One of the questions I get consistently asked is ‘how long it will take to double my money on the stock market or with any other investment?’ The answer depends on the rate of return. If you have a high rate of return, it will take a shorter period to double your money and if you have a lower rate of return it will take longer. Have a look at the below table to see how long it will take to double your money. As a reference, the historical average return of stocks is approx 7%-8% so you would double your money every 10 years via stock market investing.
|Annual Rate Of Return On Investment||Number Of Years It Will Take For Your Money To Double|
Besides looking at the table above to identify how long it would take for you to double your money, you can simply use the rule of 72.
The Rule of 72 is a quick way of figuring out how quickly your investments will double in value. Just divide 72 by the rate of return and you have the number of years it takes to double your money, roughly.
For example, if the interest rate is 8%, your money doubles in about 9 years (72/8 = 9).
The rule of 72 is quick and easy tool that can help you weigh your investment options.