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Inflation-adjusted spending, in plain terms

A dollar at 85 buys less than a dollar at 65. Modeling spending in real terms — not flat nominal dollars — keeps your plan honest.

Real vs. nominal

•Nominal dollars are the literal cheque amounts; real dollars are adjusted for what they can actually buy.
•At 2% inflation, a $72,000 lifestyle at 65 needs about $106,000 nominal by age 85 to buy the same things.

What the toggle does

•With inflation-adjusted on, your spending target escalates each year by the inflation rate (default 2%).
•This is more realistic — but it means you need more nominal income in later years, so accounts deplete faster.
•With it off, spending stays flat in nominal dollars — which quietly shrinks your real lifestyle over time.

Why it interacts with the phases

•The three-phase model (60s peak, 70–84 lower, 85+ partial reversal) already reduces real spending as you age.
•Adding inflation on top means the nominal dollars still rise, even as the real lifestyle steps down — the two effects partially offset.

Toggle inflation

Turn on "Adjust spending for inflation" in the Sequencer to see the more realistic (and tougher) plan.