The Rule of 72: A simple rule that will change the way you think about money. It's a lesson we should introduce to our children early in life.

The Rule of 72 helps estimate how long it takes for your money to double based on a fixed annual return.

How does it work?

To find the years required to double your money:

72 ÷ Annual Return (%) = Years to Double

Example: If your annual return is 10%, then:
72 ÷ 10 = 7.2 years
£1,000 invested at 10% will double in about seven years.

It also works in reverse: to find the required annual return to double your money in a set time.

72 ÷ Years to Double = Required annual return.

For example, to double your money in six years:
72 ÷ 6 = 12%

Understanding the Rule of 72 can help you see the power of compound interest—a concept that’s not always intuitive.

Start early: Small, consistent investments over a long time lead to extraordinary gains. The secret? Never interrupt compounding.

Don’t wait too long to invest:
Starting later in life means you’ll need higher annual returns to achieve the same results. Quick wealth is often fragile wealth. But remember: it’s never too late to start investing.

While the Rule of 72 can motivate you to save and invest, balance is key.

Live Your Life:
Don’t forget to live your life. What’s the point of working hard and earning money if you don’t enjoy it?

But

Spend Wisely: Avoid spending to impress others. Ask

1. Would I still want this if no one else saw it?
2. Would I still enjoy this vacation if no one knew about it?

A life well lived has minimal regrets.

That is it for today, take it easy until next time.

Read all my “Notes to Self” at view all blogs.