A fuller guide to this term is on the way. In the meantime, the related terms below explain the ideas around it.
Related MoneyPedia terms
- Purchasing PowerHow much your money can actually buy, which shrinks when prices rise faster than your income grows.
- Real ReturnYour investment gain after subtracting inflation, showing the true growth in what your money can buy.
- Nominal ReturnYour investment gain before accounting for inflation, stated as the raw percentage your money grew.
- Time Value of MoneyThe idea that a dollar today is worth more than a dollar later, because money you have now can be invested to grow.
- Cost of LivingThe amount of money needed to cover basic expenses like housing, food, and transportation in a given place.
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Plain-English education — not personalized legal, tax, or investment advice.