When does money double, when does purchasing power halve?
There is a rule of thumb for doing this in your head: 72 divided by the annual rate in percent gives roughly the years until an amount doubles.
It works in both directions. At an interest rate it tells you when a balance has doubled, at an inflation rate when the price level has doubled, and that is exactly the point where your money is worth half.
For your head, 72 divided by the annual rate is enough. For a decision, take the exact figure.
At a return of 6.0 % a year, 72 divided by that rate gives 12 years until the amount has doubled.
Arithmetic only, no data series behind it.
Figures for United States. Country and currency follow your choice in the header.
Questions people ask
How does the rule of 72 work?
You divide 72 by the annual return in percent. The result is roughly the number of years until the amount has doubled.
How accurate is the rule of 72?
Close for rates between about four and ten percent, and less so above and below. It is an approximation of a sum that properly needs logarithms.
Does the rule work for inflation as well?
Yes, the other way round: 72 divided by the inflation rate is roughly the number of years until purchasing power has halved.
Source: US Bureau of Labor Statistics, CPI-U, all items, US city average (CUUR0000SA0), annual averages, as of 2026-09, retrieved 2026-11-09
One rate, and the time until money doubles or purchasing power halves.
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Education, not advice. Disclaimer