Rule of 72 as of · 155
In a household notebook, Rule of 72 is judged from . The line is “Prefer net rates” and the figure in the sum is 72. A blinking gain on a screen is not the reason. This atlas page keeps the focus on mechanisms you can reason about: rates, time, contributions, costs and behaviour — not stock tips or promised yields.
No. Tool-Lifes pages are educational atlases. Decisions need your goals, constraints and, when appropriate, a licensed adviser. Do I need a high return for compounding to matter? Higher net rates help, but time and contributions often dominate — especially early. Costs and behaviour can erase a “good” rate.
Treat outputs as scenario sketches. Vary contribution, rate, fees and inflation to see which lever moves your goal date. Always ask whether a figure is nominal or real. A high nominal path can still lose purchasing power. No. Illustrations use round teaching numbers. Markets, inflation and taxes change.
In the net rate that compounds. Expense ratios, advice charges and spreads all reduce terminal wealth. From foundations, continue to contributions-vs-rate or fee-drag; for behaviour, open consistency-habit or panic-selling. Separate contributions, growth, fees, taxes and withdrawals. Mixing them hides which lever actually moved.
For Rule of 72 in , the figure that stays is 72, named “Prefer net rates.” Sparkle is not a figure.72
Figures to keep
- Year of the rule
- 72
- Figure in the sum
- 72
- Item
- Rule of 72
- Reason kept
- Prefer net rates