The Rule of 72

Doubling time at a compound rate $r$ is exactly $\ln(2)/\ln(1+r)$, which is a miserable thing to compute in your head during an interview. The Rule of 72 replaces it with an approximation almost anyone can do without a calculator: divide 72 by the annual growth rate, expressed as a whole-number percentage, and the result is roughly the number of years to double.

At an 8% annual return, doubling time is about $72/8 = 9$ years. At 6%, it's $72/6 = 12$ years. At 12%, it's $72/12 = 6$ years. The number 72 is chosen deliberately over the mathematically "purer" $100 \times \ln(2) \approx 69.3$ because 72 divides evenly by more small integers (2, 3, 4, 6, 8, 9, 12), making the mental arithmetic cleaner, at a small cost in accuracy.

The approximation is best in the 6–10% range, where it's typically accurate to within a few percent of the true doubling time; it drifts further off at very low rates (under 2%) or very high ones (above 20%), where the underlying logarithm curves away from the straight-line approximation the rule assumes. For quick interview mental math or a back-of-envelope portfolio sanity check, though, it's accurate enough to be genuinely useful rather than just a party trick.