How this number is made
The rule of 72 says years to double is about 72 divided by the percent return. It is an approximation of compound growth. This page also shows the exact time, ln(2) ÷ ln(1 + rate).
- Type the annual return as a percent, not a decimal.
- The rule gets worse at very high and very low rates. The exact line is the check.
Formula
Rule of 72: years ≈ 72 ÷ percent. Exact: years = ln(2) ÷ ln(1 + rate).
Worked example
With the figures already in the form, years to double, rule of 72 is 9.0.
Questions
Why 72?
It is a convenient number close to 100 × ln(2), and it divides cleanly. It is a memory trick, which is why the exact line is next to it.
Does this include additions?
No. It is one lump sum left alone.