There are certain calculation techniques that we, financial consultants used to make us looks cool, sharp and FAST. 
One of the well known, unguarded secrets is the usage of Rule of 72.
The ‘Rule of 72′ is a simplified way to determine how long your investment will take to DOUBLE, given a fixed annual rate of interest.
Example if you have $10,000 now, given an investment return of 10%/year, how long will it takes your money to turn $20,000?
@20%/year, how long will it takes your money to to turn $20,000?
The formula is simple. Divide 72 by the annual rate of return (example 10 or 20), you can get an estimate of how many years it will take for your initial investment to DOUBLE.
So…..Investment annual return of 10%, it will take about 7.2 years for your money to DOUBLE….
Investment annual return of 20%, it will take about 3.6 years for your money to DOUBLE….
| Rate of Return | Rule of 72 | Actual # of Years | Difference (#) of Years |
| 2% | 36.0 | 35 | 1.0 |
| 3% | 24.0 | 23.45 | 0.6 |
| 5% | 14.4 | 14.21 | 0.2 |
| 7% | 10.3 | 10.24 | 0.0 |
| 9% | 8.0 | 8.04 | 0.0 |
| 12% | 6.0 | 6.12 | 0.1 |
| 25% | 2.9 | 3.11 | 0.2 |
| 50% | 1.4 | 1.71 | 0.3 |
| 72% | 1.0 | 1.28 | 0.3 |
| 100% | 0.7 | 1 | 0.3 |
From the table, you can see, the higher your rate of return, the faster, your money will DOUBLE!
If you will like to know of instruments that can help your money to double, do not hesitate to call me. Thanks!
My other related posts that may interest you:
- NTUC Income Ideal Plan: Just Some Questions And Answers
- Investment That Can Give ROI of More Than 1000%
- Some Questions & Answers On NTUC Income Flexi-Cash
Mon, Sep 28, 2009
Investment