Double the Cash

Imagine if you could put away a pile of cash, and have twice that amount down the road. That might sound too good, but any interest rate will eventually double your money.
The only question is, how long will it take?
Armed with a simple equation and a calculator, you can figure out exactly how long it will take for your money to double. It works like this: divide your interest rate into 72. Yeah, that's it. For example, 72 divided by 6 gives you 12. So if a sum of money is invested at 6%, that money will double in 12 years. Get it?
           Most people have heard at some point that saving money is important. Grandparents, parents, counselors and teachers told us to start a savings account, put some away for a rainy day. There are houses to buy and children to send to college, trips to take and retirements to plan for. And most banks are more than happy to help you start one. I heard a commercial on the radio urging customers to rush into ____ bank:"Right now! Start a savings account with ten thousand dollars and GET A 1.3% INTEREST RATE!! RIGHT NOW!" It
sounded like this was the hottest deal on the planet.
            Wait a second though. Apply that interest rate to the 72 equation: 72 divided by 1.3 gives you 55.38 years. That's most of a lifetime, isn't it? I just demonstrated how a 6% interest rate doubled money in 12 years. Hence, in that same 55 years, that same sum of money could double 4 times! That 1.3% savings account suddenly stops looking like
such a great idea.
           When you put money in a savings account, you are investing it. That money becomes an investment in your bank, with the bank paying you around a percent interest. Understand that the bank is investing your money at a much higher interest rate than that 1%-and collecting much more money than the few dollars you make at the end of the year.
           Is there a good reason why your money should collect interest for the bank? Shouldn't your hard-earned dollars just work for you? The investments that make 10, 12% interest are available to you-through a better route than a savings account. (Money invested at 12%, by the way, doubles every 6 years.) Allow me to clear up a common but often unspoken myth: it does not take thousands of dollars to start investing your money. Nor do you necessarily have to wait 20 or 30 years before you can reap the benefits of those investments. There are hundreds of different types of investment accounts. Some sit for 5 or 6 years, others can build for decades. If you continue to add money to your original investment-which really can be as small as a couple hundred dollars, your money will grow even faster.
           Remember, money in an investment account accrues interest every year. That means that every year you delay, you hold back your money-and add on to the amount of years it takes for your money to double.