A recent LinkedIn post by Sarthak Ahuja, an investment banker from Gurugram, has ignited discussion after he proposed that an annual salary of ₹70 lakhs no longer ensures financial ease in major Indian cities. Ahuja labeled this earnings range as part of the "new middle class" and pointed out how swiftly substantial incomes get eroded by essential costs, offering minimal scope for saving or indulgences.
Ahuja's post suggests From a total gross salary of ₹70 lakhs, roughly ₹20 lakhs is withheld as tax, leaving an approximate take-home pay of ₹50 lakhs. This amounts to about ₹4.1 lakhs each month, which might seem like a significant sum but diminishes quickly due to essential expenditures. He mentions, “After covering primary expenses, this only allows for ₹1 lakh for miscellaneous costs.”
The investment banker elaborates on these expenditures. A substantial amount of Rs 1.7 lakh goes towards paying off an EMI for a home loan worth Rs 2 crores taken out for purchasing a property valued at Rs 3 crores. Other financial obligations consist of an EMI payment of Rs 65,000 toward financing a Rs 20 lakh vehicle over three years, along with Rs 50,000 set aside monthly for schooling at an international institution and Rs 15,000 designated for employing domestic staff.
Ahuja cautions that after accounting for those expenditures, only about Rs 1 lakh remains available for all additional costs such as grocery bills, utility payments, personal expenses, and funds set aside for yearly getaways. He emphasizes this point by exclaiming, “At the close of each month, I have absolutely nothing remaining!!!” According to him, this predicament reflects the monetary pressures experienced by numerous individuals with substantial incomes.
He outlines three main factors contributing to this financial strain: quickening inflation, escalating property and automobile prices, and increased lifestyle demands fueled by social media. Ahuja highlights a grim truth, stating, "In many cities, a typical home costs between 10–15 times the yearly earnings of a family. In Mumbai, it surpasses 30 years’ worth!"
The conclusion of the post offers practical guidance for young professionals, emphasizing the importance of being cautious when considering housing loans. Ahuja states, “The simplest thing you can do to address this issue is to think carefully before agreeing to a housing loan!” This encourages a more thoughtful strategy for handling significant monetary obligations.
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