Rule of 72 Calculator
A Mental-Math Shortcut That Still Holds Up
Before spreadsheets, investors needed a fast way to estimate how long money would take to double at a given compound rate, without solving a logarithm by hand. The Rule of 72 is that shortcut — dividing 72 by the interest rate produces a close approximation of the doubling time in years, accurate to within a few months across the range of rates most savers and investors actually encounter.
The Formula
The constant 72 is chosen because it divides evenly by many common small numbers — 2, 3, 4, 6, 8, 9, 12 — making it easy to compute without a calculator, while still closely approximating the true compound-growth doubling time given by ln(2) ÷ ln(1 + r).
Where This Matters
- Comparing investment options quickly — seeing that a 6% return doubles money in 12 years versus 9 years at 8% makes the impact of rate differences tangible without running a full compound interest formula.
- Understanding debt growth — the same rule applies in reverse to a credit card balance accruing interest, showing how quickly unpaid debt can double.
- Inflation's erosion of purchasing power — applying the rule to an inflation rate shows how long it takes prices to double, and by extension how long it takes savings to lose half their real value.
| Annual rate | Years to double (Rule of 72) |
|---|---|
| 2% | 36.0 |
| 4% | 18.0 |
| 6% | 12.0 |
| 8% | 9.0 |
| 10% | 7.2 |
| 12% | 6.0 |
The approximation is most accurate for rates between roughly 6% and 10%; at very high or very low rates it drifts slightly from the exact compound-growth figure.
How to Use This Calculator
- Enter the annual interest rate as a percentage.
- Select Calculate to see the estimated number of years for the amount to double.
Related Calculations
See the Rule of 70 Calculator for the variant more commonly used for economic growth rates, or the Future Value Calculator for an exact compound-growth projection rather than an approximation.