Question

How long will it take you to triple your money if you invest it at a rate 6% compounded annually?

Answer 1

It will approximately take 18 years 10 months.

The compound interest formula is:

`A = P * (1 + (r/n))^(nt)`

Where:

`P` is the initial amount
`r` is annual rate of interest
`t` is number of years
`A` is the final amount of money
`n` is the number of times the interest is compounded per year

Source of Formula

So we want to find `t`. Lets start

`3 * P = P * (1 + 0.06)^t`
`3 = 1.06^t`

Now we should use logarithmic functions.

`ln(3) = t * ln(1.06)`

`ln(3)/ln(1.06) = t`

`t = 18.85`

So the answer is approximately 18 years 10 months.