Reading 2021-08-14
Metadata
- Ref:: Interactive Mathematics
- Title:: Rule of 72
- Author::
- Year of publication:: 2018
- Category::
- Topic:: #topic.investment
Notes from reading
Here is a graph showing $1 doubling at different interest rates.
This is a trick that allows us to mentally estimate annual compound interest amounts, where we are interested in doubling our money
If we want to know how long it will take for our money to double, just divide 72 by the interest rate
So for example, if the interest rate is 10%,
72 รท 10 = 7.2 years
So it will take just over 7 years to double our money