The Economic Times

Got a salary hike? Your extra Rs 25,000 could disappear without you noticing. CA suggests what to do first after your salary gets credited

A salary hike can quickly disappear into higher EMIs, credit card spending, BNPL purchases and lifestyle upgrades. CA Nitin Kaushik advises using an increment to strengthen your finances first. After paying minimums on all debts, he suggests attacking the highest-interest debt, freeing monthly cash flow and then increasing investments. With credit cards charging far more than home loans, aggressively prepaying low-cost debt while carrying expensive debt may not make financial sense.