Rule of 72!!
People in the financial industry and the Bankers know about the Rule of 72. WhatÂ is this Rule of 72?
Let me illustrate it with an example:
Imagine you have money in the bank at 3%. Your money will double in 72/3Â years ie 24 years.
However imagine you invest it at a place which where you get 12%. In thisÂ case money doubles in 72/12= 6 years. Yes 6 years!!
Hence the important question to ask yourself is what is the expected rate ofÂ return on your investments or what is the current rate of return you areÂ getting?
Keep in mind you have to know your risk tolerance before investing!!