Question: What Is The 7 Year Rule For Investing?

If you want to double your money, the rule of 72 shows you how to do so in about seven years without taking on too much risk.

The rule states that the amount of time required to double your money can be estimated by dividing 72 by your rate of return.

Does your money double every 7 years?

Here’s how the Rule of 72 works:

At 10%, money doubles every 7.2 years and when you divide 7.2 by 10%, you get 72. This rule of thumb helps you compute when your money (or any unit of numbers) will double at a given interest (growth) rate.

How can I double my money in 5 years?

Since you are looking for the investment option that may double your money in 5 years, then with the Rule of 72, it works out to be 72/5= 14%. That means you will be required at least 14% average annual returns to double your invested amount. Now that you know how much returns you may require.

What will \$5000 be worth in 20 years?

How much will an investment of \$5,000 be worth in the future? At the end of 20 years, your savings will have grown to \$16,036. You will have earned in \$11,036 in interest.

72