If you're nearsighted, you can't read distant signs or maybe even distinguish between different people from far away. Nearsighted people need to wear glasses, especially when they're driving.
When someone is "farsighted," they see far-off objects well, but have trouble with close-up things like the print in a book or newspaper. In contrast, being nearsighted means you can read a magazine with no problem, but you need contacts or glasses in order to bring distant objects into focus. A more formal word for nearsighted is myopic.