CA warns: Just cutting out expenses won’t beat inflation. He suggests a simpler, smarter way to stay ahead

At a time when grocery bills, rents, and everyday expenses feel relentlessly higher, many people are instinctively trying to cope by tightening their budgets. But according to CA Nitin Kaushik, that instinct may be doing more harm than good. In a sharply worded post on X, he breaks down why obsessing over cost-cutting is a losing financial strategy and why the real solution lies elsewhere. His argument is blunt, math-backed, and uncomfortable, but hard to ignore in today’s inflation-hit economy.

CA Nitin Kaushik points out that while it feels natural to complain about the nearly 20 per cent jump in cost of living over the past three years, focusing only on rising prices misses the bigger problem. Median incomes, he explains, have simply not kept pace with inflation. Expecting prices to fall back to old levels is unrealistic because money is designed to lose value over time. Inflation is not a temporary glitch but a structural feature of the system.




He then breaks the issue down with a simple example. If someone has monthly expenses of Rs 4,000, even a painful 10 per cent cut saves only Rs 400. That effort often involves real lifestyle sacrifices, yet the financial upside remains limited. On the other hand, if the same person increases their income by 20 per cent, whether by upgrading skills, switching roles, or building a side income, the gain is at least Rs 800. The effort required may be similar, but the outcome is dramatically different.

According to Kaushik, the core flaw in aggressive cost-cutting is that it has a hard ceiling. Expenses can only be reduced up to a point. You cannot cut beyond zero. Income, however, does not work the same way. The potential to earn more has no theoretical upper limit. Skills can compound, career moves can unlock higher pay brackets, and additional income streams can scale over time.


The real financial game, Kaushik stresses, is not about squeezing every rupee from your expenses but about outrunning inflation before it erodes your purchasing power. Everything else, he says, is noise.