Rule of 72 Calculator

The Rule of 72 is a simple formula to estimate doubling time: Years to Double = 72 / Annual Return Rate. At 8% return, money doubles in 72/8 = 9 years. At 6%, it doubles in 12 years. At 3%, in 24 years. It works because 72 is close to the mathematical constant needed for continuous compounding.

Very accurate for rates between 5-12%. At 8%, Rule of 72 gives 9 years; exact answer is 9.01 years (0.1% error). At 4%, it gives 18 years vs. exact 17.67 (1.9% error). At 25%, error is about 2.5%. More accurate alternatives: Rule of 70 (lower rates), Rule of 69.3 (continuous compounding).

Works for debt too. A credit card at 18% APR doubles your debt in 72/18 = 4 years if you make no payments. Payday loan at 400% APR: debt doubles in 72/400 = 0.18 years (about 66 days). This mental math is powerful for understanding the cost of high-interest debt.

Rule of 69.3 is more mathematically precise for continuous compounding. For comparing very different rates or for precise calculations, use the exact formula: Years = ln(2) / ln(1 + r). The Rule of 72 is for quick mental math. Rule of 69 is for precise calculations. Both give the same approximate result.

Inflation erodes purchasing power at the same rate math applies. At 3% inflation, prices double in 72/3 = 24 years. At 7% inflation, prices double in just 10.3 years. This is why high inflation is dangerous: a 7% inflation rate halves your purchasing power in a decade.