According to CA Anil Sagayanathan's recent LinkedIn post, a ₹1 crore salary no longer guarantees financial freedom or security. As reported by Mint, Sagayanathan points to a striking shift over the past decade - where a ₹25 lakh salary once provided genuine comfort and stability, today even a ₹1 crore salary often leaves people feeling financially stretched. The reason lies in lifestyle inflation, which quietly expands to consume every additional rupee of income as expectations rise at the same rate. A bigger home replaces a smaller one, luxury cars replace modest vehicles, and international holidays replace domestic ones, with income growing but financial freedom not following suit.
Sagayanathan identifies four critical traps that ensnare high earners, as reported by Mint. The first trap is the CTC illusion - where a ₹1 crore CTC does not mean ₹1 crore is available for spending, as taxes and deductions reduce the actual take-home figure by a considerable margin. The second trap involves invisible lifestyle inflation - where a ₹40,000 EMI feels burdensome at ₹25 lakh income but at ₹1 crore, a ₹1.5 lakh EMI suddenly feels manageable. The third trap is peer group pressure - where social circles shift as income rises, with luxury becoming the new baseline rather than aspirational purchases. The fourth and most dangerous trap is high dependency - where one employer, one salary, one large EMI and one expensive lifestyle do not constitute financial independence but high income tied to high vulnerability.
Sagayanathan reframes the entire purpose of earning ₹1 crore, as reported by Mint. He emphasizes that the real objective of earning ₹1 crore isn't to look like someone earning ₹1 crore, but to build enough assets that someday you don't need to earn ₹1 crore to maintain your lifestyle. He closes with a critical question: "If my salary stopped tomorrow, how long could my current lifestyle continue without borrowing or selling assets?" This question may reveal more about your financial health than your salary slip, highlighting the importance of building asset-based financial security over relying on income alone.
Investment adviser Abhijit Kumar's five-step financial audit method provides practical solutions for high earners feeling financially stretched. According to Mint, the audit's first step involves adding up every EMI from the last three bank statements, including no-cost EMIs, where Kumar's client initially believed their EMIs totaled ₹35,000 but the actual figure was ₹68,000, representing 32% of take-home pay. The second step involves identifying every subscription, app renewal, delivery fee, and unused gym membership, with most people discovering ₹4,000 to ₹9,000 in forgotten charges. The third step recommends moving SIP dates to the 1st or 2nd of the month, while the fourth step involves building a six-month emergency fund in a liquid fund or fixed deposit. The final step calculates the real savings rate by dividing monthly savings by take-home income, with figures under 10% indicating spending leaks rather than salary problems.
Social media users responded positively to both Sagayanathan's LinkedIn post and Kumar's financial audit advice, with one user noting that savings rate calculation is a better starting point than simply asking someone's earnings. According to Mint, another user emphasized that "these high-paid jobs are always fragile, not dependable" and suggested saving maximum before spending, while referencing a case where an Indian earning a high salary was fired and the entire family committed suicide. The consensus emphasized that earning more and managing money well are two different skills, with higher salaries potentially disappearing quickly without proper cash-flow discipline. Users also suggested controlling unnecessary spending to make salary appear larger, highlighting the importance of behavioral changes over income levels.
