time

Years to double

7.2%

annual return needed

How the Rule of 72 works

Divide 72 by the annual return as a percentage to estimate the years to double. The reverse works too: divide 72 by the years to get the return you need. It is a shortcut for compound growth that is close enough for quick decisions without a calculator.

Worked example

At 8% a year, 72 divided by 8 is 9, so money doubles in about 9 years. The exact figure using logarithms is 9.01 years, so the rule is very close. At 6% it takes about 12 years, and at 12% about 6 years.

Related calculators

Compound Interest Calculator: full compound growth.
Investment Calculator: project an investment.
Savings Goal Calculator: reach a target.
Retirement Calculator: plan for retirement.

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