How it works
Compounding means your interest earns interest too — the longer you hold, the more the growth curves upward instead of staying flat. The Rule of 72 is a mental-math shortcut: divide 72 by your annual return (%) to estimate how many years it takes to double your money.
FAQ
Q. What's the difference from simple interest?
A. Simple interest applies only to the principal; compound interest applies to principal plus all previously earned interest — the gap widens fast over time.
Q. How accurate is the Rule of 72?
A. It's quite accurate around 6–10% annual returns; at very high or low rates the estimate drifts a bit. For the exact figure, use the projected final balance above.