Comments on: When Will My Investment Double? http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/ Money issues for college students and 20-somethings, without being boring. Tue, 24 Apr 2012 13:02:17 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Jonathan http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-252504 Jonathan Sun, 11 Dec 2011 23:04:41 +0000 http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-252504 I don't understand why I've never come across this rule before, that is awesome. I've just used it on some investments I made recently and it's pretty accurate, what a brilliant post. I don’t understand why I’ve never come across this rule before, that is awesome. I’ve just used it on some investments I made recently and it’s pretty accurate, what a brilliant post.

]]> By: Annie @ Credit Dispute http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-77522 Annie @ Credit Dispute Mon, 24 Aug 2009 18:32:31 +0000 http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-77522 They say that you can also apply the rule of 72 shortcut to many different things. Just like savings account growth, the effects of inflation, and the growth of a debt from the interest charged. They say that you can also apply the rule of 72 shortcut to many different things. Just like savings account growth, the effects of inflation, and the growth of a debt from the interest charged.

]]> By: Weekly Dividend Investing Roundup – August 8, 2009 | The Dividend Guy Blog http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-76695 Weekly Dividend Investing Roundup – August 8, 2009 | The Dividend Guy Blog Sat, 08 Aug 2009 11:04:40 +0000 http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-76695 [...] When Will My Investment Double? [...] [...] When Will My Investment Double? [...]

]]> By: Roger http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-76671 Roger Fri, 07 Aug 2009 18:53:42 +0000 http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-76671 I love the rule of 72; it's such a handy little shorthand. I actually had a situation where I was asked about the time it would take to double your income, and the rule of 72 let me do the calculation in my head. Go, rule of 72! I love the rule of 72; it’s such a handy little shorthand. I actually had a situation where I was asked about the time it would take to double your income, and the rule of 72 let me do the calculation in my head. Go, rule of 72!

]]> By: JoeTaxpayer http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-76560 JoeTaxpayer Wed, 05 Aug 2009 16:36:53 +0000 http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-76560 I have a 72 story for you. I was in grad school, and the Prof made a remark about selling Manhattan in 1626 for $24. He asked what it should be worth today at an expected market rate of 6% total return. I looked up and said $24 billion. (Note, this was in 1986, very conveniently). He asked where my 'work' was, and I showed him my hands. Of course over that number of doublings the errors added up to my being 28% off, the answer being closer to $30.9B. Less than 5 years off on 360, still not bad. BTW, jump to 8% and the answer (on my fingers) is $24 trillion, with actual number $25.9 T. Fun stuff. I have a 72 story for you.
I was in grad school, and the Prof made a remark about selling Manhattan in 1626 for $24. He asked what it should be worth today at an expected market rate of 6% total return.
I looked up and said $24 billion. (Note, this was in 1986, very conveniently). He asked where my ‘work’ was, and I showed him my hands. Of course over that number of doublings the errors added up to my being 28% off, the answer being closer to $30.9B. Less than 5 years off on 360, still not bad.
BTW, jump to 8% and the answer (on my fingers) is $24 trillion, with actual number $25.9 T.
Fun stuff.

]]> By: John Hunter http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-76551 John Hunter Wed, 05 Aug 2009 11:46:15 +0000 http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-76551 69 is a bit closer to the mathematical answer; the "rule of 72" is used because 6*12 and 4*18 go into 72 exactly. 69 is a bit closer to the mathematical answer; the “rule of 72″ is used because 6*12 and 4*18 go into 72 exactly.

]]> By: Mouli Cohen http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-76474 Mouli Cohen Mon, 03 Aug 2009 23:06:02 +0000 http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-76474 A great formula for investors. Looks like the interest rates won't be climbing back up for quite a while now though, so there won't have to be too much adjusting on the rule. With the economy continuing to fall, even though more slowly, it seems the rule of 72 is probably less consistent then during boom times. A great formula for investors. Looks like the interest rates won’t be climbing back up for quite a while now though, so there won’t have to be too much adjusting on the rule. With the economy continuing to fall, even though more slowly, it seems the rule of 72 is probably less consistent then during boom times.

]]> By: Tom @ Herbal Fiberblend http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-76473 Tom @ Herbal Fiberblend Mon, 03 Aug 2009 21:28:31 +0000 http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-76473 I'd never heard of the rule of 72 before but from what you say it makes perfect sense - i've been investing in shares for a while now but never looked at payback in these terms. I’d never heard of the rule of 72 before but from what you say it makes perfect sense – i’ve been investing in shares for a while now but never looked at payback in these terms.

]]> By: The Dividend Guy http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-76467 The Dividend Guy Mon, 03 Aug 2009 18:40:19 +0000 http://poorerthanyou.com/2009/08/03/when-will-my-investment-double/#comment-76467 I love the rule of 72. As a dividend investor I can use it - if I know that a company has consistently raised its dividend by 8% for the past few years, and I make the assumption that it will continue to do so (a big assumption mind you), then I can calculate that that my dividend income will double in 9 years. Amazing. However, as I mentioned, this assumes a constant growth rate over that period of time. I love the rule of 72. As a dividend investor I can use it – if I know that a company has consistently raised its dividend by 8% for the past few years, and I make the assumption that it will continue to do so (a big assumption mind you), then I can calculate that that my dividend income will double in 9 years. Amazing.

However, as I mentioned, this assumes a constant growth rate over that period of time.

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