Ever wondered why we rely on shortcuts in almost every aspect of life, from games to cooking? Investing shouldn’t be any different!
In the world of investing, there are rules that help us understand how fast our money can grow or how quickly it can lose value.
These rules make investment decisions easier, from asset allocation to retirement planning.
Let’s dive into some popular thumb rules:
🔍 Rule of 72: Easily calculate how long it takes for your money to double. Just divide 72 by the expected rate of return.
📊 Rule of 114: Predict how long it takes for your investment to triple by dividing 114 by the expected rate of return.
📈 Rule of 144: Determine the time it takes for your money to quadruple by dividing 144 by the expected rate of return.
💰 Rule of 70: Understand how inflation affects your wealth over time. Divide 70 by the inflation rate to find out when your wealth will be worth half its current value.
💡 Rule of 10, 5, 3: Estimate the average rate of return on your investments based on asset classes.
Knowing these rules can empower you to make informed investment decisions.
Stay tuned for more insights! And checkout our website: www.ledgerpro.in