Hi brenden,
Seems that you mix up altitude vs. altimeter setting, also known as QNH. Since every altimeter is basically a barometer, which measures air pressure, it has to be adjusted for varying barometric pressure. i.e. changes in air pressure due to atmospheric conditions, like high or low pressure weather systems. To do these adjustments, look for a small window in your altimeter on your basic airplane,like the Cessna 172. There you will find a scale which reads in inches of mercury on american systems and / or another window which has a scale for hectopascal or millibars for the rest of the world.
If you are told that the altimeter (setting) is 29.92, this means that you should adjust your altimeter to that value in this small window on your altimeter using the knob of the altimeter. Incidentally 29.92 in Hg (or 1013.2 HPA ) also happens to be the the setting of ISA ( International Standard Atmosphere), but air pressures can and do vary a lot. This is why setting your altimeter to the correct setting is so important.
So to get your altimeter to indicate the correct altitude, you have to adjust it to the current barometric pressure using the before mentioned set knob.
Hope this helps,
Werner