Question:
❓If you invest $5,000 and it earns an average of 7% per year, about how long will it take to double?
A) 5 years
B) 7 years
C) 10 years
D) 14 years
Answer:
✅ C) 10 years
At a 7% return, your money takes about 10 years to double—that’s the Rule of 72: divide 72 by your annual return to estimate the years.
So $5,000 at 7% grows to about $10,000 in 10 years, then about $20,000 a decade after that. The rule works at any rate:
| Annual return | Years to double (72 ÷ rate) |
|---|---|
| 4% | 18 years |
| 6% | 12 years |
| 7% | ~10 years (exact math: 10.2) |
| 8% | 9 years |
The earlier you start, the more doubling periods you get—that’s compounding doing the heavy lifting.
See how your own number grows over time—try the compound interest calculator.
