The Rule of 72: Simlify Your Investment Calculations

What is the Rule of 72?

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How Does It Work?

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Why is it Useful?

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Real-Life Example

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The Power of Compounding

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Limitations of the Rule

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Quick Takeaway

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Call-to-Action

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The Rule of 72: Simlify Your Investment Calculations

Learn how this simple formula can help you double your investments!

What is the Rule of 72?

The Rule of 72 is a quick way to estimate how long your investment will take to double, based on its annual return rate.

How Does It Work?

Divide 72 by the annual rate of return (interest rate). Example: At a 6% return rate: 72 ÷ 6 = 12 years to double your money.

Why is it Useful?

– Helps you plan investments. – Gives a clear idea of the time frame for growth. – Great for comparing different options.

Real-Life Example

If you invest ₹1 lakh at a 9% return: 72 ÷ 9 = 8 years Your ₹1 lakh will double to ₹2 lakh in 8 years.

The Power of Compounding

Reinvesting earnings accelerates growth. Example: ₹2 lakh doubles to ₹4 lakh in another 8 years.

Limitations of the Rule

– Works best for consistent annual returns. – Doesn’t account for inflation or taxes. – Not accurate for very high or very low rates.

Quick Takeaway

Use the Rule of 72 for simple, quick estimates of your investment’s growth potential. Start investing smart today!

Call-to-Action

📈 Want more investment tips? Check out our blog for detailed guides and calculators.