Guide

The Rule of 72: how long does it take money to double?

Last updated 10 October 2026 · By the calcisland editorial team

If you have ever heard “at 8% your money doubles in nine years”, you have met the Rule of 72. It is a mental shortcut: 72 ÷ annual rate (in percent) ≈ years to double. This guide checks how accurate it is, why it uses 72, how to stretch it to tripling and quadrupling, and how to point it at inflation and fees, where it is just as useful.

To check any case exactly, use the compound interest calculator.

How does the Rule of 72 work?

Rule of 72: years to double ≈ 72 ÷ r, where r is the annual growth rate in percent (6% → r = 6). Exact: years to double = ln 2 ÷ ln(1 + r ÷ 100), for growth compounded once a year.

Take 6% a year. The rule says 72 ÷ 6 = 12 years. The exact answer is ln 2 ÷ ln 1.06 = 11.9 years. You can confirm it in the compound interest calculator: principal 1,000, annual rate 6%, 12 years, compounding frequency Annually, contribution 0. The future value is 2,012.20, just over double the starting amount.

The investor education site Investor.gov, run by the US Securities and Exchange Commission, describes the same shortcut: divide 72 by the expected rate of return to approximate the years it takes an investment to double.

How accurate is the Rule of 72?

The table compares the rule with the exact answer for growth compounded once a year. A positive error means the rule says “longer” than the exact answer.

Three things stand out:

• The sweet spot is about 6% to 10%, where the error stays within roughly one percent. It is closest at 8%.
• At low rates the rule runs long, and at high rates it runs short. That is why some people switch to 70 below about 4%: at 2%, 70 ÷ 2 = 35.0 years, which matches the exact 35.0.
• Past 20% it is only a rough guide. At 30% the rule says 2.4 years and the exact answer is 2.6.

Why 72 and not 69.3?

The exact “doubling constant” is ln 2 = 0.693, so for continuous compounding the rule would be 69.3 ÷ r. With once-a-year compounding the exact constant (rate × exact years) is about 69.7 at 1%, 72.1 at 8% and 72.7 at 10%, so 72 fits the middle of the range. It also has a practical advantage: it divides evenly by 2, 3, 4, 6, 8, 9 and 12, so the common rates give clean answers (72 ÷ 9 = 8, 72 ÷ 12 = 6).

Compounding more often than once a year changes the exact answer slightly. At 6% a year compounded monthly (0.5% a month), doubling takes 139 months, or 11 years and 7 months, a little sooner than the 11.9 years of annual compounding. The rule is a quick estimate, not a replacement for the exact calculation.

How do you use the Rule of 72 backwards?

If you know the time and want the rate, divide 72 by the years. To double in 10 years you need about 72 ÷ 10 = 7.2% a year. The exact rate is 7.18%.

Can you triple or quadruple with it?

Yes, with adjusted numbers. Use 114 to triple and 144 to quadruple (two doublings: 2 × 72).

What about inflation and fees?

The rule does not care whether the rate helps or hurts you. Applied to a cost, it tells you how long until the cost doubles, or until purchasing power halves:

• Inflation. At a steady 3% a year, prices double in about 72 ÷ 3 = 24 years (exact 23.4). Put another way, the purchasing power of cash that earns nothing halves in under 24 years. Inflation does not stay at 3%, so treat this as an illustration, not a forecast.
• Fees. Suppose an investment grows 6% a year before fees. Without a fee it doubles in about 12 years (exact 11.9). A 1.5% yearly fee that comes out of the return leaves 4.5%, so doubling takes 72 ÷ 4.5 = 16 years (exact 15.7), roughly four years longer. Our guide to FX conversion costs shows how small percentage costs add up the same way.

When does the Rule of 72 break down?

• Regular contributions. It describes one lump sum. Adding money each month shortens the time to double. Use the calculator for that.
• Returns that move. Real returns vary. Use the compound (geometric) average, not the simple average, and expect the actual doubling time to differ.
• Taxes and fees. Use the rate after fees, and after tax if the growth is taxed each year.
• Nominal vs real. A 6% return with 3% inflation is about a 2.9% real return, which doubles your purchasing power in roughly 24 years, not 12. To see growth after inflation, use the real rate.

For the maths behind the growth itself, read how compound interest works.

FAQ

Does the Rule of 72 work for contributions every month?

No. It only describes one lump sum growing at a steady rate with nothing added or taken out. Regular contributions make the balance grow faster than the rule suggests, so use the compound interest calculator when you add money each period.

Is the Rule of 72 the same for simple interest?

No. With simple interest the interest is never added to the base, so money doubles after 100 divided by the rate years, for example 25 years at 4%. The Rule of 72 is a shortcut for compound growth.

Can I use it when the return changes from year to year?

Only as a rough guide. Use the average compound (geometric) rate, not the simple average of the yearly returns. A fund that gains 20% and then loses 20% has not broken even: 1.2 × 0.8 = 0.96.

Should I use 72, 70 or 69.3?

For everyday mental maths at 6% to 10%, use 72. Below about 4%, 70 is slightly closer. 69.3, which comes from the natural logarithm of 2, is the best fit only when interest is compounded continuously.

Sources

Checked on 2026-10-10. Every figure in the tables was computed in Python from the exact formula; the 1,000 at 6% for 12 years example matches the compound interest calculator (2,012.20).

• Investor.gov (US SEC), What is compound interest? (the Rule of 72 as a way to estimate how long an investment takes to double)

Related: how compound interest works and the compound interest calculator.

This article explains the maths for general education. It is not financial advice. See the disclaimer.

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