The Rule of 72

 

    

    This is one of my favorite concepts to talk about it since this came from the world's most renowned scientist and mathematicians in the world, Albert Einstein. This Rule was invented by him when one day someone asked him "how long will it take my money to double", and Einstein came up with this number 72. How it works is very simple, if you just this number 72 and divide it by the interest you get at the bank either it is in a savings account, GIC/Term deposit, Seggrated fund, etc, it will show how many years it will take for your money to double. For example, this graph showed interest rates of 2, 4, and 6, over time it can make a very huge impact on what you get as a return with just only 10,000 invested. 

Questions:

1. What is the current interest in each of my accounts and is it actually growing my money?

2. How many years will it take me to see my money double if I just left the money at the bank?

3. Am I aware of how to make money work me, or am I always chasing after the next 2% raise?

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