Rule of 72

The rule of 72 is a simple rule of thumb for working out how long it takes for your money to double.

Formula: 72 ÷ interest rate (in %) = years until doubling

Examples:

• Savings book (0.1%): 72 ÷ 0.1 = 720 years (!) – you'll be dead before your money doubles
• Overnight money (3%): 72 ÷ 3 = 24 years
• Fixed-term deposit (4%): 72 ÷ 4 = 18 years
• ETF (7%): 72 ÷ 7 = ~10 years – your money doubles every 10 years!
• Shares historically (10%): 72 ÷ 10 = ~7 years

Works the other way round too: you want to double your money in 6 years? 72 ÷ 6 = 12% return needed – possible with shares, but not guaranteed.

For children: "If you invest €100 in an ETF, you'll have €200 in 10 years – without doing anything!"