Does money really double every seven years?
The "rule of 7" is real arithmetic with a hidden assumption: at a 10% annual return, money doubles roughly every 7 years — it comes from the rule of 72 (72 ÷ 10 ≈ 7.2).
The doubling is real; the "every 7 years" part depends entirely on actually earning 10%. At 7%, the double takes about 10 years — and after inflation and fees, the honest schedule is slower still.
Where the rule comes from
Divide 72 by the annual return and you get the approximate years to double. The "rule of 7" is just that formula with 10% plugged in:
- 4% a year — doubles in about 18 years
- 6% a year — doubles in about 12 years
- 8% a year — doubles in about 9 years
- 10% a year — doubles in about 7 years
- 12% a year — doubles in about 6 years
The magic is in the later doublings
R100,000 doubles to R200,000, then R400,000, then R800,000. Every doubling is worth as much as all the growth that came before it — which is why the waiting feels pointless early and unstoppable late.
Twenty-eight years at 10% is four doublings: sixteen times the starting amount. That's the entire case for starting early, in one sentence.
When the rule flatters you
- Inflation: 10% growth with 5% inflation is a real return of about 5% — your buying power doubles closer to every 14 years, not 7
- Fees: 2% a year in costs turns 10% into 8% — stretching the double from 7 years to 9
- Schedules: markets don't pay 10% evenly — the average can be honest while any given decade disappoints
Using it honestly
Treated as a promise, the rule disappoints. Treated as a lens, it's genuinely useful: how many doublings does this money have left before I need it? Money needed in five years has none — it shouldn't be taking doubling-style risk. Money needed in thirty has four — leaving it uninvested is the expensive choice.
Terms used on this page
- rule of 72
- A quick mental shortcut: divide 72 by the annual return to estimate how many years money takes to double. At 10%, roughly every 7.2 years.
- real return
- Growth after inflation — the increase in what your money can actually buy, not just the number on the statement.
- compounding
- Growth on growth: returns earn their own returns. It is why time in the market matters more than the size of any single deposit.
Reviewed July 2026