Some rules to open the gates of financial freedom
15*15*15 Rule
Not just the super-rich, even a salaried individual can accumulate ₹1 crore if he/she follows the 15*15*15 Rule. Save ₹15,000 a month for 15 years continuously, without any single default in monthly savings, in a 15% CAGR generating mutual fund. If he/she wishes to continue the same for another 15 years, he/she would have saved a whopping ₹10.5 crore. The magic lies in compounding and consistency is the key.
Rule of 72
It's a simple trick or a calculation to find out how long it will take for your investment to double at a fixed rate of return. To find the number of years, just divide the number 72 by the interest rate you will receive on your investment. For instance, if you receive 6% interest per annum, money doubles in just 12 years (72/6). Not just this, with this formula, you can calculate the ideal rate of return if you want to double investment in certain number of years.
Say, for example, if you want to double investment in four years, you should get 18% interest per annum. Just divide 72 by the number of years.
Rule of 114
The Rule of 114 is much like Rule of 72 and tells you when investment triples. Just divide 114 by the annual interest rate received to find out how many years you need for wealth to grow threefold. If interest per annum is 6%, money triples in 19 years (114/6). If you want to triple investment in just five years, you should get 22.8% interest per annum (114/5).
Rule of 144
This Rule tells you when your investment quadruples in value — just a simple division.
50/30/20 Rule
Budgeting is crucial to the country and to individuals as well. It might be quite complicated with limited resources and vast goals; however, the 50/30/20 Rule comes in handy to make the budgeting process easier and sustainable. Divide net-income (after tax deductions) into three major categories: 50% for essentials such as rent or housing EMI, groceries, medicines, utilities etc.; 30% for wishes such as entertainment, tour, shopping etc. and balance 20% for savings and debt repayment. Some financial experts add the debt repayment in the first 50% category leaving the 20% category only for savings.
100 Minus Age Rule
The most fundamental question in personal finance is on asset allocation. That is, how much money is to be allocated to buy risky assets such as stock markets and how much should be parked in conservative investment products. The 100 Minus Age Rule answers this dilemma. As per this rule, one must subtract his/her age from 100 to determine the percentage of equity portfolio, and the rest allocated to low-risk assets or traditional fixed/recurring deposits. If you are 30, 70% (100–30) of your investment can be in equities, and 30% in bonds, FDs, or other debt funds.
However, this rule cannot be taken blindly and just gives a fair idea. A young man who is the breadwinner of his family with more commitments can't invest 70% in equities, whereas a septuagenarian pensioner without commitment and is well taken care by children, can invest more in equities.
10X Insurance Rule
The 10X Rule helps an individual calculate the amount of life cover his/her dependents would require in his/her absence. As per this Rule, the term life insurance cover should at least be 10 times his/her gross annual income. However, this rule has its own limitations and might not be suitable for everyone. The Rule doesn't consider factors such as age, specific family needs, number of dependents etc.
While these number-based thumb rules are shortcuts to crack the code of complicated personal finance decisions, one size doesn't fit all.
So, care must be taken while taking important financial decisions.
(The writer is an NISM & CRISIL-certified Wealth Manager)
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Economic Times
2 days ago
- Economic Times
XRP price prediction - Is this Ripple alternative a better bet?
Advertorial Spotlight Wire Fuelled by the broader market rally and friendly regulatory shifts, the XRP price had a strong comeback in July, pumping by over 60%. But this is crypto. Here, charts flip in hours. So, can XRP continue to climb, or does it need a breather amid growing competition from new players like Bitcoin Hyper? XRP fundamentals are strong, but ETF drama throws a curveball After years of legal battle, Ripple is finally on the path to resolving its differences with the SEC. The Trump government is boldly in favour of crypto, rapidly clearing regulatory clouds. However, regulations are not a cakewalk for XRP yet. XRP price performance in June-July, source: CoinMarketCap The XRP price owes its recent surge to the broader market rally. But why XRP? Investors have been stocking up on XRP in renewed hopes for institutional adoption through ETFs. But soon came the twist: the SEC halted the approval of Bitwise's 10 Crypto Index ETF, which includes XRP. Interestingly, it was just hours after the staff greenlit it, and this is the second time this month the commission hit pause under Rule 431. Grayscale's XRP-inclusive GDLC fund was also put on ice recently. Inevitably, the move has spooked investors and raised short-term doubts for the Ripple price. But the altcoin giant's fundamentals are solid, as RippleNet and cross-border payments give it utility beyond the speculative crowd. XRP has eyes set on big goals this year XRP's technical indicators are screaming bullish. The monthly time frame shows 14 buy signals out of 23, while moving averages flash 11 buys. With bullish momentum intact, $6.00 is not a long shot for XRP in the short term, and it could even climb to $6.80 by year-end if market conditions hold. An optimistic, yet realistic XRP price prediction for the end of Q3 2025 is in the $5.80–$6.20 range. XRP technical analysis, source: CoinMarketCap Crypto analysts such as Vincent highlight more trends to establish the bullish narrative, especially with institutions such as JP Morgan recognising XRP as valid collateral. As capital floods back into crypto, XRP is showing textbook consolidation-and-breakout patterns. Crypto influencer and analyst Austin Hilton points out that the liquidity surge across the market is a good sign, as capital is rotating from Bitcoin into major altcoins like XRP and to him, XRP could hit $5 by the end of July, contingent on continued inflows and macro strength. For Q4 2025, the projections are more varied, ranging from $12 to $30. The long-term view is that $100 per XRP is doable for XRP, although it is likely years away. The forecast is tied to broader crypto expansion, especially if Bitcoin touches $200K and Ethereum cracks $10K. Bitcoin Hyper raises $4 million as Layer-2 fuels interest Let's forget about XRP for a second and talk about a new crypto for our watchlists. Bitcoin Hyper ($HYPER) is racing through its presale. It has already clocked in $5.5 is behind Bitcoin Hyper's growing momentum? The project is building a Layer-2 on the Solana Virtual Machine (SVM) for Bitcoin decentralised apps (dApps) and transactions. Using $HYPER tokens, users can bridge BTC into Hyper L2, transact near-instantly, then bridge out securely. That means decentralised finance (DeFi), gaming, and even meme coins on Bitcoin's base security, but with Solana-like speed. With this move, Bitcoin Hyper is positioning itself as Bitcoin's missing execution layer. The $HYPER presale offers a short window to grab the upcoming altcoin before it hits crypto exchanges. As one of the few projects that efficiently taps into Bitcoin branding and utility at the same time, investors are piling in on the presale. Could $HYPER outpace XRP? XRP is clearly the blue-chip star this season, but Bitcoin Hyper offers something XRP doesn't: low market cap and early-mover advantage in the Bitcoin L2 the market taps into pro-crypto regulations and ETF approvals, new utility projects could dominate the hot charts with multifold gains. But investors don't have time till then to grab $HYPER for fixed, discounted prices. The presale is rapidly selling out. In addition, it follows a tiered structure, with each new phase slightly more expensive than the previous. The dynamic passive rewards, on the other hand, decline for latecomers. Visit the $HYPER presale Name: Bitcoin HyperEmail: support@ *You must be at least 18 years old to access this site. Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. The above content is non-editorial, and TIL hereby disclaims any and all warranties, expressed or implied, relating to the same. TIL does not guarantee, vouch for or necessarily endorse any of the above content, nor is it responsible for them in any manner whatsoever. The article does not constitute investment advice. Please take all steps necessary to ascertain that any information and content provided is correct, updated and verified. N.R. Narayana Murthy Founder, Infosys Watch Now Harsh Mariwala Chairman & Founder, Marico Watch Now Adar Poonawalla CEO, Serum Institute of India Watch Now Ronnie Screwvala Chairperson & Co-founder, upGrad Watch Now Puneet Dalmia Managing Director, Dalmia Bharat group Watch Now Martin Schwenk Former President & CEO, Mercedes-Benz, Thailand Watch Now Nadir Godrej Managing Director, of Godrej Industries Watch Now Manu Jain Former- Global Vice President, Xiaomi Watch Now Nithin Kamath Founder, CEO, Zerodha Watch Now Anil Agarwal Executive Chairman, Vedanta Resources Watch Now Dr. Prathap C. Reddy Founder Chairman, Apollo Hospitals Watch Now Vikram Kirloskar Former Vice Chairman, Toyota Kirloskar Motor Watch Now Kiran Mazumdar Shaw Executive Chairperson, Biocon Limited Watch Now Shashi Kiran Shetty Chairman of Allcargo Logistics, ECU Worldwide and Gati Ltd Watch Now Samir K Modi Managing Director, Modi Enterprises Watch Now R Gopalakrishnan Former Director Tata Sons, Former Vice Chairman, HUL Watch Now Sanjiv Mehta Former Chairman / CEO, Hindustan Unilever Watch Now Dr Ajai Chowdhry Co-Founder, HCL, Chairman EPIC Foundation, Author, Just Aspire Watch Now Shiv Khera Author, Business Consultant, Motivational Speaker Watch Now Nakul Anand Executive Director, ITC Limited Watch Now RS Sodhi Former MD, Amul & President, Indian Dairy Association Watch Now Anil Rai Gupta Managing Director & Chairman, Havells Watch Now Zia Mody Co-Founder & Managing Partner, AZB & Partners Watch Now Arundhati Bhattacharya Chairperson & CEO, Salesforce India Watch Now
News18
2 days ago
- News18
How Long Will It Take To Quadruple Your Money? Use The Rule Of 144
The Rule of 144 is a useful calculation that helps evaluate the time required for an investment to quadruple using the power of compounding. For every investor, be it a small or big one, the main goal is to grow their wealth and build long-term financial growth. But investing is more than simply buying the right stocks or funds; it is also about determining how long it will take for your money to grow. The Rule of 144 is a useful calculation that helps evaluate the time required for an investment to quadruple using the power of compounding. This rule provides a simple way to demonstrate the growth of your investments, allowing you to plan and strategise successfully. What Is The Rule Of 144? The Rule of 144 is a financial guideline that determines the number of years required for an investment to quadruple (grow four times) at a certain yearly return rate. To use this rule, divide 144 by the annual interest rate. For instance, if the annual return rate is 10 per cent, the calculation would be 144 divided by 10, yielding 14.4 years. Similarly, if the return rate is 8 per cent, then the calculation would be 144 divided by 8 = 18 years. This rule provides investors with a simple and quick approach to estimate how long it will take for their investments to grow four times, making it ideal for long-term financial planning and investment decisions. The Rule of 144 is said to be an improved version of the well-known Rule of 72, which predicts how soon an investment will double. Instead, the Rule of 144 estimates when your investment will be four times its initial worth. The formula for calculating is pretty easy, as you can calculate it by dividing 144 by the annual interest rate. For example, if you invest Rs 1 Lakh at a 12 per cent annual interest rate. To determine how long it will take for your investment to grow to Rs 4 Lakh, apply the given formula. Therefore, at a 12 per cent annual return rate, it will take around 12 years for your Rs 1 Lakh investment to get to Rs 4 Lakh. This formula provides a quick and straightforward approach to determining how long it will take for your investment to increase. Understanding the Rule of 144 could help people seeking to increase their wealth in establishing realistic investment goals. By selecting the appropriate investment vehicle—whether mutual funds, equities, or other instruments—investors may ensure that their money grows efficiently over time. view comments First Published: Disclaimer: Comments reflect users' views, not News18's. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.
News18
23-07-2025
- News18
How The Rule Of 72 Can Help You Double Your Money
Last Updated: The Rule of 72 is a simple formula that helps you estimate how long it takes to double your money with compound interest. Managing money wisely means understanding how your investments can grow over time. One simple tool that can help is the Rule of 72. It is not complicated or technical—just a quick math trick that gives you a rough idea of how long it will take to double your money at a given rate of return. Let's break it down in a simple way. What Is the Rule of 72? The Rule of 72 is a quick formula used to estimate how many years it will take for your investment to double in value, based on a fixed annual rate of return. It is a handy tool for investors, savers, or anyone curious about how interest affects their money over time. Instead of using a calculator or complex financial formulas, the Rule of 72 offers a fast and fairly accurate shortcut. The Formula Here's the basic formula: 72 ÷ 6 = 12 years The rule is based on the concept of compound interest, where your returns earn additional returns over time. The Rule of 72 gives an approximation of this compounding effect. Here are a few more examples: At 9 per cent interest, money doubles in 8 years (72 ÷ 9). At 12 per cent, it doubles in 6 years. At just 3 per cent, it takes 24 years. It works best with interest rates between 6 per cent and 10 per cent, though it can still give a rough idea outside this range. Advantages of the Rule of 72 – Simplicity: You don't need to be a math expert. The calculation is quick and simple. – Planning Tool: It helps you set realistic financial goals by estimating how long it will take to grow your money. – Comparing Options: You can easily compare different investment returns to see which one doubles your money faster. – Awareness of Inflation: You can even use the Rule of 72 to understand how inflation eats into your money's value. For example, if inflation is 6 per cent, the value of money halves in 12 years (72 ÷ 6). The Rule of 72 is not a perfect tool, but it is a smart, quick way to get a rough estimate of growth. Whether you're investing, saving, or planning your financial future, this simple rule can help you make better decisions and understand the power of compounding. view comments Disclaimer: Comments reflect users' views, not News18's. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.
