Finance Dictionary
Rule of 72
A simple formula to estimate how long it takes an investment to double. Divide 72 by the annual interest rate to get approximate years to double.
Formula
Doubling Time ≈ 72 / Annual Return Rate (%)
Example
At 12% return, 72/12 = 6 years to double. At 6% (FD), 72/6 = 12 years to double.
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