Interest Rates: Are you owing it or earning it?

We all are familiar with interest rates but has someone paused to ask themselves if they are actually owing interest or earning interest. Just like credit and debit , the difference is clear. However , it is no news that we all are victims of paying interest. Lets talk about some relatable examples: You have a credit and the interest payable on it is 19% to 22%. You mortgage a house , you pay a variable or fixed interest ranging from 4% to 6%. Infact at the end of every year , majority observe that they have only been paying to the interest and not the principal. You get a car, you are paying interest as well. Thankfully, on this part of the world we have not started paying interest for the air we breathe. 

So , now that I have simplified what it is to pay interest even though we are all unavoidably in that situation . Lets take a look at what it means to earn interest. 

Some people have their savings or investments in funds in GIC, stocks , RRSP, mutual funds to mention a few . But I quickly ask if you know how much of interest you are earning on these savings or investments? There is something called RULE OF 72. The Rule of 72 is a quick, useful formula that is popularly used to estimate the number of years required to double invested money at a given annual rate of return. Better simplified; 72/rate of return = number of years.