UDHAR KI ZINDAGI

Every month on the fifth, 26-year-old Sohom Niyogi watches a massive chunk of his ₹45,000 salary evaporate from his bank account. First comes the part-instalment for the flat he has booked in Kolkata.

Then comes the EMI for his swanky mean machine the Royal Enfield Bullet, followed by the one for the air-conditioner cooling his room. Add to that a highoctane weekend social life with his friends Sagnik, Soumyajit, and Atul— where they party like there’s no tomorrow—and the math simply stops working.

By the 25th of every month, Sohom is broke and relying on his father to bail him out until the next pay check hits. Ask Sohom, and he will tell you he isn’t being reckless; he’s just prioritizing comfort. “Many people my age take out loans for extravagant vacations,” Sohom explains. “After a long day’s work with a horrendous schedule, I just want to come back to a comfortable home.

That’s why I invested in my place and the furniture.

The weekends are literally the only time I get to step out.” Sohom isn’t an anomaly. In today’s Gen Z world, his behavior isn’t seen as irresponsible—it’s the cultural norm.

PAYCHECK TO PAYCHECK Across urban India, thousands of young earners are discovering that their salaries disappear long before the end of the month, consumed by a relentless mix of EMIs, subscriptions, rent, and lifestyle spending.

They aren’t defaulting on their obligations, nor do they view themselves in a crisis. But they aren’t building a financial cushion either. India’s booming retail credit market is increasingly powered by these young, digital-first borrowers.

Unsecured lending—personal loans, credit card balances, and BuyNow-Pay-Later (BNPL) schemes—is skyrocketing. A massive share of new borrowers are under the age of 35, entering the credit ecosystem through frictionless, instant appbased loans.

Historically, EMIs were reserved for long-term asset creation, such as buying a home or financing an education. Today, they fund daily lifestyle choices.

While individual smallticket micro-EMIs—say, ₹3,000 a month for a gadget—feel manageable in isolation, their collective weight quickly turns into a financial stranglehold.

It is not uncommon to see young executives earning ₹80,000 per month paying ₹35,000 to ₹40,000 in monthly installments. Combine a home loan with a vehicle loan, a high-end smartphone installment, and an appliance plan, and half their earnings are gone before the month even begins.

OF ALGORITHMS & SOCIAL ACCEPTANCE Financial experts point out that much of this borrowing isn’t about survival— it’s about keeping up appearances.

Driven by social media platforms that blur entertainment with consumerism, young adults feel constant pressure to project success. Whether it’s the latest iPhone, a MacBook, or a designer watch, the temptation always starts with the deceptively simple hook: “It’s just ₹3,000 a month.”

Before long, micro-borrowing becomes a macrohabit of living beyond one’s means. Studies show that over half of Indian youth are living paycheck to paycheck. Data from credit bureau reports highlights rising stress in small-ticket loans, particularly among borrowers under 30.

GOOD AND BAD DEBT The boundary between constructive and destructive borrowing is blurring daily. Personal loan interest rates typically range between 11% and 18%, quietly compounding and significantly inflating the true cost of depreciating lifestyle goods.

To curb this trend, financial advisors are urging young earners to follow a stricter version of the classic budget rule: Primary Needs First: Pay essential living expenses (rent, groceries, utilities). Prioritize Savings: Direct at least 20% of net income toward savings and investments.

Cap Your EMIs: Keep total monthly EMI obligations under 25%–30% of take-home pay. MACROECONOMIC REALITIES: WAGES VS. INFLATION It is unfair, however, to lay the blame entirely on lifestyle choices. Gen Z is coming of age in a challenging economic climate: Stagnant Entry-Level Pay:

Wages for entry-level positions have failed to keep pace with rapid inflation in rent, groceries, healthcare, and transit. Weakening Job Safety Nets: A Bank of America report noted that Gen Z unemployment benefit claims surged by 30% year-overyear—the sharpest increase of any demographic group.

Depleted Safety Nets: Discretionary income evaporates the moment an unexpected utility spike or car repair occurs, forcing young adults to prioritize day-to-day survival over long-term retirement accounts or emergency funds. MENTAL HEALTH AND THE “RETAIL THERAPY” LOOP

There is also an undeniable emotional component. Modern workplace stress, burnout, and anxiety frequently trigger impulsive spending as a coping mechanism.

When life feels overwhelming, ordering expensive takeout, buying a trendy gadget, or subscribing to multiple streaming services offers immediate comfort.

While Gen Z is rightfully more open about mental health than previous generations, there is a growing realization that emotional well-being and financial habits are deeply linked. When stress drives retail therapy, saving money feels like an uphill battle.

According to the India Gen Z Study, 93% of Indian Gen Z respondents attempt to save a portion of their income, but only 37% manage to do so regularly.

The desire to build security exists, but it constantly clashes with the urge to live in the moment. THE ULTIMATE RISK By adopting a “Kal Ho Naa Ho” philosophy, young urban Indians risk compromising their longterm financial freedom.

While lifestyle loans deliver instant gratification, spending beyond one’s means today creates severe barriers tomorrow—making major milestones like homeownership, emergency safety nets, and comfortable retirement increasingly out of reach.