Starting out
Purchasing power
What your money can actually buy, rather than how many units of currency you have.
How it works
Purchasing power is the only measure of wealth that means anything over long periods. Doubling your money over twenty years while prices also double leaves you exactly where you started.
Preserving purchasing power is the minimum job of a long-term portfolio. Growing it is the actual goal, and it is a much harder target than a nominal number suggests.
Related terms
Mentioned in
More in Starting out
Educational reference only. Nothing here is investment advice or a recommendation to buy or sell anything, and tax treatment depends on your own circumstances and the country you are in.