Page 79 - Charles Calhoun Book Rich As You Want To Be

CHAPTER 7: THE RULE OF 72

Did you know that Albert Einstein considered his

discovery of the “rule of 72” to be his most important
discovery? And he considered the magic of compound
th
interest or earnings to be the 8 wonder of the world!
Use this rule to your advantage.

The rule of 72 is a good way to estimate what an
investment will grow to be over time. It is one of the really
important ideas about finance. If I were to ask you, “How
much would you like as an allowance or retirement income?”

Would you prefer $200,000 per month? Or would you prefer
perhaps $133 per month? Or maybe you would prefer an
income of $266 per month? Would that be a hard choice to
make? And would you believe these wildly different amounts

could result from the same amount invested and for the same
amount of time? It is of course a silly question, because
everyone would choose the $ 200,000 per month. They may
not believe such an income is possible, yet it is. Many people
make the wrong choice, choosing those smaller amounts as

it often is not spelled out as clearly as in this book. Of course,
it would not be a tough choice. But lots of people make the
wrong choice. Most people do in fact. Many of them are
directed toward those smaller figures by financial salesmen
who sell them products that are not the best. In fact, they are

terrible products. Many people actually chose the lower
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