Mountain Financial Services: Rule of 72 and Rule of 115

The Rule of 72 And The Rule of 115

How Long Will It Take To Double Or Triple Your Investment?

The "rule of 72" is a handy mathematical rule which helps in estimating approximately how many years it will take for an investment to double in value at a specified rate of return.

For example, at a 1% rate of return, an investment will double in approximately 72 years; at a 10% rate of return it will take on 7.2 years, etc.

The "rule of 115" is a similar rule that allows one to estimate how long it will take an investment to triple in value.

For example, at a 1% rate of return, an investment will triple in approximately 115 years; at a 10% rate of return it will take only 11.5 years, etc.

Rate of Return	1%	2%	3%	4%	5%	6%	7%	8%	9%	10%	11%
Years to Double	72	36	24	18	14.4	12	10.3	9	8	7.2	6.5
Years to Triple	115	57.5	38.3	28.8	23	19.2	16.4	14.4	12.8	11.5	10.5

Rate of Return	12%	13%	14%	15%	16%	17%	18%	19%	20%	21%	22%
Years to Double	6	5.5	5.1	4.8	4.5	4.2	4.0	3.8	3.6	3.4	3.3
Years to Triple	9.6	8.8	8.2	7.7	7.2	6.8	6.4	6.1	5.8	8.5	5.2

These rules can also tell you how long before a given item will double or triple in price at an estimated average rate of inflation. For example, at an estimated average inflation rate of 8%, a loaf of bread will double in price every 9 years.

This is a hypothetical illustration and is not indicative of any particular investment.


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