Double your money
There's a great rule of thumb calculation you can use to show you how long it takes to double your money. It's called the rule of 72. Let me explain how it works. Basically if you want to find out how long it will take you to double your money you simply divide the interest rate/investment return into 72! It's that simple.
As an example if you were to get a return of 7.2% p.a. then it would take you roughly 10 years to double your money (72/7.2). At 3.6% p.a. it would take 20 years and at 14.4% 5 years! Exciting isn't it?
You can also use this calculation to find out how soon it takes to halve your money by using an inflation rate instead of an interest rate.
This is a very useful rule of thumb for those of you who aren't into mental maths.
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Wealth and Tax Management Independent Financial Planners is the trading name of Byrne Williams Limited which is authorised and regulated by the Financial Services Authority. Company registered number 2020674. Registered in England and Wales. Registered address: 1 The Willows, Mill Farm Courtyard, Stratford Road, Beachampton, Milton Keynes, MK19 6DS
