IIM investment advisor has a 'painful advice' to Bengaluru techies: Take 30% pay cut, leave metros and live a content life

A high-paying job in a metro city often seems like the key to financial security, but for many, it turns into a constant struggle to stay afloat. Despite earning Rs 1.5 lakh per month, a Bengaluru techie recently shared on Reddit how his life felt "fragile," with savings that could disappear quickly if he lost his job. His experience reflects a growing concern among urban professionals: high salaries don’t always translate to financial stability.

Abhishek Kumar, a SEBI-registered investment advisor and IIM Bangalore alumnus, highlighted this issue on LinkedIn, calling metro life a "financial trap." He pointed to real cases, including a tech couple earning Rs 2.4 lakh per month in Bengaluru who barely managed to save Rs 15,000. "Life in a metro is a financial trap for many," Kumar noted, emphasizing how rising costs, financial obligations, and lifestyle inflation eat away at earnings.

High Salary, Yet Financial Stress

Kumar pointed out that this situation is not unique. He recalled advising a tech couple earning Rs 2.4 lakh per month in Bengaluru who struggled to save, managing only Rs 15,000 monthly with no investments. "Life in a metro is a financial trap for many," he noted, explaining how high costs, family obligations, and lifestyle inflation erode earnings.

Breaking Down the Metro Trap

He outlined key financial pitfalls professionals face in metros:

The 40-30-30 Rule: In metros, 40% of income goes to housing, 30% to necessities, and only 30% is left for savings and discretionary spending. In tier-2 cities, this ratio can be reversed, allowing for better financial stability.

Property Investments: A Rs 2 crore apartment in Bengaluru may appreciate only 3-5% annually while consuming up to 50% of income in EMIs.

Family Responsibilities: Around 70% of his clients under 30 financially support their parents, as parental savings are often spent on their children’s education.

Emergency Fund Needs: A three-month emergency fund is outdated. Metro living now requires at least 8-12 months of financial backup.

Lifestyle Inflation: Every Rs 10,000 salary increase tends to lead to Rs 7,000 in additional spending due to lifestyle creep.

A Difficult but Practical Advice
Kumar stated that one of the toughest but most beneficial financial decisions is to leave metro cities if feasible. "Many of my clients took a 30% pay cut, moved to their hometowns, and are now living a more content life," he shared.

His post has sparked a discussion among professionals about financial security and alternative lifestyles. One Reddit user commented, "Income isn't wealth. It's a sad realisation. The only people who get to be secure have generational wealth. Everyone else gets to face the heat." Another said, "Welcome to adult life. Constant anxiety and money worries are the norm."

The rising cost of living in metro cities has made many question if their financial stress is worth the urban lifestyle. Have you ever felt financially trapped despite earning well? What city do you live in, and what’s your biggest financial struggle?