The Rule of 72 is a quick mental-math shortcut for estimating how long it takes an investment to double in value at a given annual rate of return, without needing a calculator or spreadsheet.
Simply divide 72 by the expected annual return (as a whole number, not a decimal) to get the approximate number of years to double your money — a return of 8% doubles money in about 9 years, while 12% doubles it in about 6 years.
The shortcut works because of how compound interest behaves mathematically, and it stays reasonably accurate for annual rates roughly between 6% and 15% — outside that range the estimate drifts a bit further from the exact answer, though it’s still useful as a ballpark.
It’s a handy way to compare investment options at a glance, or to quickly sanity-check whether a return being pitched to you sounds realistic for the timeframe promised.
Years to Double ≈ 72 ÷ Annual Return %Example.At a 12% annual return, money doubles in roughly 72 ÷ 12 = 6 years — so ₹1 lakh grows to about ₹2 lakh in 6 years and ₹4 lakh in 12 years, purely from compounding.