The Rule of 72 - Financial Wellness Series

“Money makes money. And the money that money makes, makes money.” – Ben Franklin

Everyone has some idea of what it means to be money smart—however, whether or not you’ve acted on that idea is a different story! There are a few nuggets of financial wisdom in particular that are echoed so many times in articles, blog posts and TV segments that they become clichés, albeit practical ones. Curb your spending. Pay off your debt. Contribute to your savings early and often. Compound interest is your friend. Start saving now and watch your money grow.

Compound interest means earning interest on your interest.  A handy tool that can be used to approximate how long it will take for an investment to double at a given interest rate is the Rule of 72.  Time is money when it comes to compound interest—the longer you wait to get started, the less interest you’ll earn.  The Rule of 72 can be useful for comparing investments, savings goals and retirement.

Do you know how to use the Rule of 72?  Watch the video below to find out...