Growing up, I never really understood why my grandparents became so obsessive about money, how much they saved, and how much they were worth, but it was clear they were quite obsessed with money.

Now, I’m sure the roots of their obsession with money can be found in their wartime childhoods, when things were rationed and they had to go without more times than they could count.

As my grandparents grew older, they were very good with their money, but still obsessive about making sure their investments were growing so their net worth would continue to grow.

As for the next generation, my father doesn’t seem overly obsessive about money, He is doing fine financially, and he had a retirement plan which he executed well and is now living quite a comfortable retirement.

Unfortunately, however, my mother’s early death ultimately kept them from spending their retirement years together. Therefore, confronting the reality that tomorrow is never promised, I think it made him retrain his mind to enjoy life and the money he has made to the fullest.

Now to my generation, in all honestly, I have become slightly obsessive about money, growing up hearing my parents say – over and over again: “We can’t afford it”.

I have spent the last 30 years working hard and sacrificing a lot to put myself in a financially comfortable position. Interestingly, my husband also grew up in a household where those words were also used, which in turn has made him quite passionate about growing our wealth so we can retire earlier.

With retirement now drawing closer (nine years, fingers crossed), I am looking at ways to substantially increase my net worth, and that goal is driving my investment decision-making. Essentially, I’m interested in how to double or triple my net worth in the next nine years.

In my financial planning days, I often referred to the Rule of 72, which is a super-easy-to-understand shortcut for estimating the number of years it will take for an investment to double in value given a fixed annual rate of return.

Conversely, you can also use the Rule of 72 to identify what interest rate you need to double your money in a certain number of years.

The rule is simple: divide 72 by the annual rate of return (expressed as a percentage) to get approximately the number of years it will take for your investment to double.

Formulas:

• To find out how many years it will take to double your money:

Years to double = 72 ÷ interest rate

• To find out what interest rate you need to double your money in a certain number of years:

Interest Rate = 72 ÷ number of years

Here is an example:

Your $10,000 investment grows at an annual interest rate of 6 per cent. How long will it take for your money to double?

Using the rule: years to double = 72 ÷ 6 = 12 years

Assuming the interest rate stays the same and is compounded annually, it will take approximately 12 years for your $10,000 will grow to approximately $20,000.

But what if you want to double your money in nine years?

Interest Rate = 72 ÷ 9 = 8 per cent

You’d need an 8 per cent annual return to double your money in nine years.

The Rule of 72 works because it is based on the formula for compound interest. Conveniently, it simplifies calculations by providing an estimate rather than an exact answer.

Importantly, the approximation works best for interest rates between 6 per cent and 10 per cent, which are common in many investments. For rates outside this range, the estimate might be slightly off but still close enough to give you a pretty good idea. This rule is great for quick mental calculations and for understanding the power of compound interest. It helps you see how different rates of return impact your investments over time.

However, like all financial rules, there are limitations to the Rule of 72:

• It provides an estimate, not an exact figure.

• It assumes the interest is compounded annually.

• It works best with interest rates between 6 per cent and 10 per cent. Outside this range, the estimate may be less accurate.

• Real investments may have fees, taxes, or changing rates that affect growth.

In my case, I am concerned about doubling my net worth in – hopefully – nine years, so I need to ensure that my investments generate an 8 per cent rate of return annually to be close to achieving my goal.

To generate an 8 per cent return on my investments, I will need to diversify my investment portfolio to balance risk and optimise gains and to invest strategically in dividend-paying stocks or index funds with a track record of steady growth.

Furthermore, I will need to contribute consistently to my investment portfolio and be disciplined to ensure I remain on track to hopefully achieve my goals within the nine-year time frame.

Let’s face it, saving diligently in the years leading up to retirement is crucial for ensuring financial security and peace of mind during retirement.

The desire to ensure you’ll finally be able to relax is probably what drives obsessiveness regarding money. The pre-retirement years are a critical period, during which individuals need to maximise their savings, catch up on retirement contributions, and eliminate any outstanding debts.

While it can feel overwhelming, this period also provides an opportunity to capitalise on investment growth and adjust strategies to meet retirement goals.

By prioritising saving during this time, you can grow your nest egg, mitigate the impact of market fluctuations, and secure yourself a more comfortable retirement.

• Carla Seely has 25 years of experience in the international financial services, wealth management, and insurance industries. During her career, she has obtained several investment licences through the Canadian Securities Institute. She holds the ACSI certification through the Chartered Institute for Securities and Investments (UK), the qualified associate financial planner (QAFP) designation through FP Canada, and the associate in insurance (AINS) designation through The Institutes. She also holds a master’s degree in business and management