Rule of 72 as of · 167
In a household notebook, Rule of 72 is judged from . The line is “Future value (annuity-ish savings)” and the figure in the sum is 1. A blinking gain on a screen is not the reason. Engineering economy and corporate finance normalise NPV language.
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. This atlas page keeps the focus on mechanisms you can reason about: rates, time, contributions, costs and behaviour — not stock tips or promised yields.
For Rule of 72 in , the figure that stays is 1, named “Future value (annuity-ish savings).” Sparkle is not a figure.1
Figures to keep
- Year of the rule
- 1
- Figure in the sum
- 1
- Item
- Rule of 72
- Reason kept
- Future value (annuity-ish savings)