Planning Briefs
Rely On The Rule Of 72 To Give You Quick Answers
Published Friday, May 24, 2013 at: 7:00 AM EDT
In the high-tech world we live in, it’s astonishing to think that a simple mathematical formula dating from the 15th century may still be useful to investors. It’s called the Rule of 72.
If you’re not familiar with the Rule of 72, it tells you how long it would take to double the money you’re investing or what return you’ll need to double your money during a specified time period. Either way, the magic number is 72.
The best way to explain this rule is to look at a couple of examples. (Keep in mind that the figures in these examples are hypothetical and don’t reflect any actual investment. The returns you earn will depend on market conditions.)
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