Money
Visualized: How Long Does it Take to Double Your Money?
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Visualized: How Long Does it Take to Double Your Money?
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At first glance, a 7% return on your investment may not seem that impressive. Yet what if you heard that your money could double in roughly 10 years?
The above graphic takes the rule of 72 shortcut and uses the more precise logarithmic formula to show how long it takes to grow your money at different annualized returns.
Why it Pays to Know the Math
Using the classic rule of 72, an investor can estimate how long it takes to double their money. At 7% annual returns, an investor would see $10,000 grow to $20,000 in about a decade by taking 72 and dividing it by 7%, the rate of return.
While the rule of 72 serves as a guide to estimating when your money will double, the more accurate way to arrive at this number is through a logarithmic equation.
In short, it divides the natural log of 2 by the natural log of 1 and adds this to the rate of return. We can see in the table below how leads to different results from the rule of 72:
Rate of Return | Rule of 72 # of Years to Double Money | Logarithmic Formula # of Years to Double Money |
---|---|---|
2% | 36.0 | 35.0 |
3% | 24.0 | 23.5 |
4% | 18.0 | 17.7 |
5% | 14.4 | 14.2 |
6% | 12.0 | 11.9 |
7% | 10.3 | 10.2 |
8% | 9.0 | 9.0 |
9% | 8.0 | 8.0 |
10% | 7.2 | 7.3 |
11% | 6.5 | 6.6 |
12% | 6.0 | 6.1 |
13% | 5.5 | 5.7 |
14% | 5.1 | 5.3 |
15% | 4.8 | 5.0 |
16% | 4.5 | 4.7 |
17% | 4.2 | 4.4 |
18% | 4.0 | 4.2 |
19% | 3.8 | 4.0 |
20% | 3.6 | 3.8 |
Consider if an investor put their money in the S&P 500. Historically, it has averaged 11.5% returns between 1928 and 2022. In 6.4 years, their money would double, assuming these average returns.
If they were to put this money in a savings account, where the average savings rate is 0.6%, it would take 120 more years for their money to reach this potential.
In real terms, which takes inflation into account, an investor would see their money lose value if they parked it in a savings account. Historically, inflation has averaged 3.3% over the last century.
Historical Asset Returns
Here’s how often different assets double, based on historical returns between 1928 and 2022:
Asset | Average Annual Return 1928-2022 | # of Years to Double Money | End Value of $100 Invested 1928-2022 |
---|---|---|---|
3-Month T Bill | +3.32% | 21.22 | $2,140.51 |
Real Estate | +4.42% | 16.03 | $5,121.52 |
U.S. T Bond | +4.87% | 14.58 | $7,006.75 |
Gold | +6.48% | 11.04 | $8,866.76 |
Corporate Bonds* | +6.96% | 10.30 | $46,379.53 |
S&P 500** | +11.51% | 6.36 | $624,534.55 |
Source: NYU Stern. *Represents Baa corporate bonds, which are considered investment grade. **Includes reinvested dividends.
We can see that 3-month T-Bills, often considered among the safest assets, doubled about every 21 years. Often, investors consider this a place to put cash that is low-risk and highly liquid.
Interestingly, real estate assets had returns of 4.4%, doubling roughly every 16 years. Between 1928 and 2022, the value of $100 invested in real estate assets would be worth $5,121.52. By contrast, the value of $100 invested in the S&P 500, including reinvested dividends, would have reached over $624,000.
Data from NYU Stern shows that the S&P 500 has doubled about 10 times since 1949—through recessions and bull markets—illustrating the power of investing over the long run.
Markets
Top 10 Countries Most in Debt to the IMF
Argentina tops the ranking, with a debt equivalent to 5.3% of the country’s GDP.
Top 10 Countries Most in Debt to the IMF
This was originally posted on our Voronoi app. Download the app for free on iOS or Android and discover incredible data-driven charts from a variety of trusted sources.
Established in 1944, the International Monetary Fund (IMF) supports countries’ economic growth by providing financial aid and guidance on policies to enhance stability, productivity, and job opportunities.
Countries seek loans from the IMF to address economic crises, stabilize their currencies, implement structural reforms, and alleviate balance of payments difficulties.
In this graphic, we visualize the 10 countries most indebted to the fund.
Methodology
We compiled this ranking using the International Monetary Fund’s data on Total IMF Credit Outstanding. We selected the latest debt data for each country, accurate as of April 29, 2024.
Argentina Tops the Rank
Argentina’s debt to the IMF is equivalent to 5.3% of the country’s GDP. In total, the country owns more than $32 billion.
Country | IMF Credit Outstanding ($B) | GDP ($B, 2024) | IMF Debt as % of GDP |
---|---|---|---|
🇦🇷 Argentina | 32 | 604.3 | 5.3 |
🇪🇬 Egypt | 11 | 347.6 | 3.1 |
🇺🇦 Ukraine | 9 | 188.9 | 4.7 |
🇵🇰 Pakistan | 7 | 374.7 | 1.8 |
🇪🇨 Ecuador | 6 | 121.6 | 4.9 |
🇨🇴 Colombia | 3 | 386.1 | 0.8 |
🇦🇴 Angola | 3 | 92.1 | 3.2 |
🇰🇪 Kenya | 3 | 104.0 | 2.8 |
🇬🇠Ghana | 2 | 75.2 | 2.6 |
🇨🇮 Ivory Coast | 2 | 86.9 | 2.3 |
A G20 member and major grain exporter, the country’s history of debt trouble dates back to the late 1890s when it defaulted after contracting debts to modernize the capital, Buenos Aires. It has already been bailed out over 20 times in the last six decades by the IMF.
Five of the 10 most indebted countries are in Africa, while three are in South America.
The only European country on our list, Ukraine has relied on international support amidst the conflict with Russia. It is estimated that Russia’s full-scale invasion of the country caused the loss of a third of the country’s economy. The country owes $9 billion to the IMF.
In total, almost 100 countries owe money to the IMF, and the grand total of all of these debts is $111 billion. The above countries (top 10) account for about 69% of these debts.
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