No, this isn’t about government taxes. The biggest deduction from your salary isn’t TDS—it’s debt. A recent study reveals that 33% of an average salaried Indian’s income goes toward EMIs. That means one-third of earnings are already spoken for before a single rupee is spent on food, transport, or leisure. The question is, are we in control of our money, or is our money controlling us?
For many, debt isn’t an emergency tool—it’s a way of life. The rise of easy credit, from Buy Now, Pay Later (BNPL) schemes to high-limit credit cards, has blurred the line between affordability and illusion. When monthly payments become a permanent fixture, financial freedom turns into an illusion—one where earnings exist only to service past expenses.
The 33% Salary Black Hole
Breaking down an average salary paints a sobering picture. 33% is dedicated to EMIs, while 39% goes to non-negotiable expenses like rent, bills, and household necessities. That leaves just 29% of income for discretionary spending—the portion of money we actually have control over.
The numbers expose a stark reality: Are we truly progressing, or are we simply working to service our financial commitments? If disposable income is shrinking, does earning more actually translate to living better—or just handling larger payments?
Lifestyle Overload or Necessity?
Consumer behavior further complicates the equation. A significant 62% of discretionary spending is directed toward fashion and personal care, highlighting how social status and consumer culture play into financial decisions. Metro city dwellers, for example, spend 6.4% more on lifestyle purchases than those in smaller towns.
Even entertainment spending reflects income dynamics—22% of low-income earners spend on online gaming, a figure that drops to 12% for high-income earners. The paradox? Those with fewer financial resources often engage more in short-term gratification, while wealthier individuals channel their money differently.
The Cost of Credit Culture
The BNPL and credit economy has redefined consumption patterns. More than ever, borrowing has become synonymous with spending power. But behind the convenience lies a deeper consequence:
- Loans create an affordability illusion. Easy access to credit makes everything feel within reach—until payments stack up.
- Rising EMIs shrink financial independence. The more you owe, the less flexibility you have over your earnings.
- Higher spending leads to lower savings, creating long-term dependency. When every raise leads to a bigger EMI rather than a growing investment portfolio, financial security remains out of reach.
The result? A society where people are upgrading their lives, not through assets, but through debt—fueling short-term satisfaction while eroding long-term stability.
The Bigger Picture: Who’s Really Winning?
While fintech and UPI have revolutionized access to money, financial discipline hasn’t caught up. Banks want you borrowing, BNPL platforms want you spending, and the economy thrives on your dependency. The system is built to keep money moving—but not necessarily into your savings account.
If debt-fueled spending is the norm, who benefits the most? Certainly not the average consumer who is tied to endless payments. We work harder, but wealth accumulation remains elusive. The real winners are the institutions that profit from a perpetual cycle of lending and repayment.
The Way Out: Owning, Not Owing
Breaking the cycle requires a shift in mindset. The path to financial security isn’t just about how much you earn—it’s about how much you own and control.
- Save before you spend. Prioritize building reserves over upgrading lifestyles.
- Invest, don’t just pay. Growing money is more valuable than servicing past expenses.
- Debt is a tool—use it wisely. Borrowing should serve a purpose, not fund unnecessary consumption.
The ultimate question isn’t just about income—it’s about autonomy. Are you building wealth, or are you simply working to keep up with payments? Understanding the difference could mean the difference between financial freedom and a lifetime of financial obligation.
