Comments on: The Rule of 72 – How It Helps, And How It Doesn’t http://morethanfinances.com/the-rule-of-72-how-it-helps-and-how-it-doesnt/ Get your finances in order, and get on with your life! Mon, 16 May 2011 23:14:40 +0000 hourly 1 http://wordpress.org/?v=3.3.2 By: Darren http://morethanfinances.com/the-rule-of-72-how-it-helps-and-how-it-doesnt/comment-page-1/#comment-325 Darren Sun, 20 Jun 2010 17:41:30 +0000 http://morethanfinances.com/?p=1385#comment-325 Hey mat, Thanks for stopping by. Yep, the way to calculate the actual time to double is pretty simple. Using Excel's NPER function, you put in your desired percentage in the Rate field, put -1 in the Pv field, and 2 in the Fv field. Leave the Pmt and Type fields blank. If this is a bit confusing and you want the actual spreadsheet, let me know and I'll send it to you! Hey mat,

Thanks for stopping by. Yep, the way to calculate the actual time to double is pretty simple. Using Excel’s NPER function, you put in your desired percentage in the Rate field, put -1 in the Pv field, and 2 in the Fv field. Leave the Pmt and Type fields blank.

If this is a bit confusing and you want the actual spreadsheet, let me know and I’ll send it to you!

]]> By: mat http://morethanfinances.com/the-rule-of-72-how-it-helps-and-how-it-doesnt/comment-page-1/#comment-323 mat Sun, 20 Jun 2010 16:28:11 +0000 http://morethanfinances.com/?p=1385#comment-323 Hey, Very interesting points, loved everything about it... Is there a way to come up with a formula for the lower then 7% or higher then 10% ?? Hey, Very interesting points, loved everything about it…
Is there a way to come up with a formula for the lower then 7% or higher then 10% ??

]]> By: Darren http://morethanfinances.com/the-rule-of-72-how-it-helps-and-how-it-doesnt/comment-page-1/#comment-321 Darren Sun, 20 Jun 2010 04:51:37 +0000 http://morethanfinances.com/?p=1385#comment-321 FinEngr - You brought up a good point. These calculations also don't take taxes into account, or inflation for that matter. For that, you'd need a fancy calculator like the HP 12C or TI BA II Plus! FinEngr – You brought up a good point. These calculations also don’t take taxes into account, or inflation for that matter. For that, you’d need a fancy calculator like the HP 12C or TI BA II Plus!

]]> By: FinEngr http://morethanfinances.com/the-rule-of-72-how-it-helps-and-how-it-doesnt/comment-page-1/#comment-320 FinEngr Sun, 20 Jun 2010 03:43:56 +0000 http://morethanfinances.com/?p=1385#comment-320 @<a href="#comment-313" rel="nofollow">Darren</a>: It wasn't the inputs per se, but the calculators. I started with the same variables, then some asked more than others - so I tried to keep it as consistent as possible. Some asked for tax bracket while others asked what type of accounts (taxable/non-tax) for example. @Darren:

It wasn’t the inputs per se, but the calculators. I started with the same variables, then some asked more than others – so I tried to keep it as consistent as possible.

Some asked for tax bracket while others asked what type of accounts (taxable/non-tax) for example.

]]> By: Darren http://morethanfinances.com/the-rule-of-72-how-it-helps-and-how-it-doesnt/comment-page-1/#comment-313 Darren Fri, 18 Jun 2010 15:26:13 +0000 http://morethanfinances.com/?p=1385#comment-313 Thanks FinEngr. Yeah, because they're approximations, it helps to know how to compute actual future value, time horizon, interest rate, and other similar variables. Just curious, what inputs did you use that led you to a 12-year time difference? Thanks FinEngr. Yeah, because they’re approximations, it helps to know how to compute actual future value, time horizon, interest rate, and other similar variables.

Just curious, what inputs did you use that led you to a 12-year time difference?

]]> By: FinEngr http://morethanfinances.com/the-rule-of-72-how-it-helps-and-how-it-doesnt/comment-page-1/#comment-312 FinEngr Fri, 18 Jun 2010 14:13:13 +0000 http://morethanfinances.com/?p=1385#comment-312 Nice write-up & graphics. Very important to understand that these are approximations, and actual results can vary significantly based on your parameters. Over-simplifying the results can have very real effects. For example, I went through and entered similar data into different retirement calculators. The time it would take me to reach $1M varied by about 12 years! To answer your question - I think the power of the rule comes in product comparison, when you're looking at different investment vehicles for a specific time frame. Nice write-up & graphics. Very important to understand that these are approximations, and actual results can vary significantly based on your parameters.

Over-simplifying the results can have very real effects. For example, I went through and entered similar data into different retirement calculators. The time it would take me to reach $1M varied by about 12 years!

To answer your question – I think the power of the rule comes in product comparison, when you’re looking at different investment vehicles for a specific time frame.

]]> By: Darren http://morethanfinances.com/the-rule-of-72-how-it-helps-and-how-it-doesnt/comment-page-1/#comment-302 Darren Mon, 14 Jun 2010 23:28:22 +0000 http://morethanfinances.com/?p=1385#comment-302 Thanks Neal! Never heard of that approximation for seconds in a year. Nice tip! Thanks Neal! Never heard of that approximation for seconds in a year. Nice tip!

]]> By: Monterey Marketing Lab (Neal) http://morethanfinances.com/the-rule-of-72-how-it-helps-and-how-it-doesnt/comment-page-1/#comment-301 Monterey Marketing Lab (Neal) Mon, 14 Jun 2010 23:21:19 +0000 http://morethanfinances.com/?p=1385#comment-301 Cool post Darren, It's good to have some quick numbers like that in your back pocket. As I have studied physics we had a few like that. Like the number of seconds in a year is approximately pi x 10^7. -Neal Cool post Darren,
It’s good to have some quick numbers like that in your back pocket. As I have studied physics we had a few like that. Like the number of seconds in a year is approximately pi x 10^7.
-Neal

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