What is the Rule of 72?
The Rule of 72 is a simple mathematical shortcut used to estimate the number of years required to double your investment at a given annual rate of return. By dividing the number 72 by the annual interest rate, investors get a highly accurate estimate of how long it will take for their initial investment to duplicate itself.
The Formula
Years to Double = 72 ÷ Interest Rate
Example 1: Fixed Deposits (FDs)
If you invest ₹1 Lakh in an SBI or HDFC Fixed Deposit offering an interest rate of 6%:
Calculation: 72 ÷ 6 = 12 Years.
It will take 12 years for your ₹1 Lakh to become ₹2 Lakhs in a standard FD.
Example 2: Equity Mutual Funds
If you invest ₹1 Lakh in a Nifty 50 Index Fund that historically delivers an average CAGR of 12%:
Calculation: 72 ÷ 12 = 6 Years.
It will take approximately 6 years for your investment to double.
Test the Math!
Want to see the exact numbers? Use our Fixed Deposit calculator to see precisely how much interest your money earns over time.
Open FD CalculatorGrow Money Faster
If doubling every 12 years isn't fast enough, explore SIPs in Mutual Funds where historical returns are closer to 12-15%.
Plan Your SIPFrequently Asked Questions
Is the Rule of 72 accurate for mutual funds?
The Rule of 72 provides a highly accurate estimate for fixed-return investments like FDs and PPF. For mutual funds, it gives a good approximation based on the expected average CAGR, but since market returns are volatile, the actual time to double will vary.
What is the Rule of 114?
While the Rule of 72 tells you how long it takes to double your money, the Rule of 114 tells you how long it takes to triple your money. (Formula: 114 ÷ Interest Rate).