Feng Shui Your Financial House

A Quick and Dirty Rule to Help You Double Your Money

Warning! The higher the expected return, the higher the risk

Here’s a party trick to help you make better money decisions.

Learn The Rule of 72, and you can easily calculate how long it takes to double your money, at a specified rate of return.

Let’s say your savings account or stock market portfolio is estimated to earn 5%.

Divide 72 by 5 (not 0.05!), and you’ll see it takes ~14.4 years to double your money.

An 8% return? 72 divided by 8 = ~9 years.

A 15% return? ~4.8 years.

You get the picture.

The higher the return, the quicker you double your dough.

Just remember, returns and risk go hand in hand, like that Jimmy Cliff song, “The harder they come, the harder they fall.”

In general, the higher the expected return, the higher the risk taken.

If you liked this article and want to read more, please subscribe, follow me on Twitter, LinkedIn, friend me on Facebook or visit my website.