The Rule of 72 is a simple mental shortcut: divide 72 by your expected annual return to estimate how many years it takes your money to double. At a 7% annual return, your money doubles in about 10.3 years (72 ÷ 7 = 10.3). It’s not exact, but it’s accurate enough for planning — and it’s the fastest way to feel what compound growth can do.
Try it on our Rule of 72 calculator — it does the same math instantly for any rate or time horizon.
How the Rule of 72 works
The math is one line: 72 ÷ annual return = years to double.
- At 4% return: 72 ÷ 4 = 18 years
- At 7% return: 72 ÷ 7 ≈ 10.3 years
- At 10% return: 72 ÷ 10 = 7.2 years
You can also run it backwards: 72 ÷ years to double = the return you need. If you want your money to double in 10 years, you need roughly a 7.2% annual return (72 ÷ 10).
Rule of 72 vs exact math
The rule is an approximation. It works because 72 sits close to the natural-growth constant that links rates to doubling time, and it’s easy to divide in your head. It’s most accurate for returns between about 5% and 12% — exactly the range most long-term investors plan with.
| Annual return | Rule of 72 | Exact years | Close? |
|---|---|---|---|
| 4% | 18.0 | 17.7 | Very close |
| 5% | 14.4 | 14.2 | Very close |
| 6% | 12.0 | 11.9 | Almost exact |
| 7% | 10.3 | 10.2 | Almost exact |
| 8% | 9.0 | 9.0 | Almost exact |
| 9% | 8.0 | 8.0 | Almost exact |
| 10% | 7.2 | 7.3 | Very close |
| 12% | 6.0 | 6.1 | Very close |
For returns much lower (say 2%) or much higher (15%+), the rule drifts a little — but for everyday planning it’s good enough to tell you whether an investment is on track to double within your time horizon.
Why it matters for your plan
The Rule of 72 makes compound growth tangible. If you’re 35 and your portfolio doubles roughly every 10 years at a 7% return, it can double about three times by the time you’re 65 — so $10,000 becomes around $80,000 before you add a single extra dollar. Doubling time is the real engine of long-term wealth.
For plans with regular contributions, doubling alone isn’t the full picture — use our Compound Interest calculator to model contributions and growth together.
Frequently asked questions
Is the Rule of 72 accurate?
For annual returns between about 5% and 12%, it’s accurate to within a few months. Outside that range it drifts slightly, but it’s still a useful planning approximation.
Why 72 and not 70?
72 was chosen because it’s divisible by many common return rates (2, 3, 4, 6, 8, 9, 12), which makes mental math easy, and it lands slightly closer to the exact doubling constant for mid-range returns.
Does the Rule of 72 include contributions?
No — it assumes a single lump sum growing at a constant rate, with no extra contributions or withdrawals. For plans that add money regularly, use a compound interest calculator instead.
Can I use it for inflation?
Yes. Divide 72 by the inflation rate to see how quickly cash loses half its buying power. At 3% inflation, money loses half its value in about 24 years — which is why holding cash long-term is so costly.