Why India’s middle class stays broke and how to break the cycle: CA’s survival guide to tackle financial struggles

The middle class in India faces a tough financial reality. Rising costs of living — spanning housing, education, and healthcare — outpace wage growth, making stability harder to achieve. Limited access to quality public services further strains household budgets, leaving many families in a perpetual financial bind.  

Amid these challenges, chartered accountant Nitin Kaushik took to X (formerly Twitter) to outline why many middle-class Indians feel stuck and, more importantly, how they can break free.  

"Being middle class isn’t just about earning decently — it’s about fighting financial struggles at every stage," he wrote, before laying out key problem areas and solutions:  

"1️⃣ Retirement? Most Are Unprepared  
While EPF and PPF seem like good options, inflation erodes savings. ₹1 Cr today won’t be worth much in 30 years.  
✅ Fix: Start SIPs in equity mutual funds. Aim for 20-30x annual expenses for a secure retirement.  

2️⃣ Education Costs Are a Silent Killer  
School and college fees are rising faster than salaries. By the time a child reaches college, costs could double.  
✅ Fix: Build an education fund early — PPF, Sukanya Samriddhi (for daughters), or equity investments can help stay ahead.  

3️⃣ One Medical Emergency Can Ruin You  
Employer-provided health insurance might not be enough when medical bills hit ₹10L+.  
✅ Fix: Buy a ₹10-20L health insurance plan and add critical illness cover for financial protection," kaushik warned.  

“💡 Truth bomb: Most middle-class families work hard but remain trapped in this cycle,” he concluded.  

Beyond personal finance struggles, systemic issues such as bureaucratic inefficiencies and weak infrastructure further limit upward mobility. Middle-class families often find themselves caught between managing daily expenses and securing their future, creating a cycle of financial stress that is difficult to escape.