The
Rule
of
72
A
commonly
used
quick
answer
rule
of
mathematics
in
financial
planning
circles
Any
interest
rate
or
inflation
rate
divided
into
72
will
yield
the
number
of
years
it
will
take
to
double
principal
when
investing
, or
,
deplete
to
half
the
purchasing
power
in
the
case
of
inflation.
Example:
3%
inflation--divided
into
72
yields
27
yrs
4%
inflation--divided
into
72
yields
18
yrs
5%
inflation--divided
into
72
yields
14
yrs
6%
inflation--divided
into
72
yields
12
yrs
So,
if
$150,000
is
needed
for
a 3
year
nursing
home
stay
at
$50,000
per
year
,
...now.
At
3%
inflation
you
will
need
to
have
$300,000
on
hand
to
pay
the
same
tab
at
age
70,
if
you
are
age
43
today!
Doesn't
it
make
more
sense
to
save
for
retirement
that
you
can
enjoy,
instead
of
Long
Term
Care
needs?
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