When I first became pregnant with my first child, I knew that I had a responsibility to fulfill. In order to give him a good life and set up some funds for college, I opened up a bank account with $600 and want it to build up to $10,000 in eighteen years.

Following the Rule of 72, lets calculate:

Rate * Time= 72

Replace the time with 18 years.

Rate * 18= 72

Solving for the rate: R= (72/18 years)= 4%

In order to get an annually deposit of $600 to $10,000 in the time frame of eighteen years, I know that I must pay an interest of 4% on the account on an annual basis.

I have been seeing the difference in this investment and now I do this for both of my children.