The Rule of 72 estimates the number of years needed for an investment to double by dividing 72 by its annual percentage return.
For example, at an 8% annual return, 72 divided by 8 gives an estimate of 9 years. At 6%, the estimate is 12 years. The rule is a mental-math shortcut based on compound growth, not a guarantee of performance.
The estimate is most useful for moderate interest rates and becomes less precise at very high or very low rates. It also assumes the return is consistently reinvested and ignores taxes, fees, and inflation.
A related shortcut uses the Rule of 69.3, which is mathematically closer for continuous compounding, while the Rule of 70 is sometimes used because it is easier to divide. The Rule of 72 remains popular because 72 has many convenient factors, including 2, 3, 4, 6, 8, and 9.