Explained: The rule of 70 and formula 12x12x12 in investing

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Whenever we invest, the first thing we want to know is when will our money double. Investors often tend to be more interested in knowing the time horizon to yield results, will their money increase in 5 years or in 10 years?

The rule of 70 is the formula that will tell in how much time the value of your money will be halved. That is, in how much time your purchasing power will decrease. When you divide 70 by the inflation rate, the number that comes out tells you in how many years the value of your money is halved. So let’s move on from the point of reduction and increase the money.

The 12x12x12 formula is another way to analyse your investment planning. If you keep depositing an amount of Rs 12000 continuously for 12 years, then it will be able to turn into a corpus of lakhs.

Watch the full video to know how these formulas work…