PPF, FD, mutual fund, other investments: How long does it take to double your money? - How much time will it take to double your money? (2024)

Table of Contents
How much time will it take to double your money? What is Rule of 72? How Rule of 72 works Simple thumb rule How much do you need to invest Limitations

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PPF, FD, mutual fund, other investments: How long does it take to double your money? - How much time will it take to double your money? (1)

Ever wondered how much time it would take to double your money? There is a simple thumb rule for it. It can tell you how fast your money will double at a given rate of return.

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PPF, FD, mutual fund, other investments: How long does it take to double your money? - How much time will it take to double your money? (2)

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What is Rule of 72?

According to this rule, you need to divide the estimated annual rate of return by 72 to know the number of years it will take for your money to double.

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PPF, FD, mutual fund, other investments: How long does it take to double your money? - How much time will it take to double your money? (3)

Let me give you an example. Suppose, you want to invest Rs 50,000 in a fixed deposit at 7 per cent interest rate. Now, divide 72 by the rate of interest (7%) to know the time it will take for Rs 50,000 to become Rs 1 lakh. So, 72/7 will be 10.2 years. Hence, it will take 10.2 years to double your money if the interest rate remains the same at 7%.

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PPF, FD, mutual fund, other investments: How long does it take to double your money? - How much time will it take to double your money? (4)

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Simple thumb rule

This rule gives a fair estimate if your portfolio return is within the range of 4-15%.

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PPF, FD, mutual fund, other investments: How long does it take to double your money? - How much time will it take to double your money? (5)

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How much do you need to invest

You can also use this rule to know how much interest you need to double your money in a specific time. Suppose, you want to double your money in, say, eight years. Then, you divide 72 by 8, which will be 9%. So, you will need a 9% interest rate to double the money in eight years.

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Limitations

Do remember the Rule of 72 is not the most accurate calculation. However, it gives a good idea to investors. The calculation does not take into account the cost of investing and the impact of taxes

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PPF, FD, mutual fund, other investments: How long does it take to double your money? - How much time will it take to double your money? (2024)
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