Earning Rs 20 lakh can still leave you middle class? CA’s warns about silent money mistakes urban Indians make

A high salary often leads to unaccounted spending. Unchecked expenses like investing in a fancy apartments, premium gyms, expensive cars, and frequent dining out are commonly associated with financial success. But according to one chartered accountant, many professionals earning lakhs every month are quietly trapped in a cycle that only looks wealthy from the outside. Behind the impressive paychecks, there is often a growing dependence on EMIs, rising lifestyle costs, and little real financial freedom. His warning about “silent money mistakes” is now striking a chord online.

Nitin Kaushik recently took to X to explain why earning a large salary does not automatically translate into wealth. According to him, a high income can easily become what he described as a “high-speed treadmill toward zero” if spending habits rise alongside earnings. He pointed out that many people mistake income for financial security, when in reality, middle-class living is often determined more by expenses than by salary itself.

CA's example

To explain his point, Kaushik compared two individuals earning the same monthly income of around Rs 1.6 lakh. While both appear equally successful on paper, their lifestyles create entirely different financial futures. According to his example, one person chooses a Rs 45,000 apartment and finances a mid-sized SUV. The second person lives in a simpler Rs 25,000 setup and drives a fully paid-off hatchback instead of upgrading vehicles for status.



That difference alone, he explained, creates nearly Rs 25,000 in extra monthly savings for the second person.

Over five years, if invested at a conservative 12 per cent annual return, that Rs 25,000 monthly gap could compound into nearly Rs 20 lakh. While one individual ends up with depreciating liabilities and expensive lifestyle commitments, the other quietly builds liquid assets and financial flexibility.

Convenience and luxury

Kaushik argued that one of the biggest dangers of a high salary is that it makes convenience and luxury feel normal very quickly. Every increment begins disappearing into lifestyle upgrades instead of wealth creation.


A better apartment, more dining out, newer gadgets, premium subscriptions, expensive schools, luxury vacations, and upscale neighbourhoods slowly become fixed expenses rather than occasional indulgences. Over time, the cost of maintaining that lifestyle grows so large that even a high salary starts feeling insufficient.

No financial freedom

According to him, this is where many urban professionals unknowingly trap themselves. Their raises no longer increase freedom. Instead, they simply increase the speed at which money flows out. Kaushik stressed that wealth is ultimately determined by the gap between income and needs. A person who spends far below their earning capacity builds security and flexibility. But someone whose expenses rise in direct proportion to every raise remains financially vulnerable despite earning more.

What would happen in the case of a layoff?

He further explained that if income suddenly stops due to layoffs, burnout, illness, or economic downturns, the pressure becomes immediate for people whose lifestyles depend entirely on constant cash flow. In such cases, expensive lifestyles quickly turn into financial stress. Meanwhile, those with controlled expenses and investments gain something much more valuable than status: time and stability.


Kaushik also observed that many people treat their salary as a symbol of achievement. The focus shifts toward appearing successful rather than becoming financially independent. But according to him, people who actually build long-term wealth think differently. They see income as raw material that should eventually create assets, freedom, and future security.