Rule of 72

The rule of 72 is a formula that helps to calculate the time it will take for an investment to double in value. The rule of 72 is a quick and easy way to calculate how many years it will take for an investment to double in value.

The rule of 72 was first introduced by Benjamin Graham, a well-known financial genius who was also the mentor for Warren Buffett. Investors widely use the Rule of 72 to determine how long it will take for an investment to double its value.

This formula can be used when you want to find out how long it will take for your money to double in value or if you want to find out what would be the rate of return on your money if it’s invested for X years, for example;  if you invest Rs 100 today and receive Rs 200 after nine years then rate of return on your investment is 8%, i.e., 72/ 9.