How Long Does It Take to Double $100K Using the Rule of 72?
Learn how to estimate the time it takes to double a $100,000 investment using the simple Rule of 72 formula.
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The Rule of 72 is a simple way to estimate how long it takes for an investment to double. Divide 72 by the annual interest rate. For example, if your $100k is growing at 6% annually, it will take about 12 years to double (72/6 = 12).
FAQs & Answers
- What is the Rule of 72? The Rule of 72 is a simple formula used to estimate the number of years required to double an investment at a fixed annual interest rate by dividing 72 by that rate.
- How long will it take to double $100,000 at 6% interest? Using the Rule of 72, it will take approximately 12 years to double $100,000 at a 6% annual interest rate (72 divided by 6 equals 12).
- Can the Rule of 72 be used for any interest rate? The Rule of 72 works best for interest rates between 6% and 10%; for very high or low rates, the estimate may be less accurate.