India’s biggest financial scam doesn’t involve fake apps or market fraud — it begins at home. Chartered Accountant Nitin Kaushik has warned that millions of Indians are quietly losing lakhs every year, not to fraudsters, but to their own financial behaviour. Kaushik, in his recent post that has gone viral among finance circles, called it the “behavioural money trap” — a pattern of overspending, procrastinating investments, and confusing income with wealth. He says the true wealth drain in India isn’t happening through scams or hacks, but through habits that feel normal.
“Someone earning ₹50,000 and investing ₹5,000 every month will be richer than someone earning ₹2 lakh and spending ₹2 lakh,” Kaushik wrote, calling the trend India’s ‘biggest financial scam.’
What is the ‘Financial Scam’
The trap begins innocently — a missed SIP, an impulse purchase, or the belief that investing can wait “till next month.” But repeated over time, these actions create a silent wealth drain. As income rises, so does lifestyle spending. Salaries grow, yet savings stay stagnant. People often mistake higher earnings for financial progress, when in reality, discipline — not income — builds wealth.
According to Kaushik, many working professionals fall into the same pattern: they start earning well but fail to invest consistently; lifestyle expenses rise faster than income; investments are postponed indefinitely; and years later, they realize their savings haven’t grown at all.
Kaushik calls it a behavioural scam because it tricks people the same way fraudsters do — by exploiting emotions. In this case, it’s not greed or fear, but comfort and delay. Every time someone says “I’ll invest later”, or “I deserve this luxury now”, they unknowingly participate in this mental trap. It’s not an external con — it’s self-sabotage disguised as financial freedom.
“The biggest wealth destroyer isn’t bad markets or scams — it’s our inability to say no to unplanned spending,” Kaushik noted.
What Lies Ahead
Kaushik suggests small but consistent steps to reverse the trend: start now — even ₹5000 invested monthly can grow into lakhs over time; automate savings — set up SIPs or auto-debits so you never “forget” to invest; track lifestyle creep — don’t let rising income justify unnecessary expenses; and review monthly — make financial discipline a habit, not an event. He emphasizes that consistency beats timing. Waiting for the “right time” to invest is just another delay tactic that keeps people stuck in the same cycle.
Kaushik’s post has resonated widely because it reframes financial awareness — it’s not just about avoiding scams, but about protecting ourselves from behavioural pitfalls. In a country obsessed with earnings and side hustles, the message is blunt: you don’t need to earn more — you need to save smarter. The so-called “biggest scam” doesn’t need a fraudster to operate. It runs on autopilot, powered by every delayed investment, every impulsive swipe, and every paycheck spent too soon.
As Kaushik concludes, “Think before you spend, automate before you forget — because the thief of your wealth might just be your own habit.”
