Easy Financial Math!
Thinking about retirement? Thinking about investing in general? Trying to decide when or if you'll have enough money? Here's a quick financial tip that you can use right this minute. It's called the Rule of 72.
What is the Rule of 72?
The Rule of 72 is a simple way to determine how long an investment will take to double given an average annual rate of interest. And it goes like this:
Say you have $100,000 in your 401K, IRA or brokerage account and you expect a 6% return over it's life. How long until you double your money?
You simply take 72 divided by the rate of return (6%) and that's how many years it will take. Example 72/6 = 12. In 12 years you would have doubled your money or have $200,000 based on this rule. (It could be considerably more than this if you keep investing during the 12 years).
Another example:
Let's say your rate is a whopping 10%. You would take 72/10 = 7.2. It would only take you 7.2 years to double your money. (It could be considerably more than this if you keep investing during the 12 years).
It works in every situation and with every investment and it's easy. No complicated equations.
You need a plan
At 80/20 Financial Services, we are retirement planners. We specialize in retirement planning for electric cooperative employees within 5 years of retirement or already retired.
We believe a goal of retiring - without a plan to increase your income during retirement- is simply a plan to run out of money. Retirement planning is a strategy to maintain and increase that dollar amount over time.
If you're age 50 or over and still in the accumulation phase (pre-retirement) we can help you figure out where you need to go and how to get there. If you are retired or nearing retirement, we can create a plan which will outpace inflation and increase your income over time. The consultation is free and without obligation. Contact us to set up a consultation.
Our mission is to increase your time, money and peace of mind by helping you create a retirement income and investment plan that aligns with your retirement goals and then guide you through the completion of that plan year after year.
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80/20 Financial Services is an Independent Registered Investment Advisor (RIA) registered in the state of Missouri (CRD# 300772). Being independent allows us to work exclusively for YOU. 80/20 Financial Services is the legal name of our Registered Investment Advisory Firm (RIA). Electric Cooperative Retirement Planning is what we do. Our specialty is retirement planning for electric cooperative employees within 5 years of retirement or already retired
We specialize in helping electric cooperative employees create their retirement income and investment plans. Retirement can last 20-30 years. You need a plan!
Photo by Sasun Bughdaryan on Unsplash
