Doubling your money is easy. Seriously. A more surefire way to double your money requires a few key ingredients: time, return, trust and math.
Time to grow. Return of your initial investment plus a percentage more. Trust that the investment will continue to grow and not fall to zero, and Math guided by the Rule of 72.
The Rule of 72 will tell you how long it will take for your money to double at a given rate of return. 72 is the product if you like multiplication. It’s the numerator if you’re into fractions.
It was a good time to be invested, and a good time for me to appreciate the power of the rule. With a compound annual growth rate of 18%, money was doubling about every 4 years on average.
It can help you plan and project. Let’s say you’ve saved up $250,000, but you want to be a millionaire. You need to double your money twice. With 6% interest, that will take 12 + 12 years, so 24 years.
By convincing you not to blow your money. I’ll ask myself a simple question when considering any significant purchase or upgrade.