How to fix being broke by month-end

“Beware of little expenses. A small leak will sink a great ship.” Benjamin Franklin reportedly said this nearly 300 years ago. The proverb rings especially true in today's age of hyper-consumption.

- Lisa Pallavi Barbora

Those few thousand rupees you’re falling short by every month are a leak you’re probably not trying hard enough to fix. The big payments — rent, EMIs, school fees, fuel costs and so on — are well accounted for. It’s the smaller expenses that are easy to overlook. Multiple food deliveries to satisfy untimely cravings, a few extras in your grocery basket that set you back a couple of thousand rupees each time, that imported fruit or coffee from a popular café chain — it all adds up.

Thanks to the shift towards digital payments, many of these seemingly insignificant purchases stay hidden behind four-digit PINs.

Each individual payment may be too small to register, but together they can build into a surprisingly large monthly outflow. You promise yourself that next month you’ll do better, but behaviour has become habit, making it hard to stop. High earners aren’t immune. “I’ve seen ₹8 lakh/month earners more stressed about cash flow than someone earning ₹80,000. Higher income often makes the leaks bigger, not smaller — lifestyle simply expands to match the salary. Without a system, a raise just means you go broke at a more expensive standard of living,” says Khyati Mashru Vasani, founder and chief financial coach, PlantRich Consultancy LLP.

Does a bit of impulsive spending really matter?

Data (see Table 1) from the past few years suggests India’s consumption growth may well be riding on borrowed money. Credit card spending in metro cities and the rise of buy now, pay later (BNPL) schemes — estimated at $30-37 billion — across Tier 1 and Tier 2 cities are difficult to ignore.