Overview
When planning your finances, it’s important to distinguish between:
Actual Currency (also called Nominal dollars) - The future dollar amounts you'll see on your bank statement or paychcek - the raw dollar figure before considering inflation.
Today’s Dollars (also called Real Dollars or Inflation-Adjusted Dollars) - What that future amount is really worth in today's terms, after accounting for the rising cost of living (inflation)
Even though your salary, savings, or home value may appear larger in the future, inflation reduces how much that money can actually buy.
Within Canwi viewing projected figures in Actual Currency vs Today's dollars is controlled in Scenario Settings.
Example: Salary Growth vs. Today’s Dollars
Let’s say your income grows by 4% per year, but inflation is 2.5% per year.
If we look at Actual Currency (the actual number on your paycheck and that you receive), your salary might look like this:
Year | Salary (Actual Currency) |
2025 | $80,000 |
2030 | $97,000 |
2035 | $118,000 |
💡 Looks great, right? But when adjusted for inflation, your salary’s actual buying power is not as high as this suggests:
Year | Salary (Actual Currency) | Salary in Today’s Dollars (Buying Power) |
2025 | $80,000 | $80,000 |
2030 | $97,000 | $85,600 |
2035 | $118,000 | $92,500 |
Even though your salary increases, the extra income buys you less than it seems, because prices are rising too.
Quick summary of terms:
Term | Also called | Meaning |
Actual Dollars | Nominal Dollars | The raw dollar amount you'll receive |
Today’s Dollars | Real Dollars, Inflation-Adjusted | What that money is worth in today's purchasing power |