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If you’re ever wondering how long it’ll take for your investments to grow, the Rule of 72 can help. Just divide the number 72 by your interest rate to get the number of years it’ll take for your money to double.

Reading about this quick and easy calculation in the last chapter of Tina Hay’s “Napkin Finance” really resonated with me, because one of my money goals is to focus more on investing. This month, I plan to increase my 401(k) contributions, so I’ll see greater returns when my money eventually does double.

How are you all coming along with your money goals so far this year?

**Writer at The Penny Hoarder. All opinions expressed are my own and don't necessarily reflect the views of The Penny Hoarder.**

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Last edited by Theodora
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Lots of comments below about low bank interest rates.  Same is similar for bonds (very low rates of return right now - but better than banks).  There is a need to invest at least a "good" portion of your savings in the equity market (i.e. the stock market).  If you are in it for the long run and invest in a broadly held globally diversified large pool of stocks (like an Index fund), you will diversify your risk and be much more likely to get towards the 6% returns used in the above Napkin Finance example.  Emphasis on the long run and for things like funding your retirement.  Be careful of waking up at age 65 having had all your money/savings in the bank earning close to zero interest and not even keeping up with the inflation rate over the prior 30-40 years.  Inflation for planning purposes over the long haul should be about 3% or so.

Last edited by Phil H.

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