How accurate is the Rule of 72?

Very accurate for rates between 6% and 10%. At 8% the rule gives 9 years; the exact answer is 9.01 years — essentially perfect. At lower rates (2–3%) or higher rates (20%+) the error grows. For rates above 15%, a slightly more accurate divisor is 73 or 74.

Can I use it for inflation or debt?

Yes — the rule applies to any compound growth. At 4% inflation, prices double in about 72/4 = 18 years. At 24% APR credit card debt, the balance doubles in about 3 years if you make no payments.

Rule of 72 Calculator

The Rule of 72 is a mental math shortcut for compound growth: divide 72 by the annual return rate to get the approximate number of years needed to double an investment. It also works in reverse — divide 72 by the years to find the required rate. It is useful for quick comparisons without a calculator.

How this calculator works

Doubling Time (years) ≈ 72 / Annual Rate (%). Required Rate (%) ≈ 72 / Years to Double. The exact doubling time from compound interest is ln(2) / ln(1 + r), which equals about 69.3 / r for small r. The number 72 is used because it is close to 69.3 and has many integer divisors (2, 3, 4, 6, 8, 9, 12), making mental math easy.

Formula reference: Investopedia: Rule of 72

Example

Example: at a 6% annual return, 72 / 6 = 12 years to double. At 9%, 72 / 9 = 8 years. To double in 10 years, you need 72 / 10 = 7.2% annual return.

Frequently asked questions

How accurate is the Rule of 72?: Very accurate for rates between 6% and 10%. At 8% the rule gives 9 years; the exact answer is 9.01 years — essentially perfect. At lower rates (2–3%) or higher rates (20%+) the error grows. For rates above 15%, a slightly more accurate divisor is 73 or 74.
Can I use it for inflation or debt?: Yes — the rule applies to any compound growth. At 4% inflation, prices double in about 72/4 = 18 years. At 24% APR credit card debt, the balance doubles in about 3 years if you make no payments.

This calculator provides estimates for general informational purposes only and does not constitute financial, tax, or legal advice. Always confirm important numbers with a qualified professional or your lender/institution before making a decision.