A Bank Counter Lesson with Liza the Banker
In this post, you’ll learn the “Rule of 72” — a simple math trick to estimate how long it takes for your money to double.
Steady the turtle and Zippy the rabbit already invest through their core-satellite strategy — a global index fund for the core and a few favorite stocks for the satellites. But today, as they bring their piggy banks to Liza’s bank, they discover a new way to appreciate the power of time and compounding.
🌞 A Bright Morning at the Bank
The morning sun poured through the tall glass windows of Liza’s bank.
Steady and Zippy walked in, each carrying a small piggy bank full of coins.
“Good morning, Liza!” Steady greeted politely.
“Good morning, boys!” Liza smiled. “Here to make another deposit?”
Zippy nodded. “Yes! We’re adding to our investing fund. We keep part of our allowance here until we’re ready to buy more shares.”
“That’s very wise,” Liza said warmly. “You two are already investing — but do you know how long it might take for your money to double?”
Zippy tilted his head. “Double? You mean… without buying more stocks?”
Liza laughed softly. “Exactly. Just through the power of time — and a little math trick called the Rule of 72.”
🛠️ The Simple Math Trick
Liza took out a notepad and wrote neatly:
72 ÷ interest rate = years to double your money
“It’s not a perfect formula,” she explained, “but it gives you a quick estimate.”
Zippy leaned over the counter. “Okay, say my savings earn 6% a year—what happens?”
“Let’s see,” Liza said, tapping her pen. “72 ÷ 6 = 12. That means your money will double in about twelve years.”
“Twelve years?” Zippy’s eyes widened. “That feels so slow!”
Steady smiled calmly. “That’s why patience is part of every smart investor’s plan.”
“Exactly,” said Liza. “If the rate is 8%, it would double in about nine years. But at 3%, it would take twenty-four. The higher the return, the faster it doubles—but remember, higher returns often mean higher risk.”
Zippy nodded thoughtfully. “So even our global index fund grows by using this same math?”
Liza beamed. “Yes! Whether it’s savings or investments, compounding is what helps your wealth snowball over time.”
📒 Steady’s Notes
Steady pulled out his small notebook and wrote carefully:
- The Rule of 72 shows how long it takes for money to double.
- Formula: 72 ÷ interest (or growth) rate = years to double.
- Compounding makes both savings and investments grow faster over time.
- Higher returns come with higher risks — balance matters.
- Start early, stay patient, and let time do the work.
He smiled. “This really connects with our core-satellite plan — time helps both parts grow steadily.”
🎓 Quiz Time！– Can You Answer These?
- What does the Rule of 72 help you find?
a) How much tax you owe
b) How long it takes money to double
c) How much you can spend each month
→ Answer: b - If your savings grow at 8%, your money doubles in about:
a) 9 years
b) 12 years
c) 18 years
→ Answer: a - What key lesson did Liza teach?
a) Fast returns are always safe
b) Compounding and patience create real growth
c) Saving doesn’t matter if you invest
→ Answer: b
🐢 🐇 What Steady and Zippy Learned
Steady: “Even small gains can grow big with time. That’s why we stay consistent.”
Zippy: “Yeah! The Rule of 72 makes patience sound like a superpower!”
They left the bank, lighter piggy banks in hand and bigger dreams in their hearts — ready to let time and compounding keep working for them.
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