In the fast lanes of India’s booming cities, luxury cars are no longer just vehicles — they’re statements. A shiny badge on the hood has become a modern-day certificate of success. But what happens when that success is financed, not earned?
A viral post by Chandralekha MR, founder of Dime, recently threw light on a growing and dangerous financial trend: professionals earning ₹2 lakh a month driving home in ₹80 lakh cars — and sinking 60% of their income into monthly EMIs.
It’s not just a financial misstep; it’s a reflection of how the middle class is slowly losing its grip on reality, trading long-term security for short-term validation.
The Expensive Flex Phenomenon
It started with a Reddit post from a car showroom employee. The employee revealed that several customers earning around ₹2 lakh a month were purchasing high-end vehicles — mostly Mercedes or BMWs — worth ₹70–₹80 lakh.
The math is astonishing:
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Down payment: ₹7–₹9 lakh
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Loan tenure: 7 years
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Interest rate: ~9%
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Monthly EMI: ₹1.2 lakh
That’s nearly 60% of the person’s take-home salary — just for the car loan.
Now add fuel, maintenance, insurance, and rent, and you’re left with financial chaos disguised as “luxury living.”
Chandralekha summed it up perfectly in her post:
“Instagram tells us luxury cars equal success. But does your bank account agree?”
The “Flex Culture” Epidemic
The rise of social media has redefined success. Every scroll through Instagram or LinkedIn brings another post of someone “making it big.” A new car delivery, a brand-new iPhone, a vacation in Europe — all presented as milestones.
This has created what experts call “the comparison trap” — a cycle where people spend to appear as successful as their peers. The result?
Debt-funded lifestyles and declining savings.
People are no longer buying cars to travel; they’re buying them to be seen.
Middle-Class Math: When the Numbers Stop Making Sense
India’s middle class forms the backbone of the nation’s economy. But with rising aspirations and easy credit, financial discipline is slipping.
Here’s the reality check:
| Annual Income | Recommended Car Budget (Based on 20/4/10 Rule) | What People Are Actually Buying |
|---|---|---|
| ₹24 lakh | Up to ₹12 lakh | ₹70–₹80 lakh cars |
| ₹12 lakh | ₹6 lakh | ₹30 lakh cars |
| ₹6 lakh | ₹3 lakh | ₹15 lakh cars |
Financial planners recommend that no more than 10% of your income should go toward a car EMI. But many are spending six times that amount — just to “fit in.”
Lifestyle Inflation: The Silent Enemy
As incomes rise, spending rises faster. This phenomenon, known as lifestyle inflation, is eating into savings.
Someone who once lived comfortably on ₹1 lakh a month now struggles with ₹2 lakh because every upgrade — apartment, phone, watch, or car — brings more expenses.
What used to be luxuries have now become expectations. And that expectation is being exploited by marketing, banks, and social media.
The Hidden Costs of a Luxury Car
Buying a ₹70 lakh car doesn’t just mean a one-time payment. The financial burden continues every month — often longer than the excitement lasts.
Here’s what most people forget:
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Depreciation: A new car loses 10–15% of its value instantly when it leaves the showroom. After 5 years, it’s worth barely 50%.
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Maintenance: Luxury cars can cost ₹50,000–₹1 lakh annually in maintenance.
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Insurance: High-end models can have insurance premiums of ₹1 lakh+ per year.
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Fuel: Premium fuel and low mileage mean ₹10,000–₹15,000 monthly.
That’s not a car — it’s a liability on wheels.
Psychology Behind Overspending: Buying Validation
Psychologists say this pattern stems from a mix of insecurity, social comparison, and dopamine-driven gratification.
When someone buys a luxury car, it triggers admiration and validation — temporarily boosting self-esteem. But the emotional high fades quickly, leaving behind financial stress.
As Chandralekha pointed out:
“Are you buying because you need it, or because you want people to think you’ve made it?”
The problem isn’t desire — it’s disconnection from reality.
The New Middle-Class Paradox
For earlier generations, owning a house was the ultimate dream. It symbolized stability.
For today’s professionals, it’s often about symbolism over substance.
We’ve moved from “I want to be comfortable” to “I want to look successful.”
The irony? Many who flaunt luxury cars don’t even own assets that appreciate — like real estate or equity. They’re building a lifestyle, not wealth.
Experts Sound the Alarm
Financial planners and economists are now warning that India’s middle class is consuming more but saving less than ever before.
According to the Reserve Bank of India, the household savings rate fell to 5.1% in 2023–24, the lowest in over a decade. Meanwhile, consumer credit (personal and vehicle loans) rose sharply.
Wealth advisor Harini Vaidyanathan explains,
“It’s no longer about what you can afford. It’s about what you can show. The danger is, we’re trading financial freedom for social approval.”
The Trap of Easy Credit
Banks and car companies are cashing in on this mindset. Long-tenure loans, low down payments, and “instant approvals” make luxury feel accessible.
But here’s the catch:
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A 7-year loan means you’ll be paying interest long after the car’s value has dropped drastically.
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If your income fluctuates or an emergency hits, you risk default and poor credit scores.
Easy loans are not opportunities — they’re temptations disguised as convenience.
Freedom vs Flex: What Wealth Really Means
Owning a luxury car might feel good — but owning your time, choices, and peace of mind feels better.
True wealth is:
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Having money left after every expense.
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Being debt-free.
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Knowing your assets grow while you sleep.
A luxury car might get you attention, but financial freedom gets you control.
As Chandralekha wrote,
“True wealth isn’t a car in your driveway. It’s the ability to say no — to things that don’t make sense for your future.”
What You Can Do Instead
If you’re tempted to buy beyond your means, here’s how to reset your financial thinking:
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Set priorities, not trends. Ask: will this expense improve my life or my image?
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Follow the 50/30/20 rule. Spend 50% on needs, 30% on wants, save/invest 20%.
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Don’t buy dreams on EMI. Save first; then spend.
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Remember depreciation. Cars lose value; investments grow value.
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Seek joy in security, not symbols. Confidence doesn’t need a logo.
A Mirror to Modern India
This debate isn’t about cars — it’s about mindset.
India’s middle class has always been aspirational, but in recent years, aspiration has turned into addiction — to validation, luxury, and appearances.
Social media glorifies consumption, but hides the reality behind it.
What used to be a tool for connection has become a scoreboard of self-worth.
And in this game, no one truly wins.
The Real Flex: Living Debt-Free
In a world obsessed with showing off, the ultimate flex is financial peace.
Owning assets that appreciate, having savings that protect you, and living without EMI anxiety — that’s the new definition of success.
The car will rust, the likes will fade, but the freedom to choose your life — that stays.
So before you sign that car loan, ask yourself one honest question:
“Am I buying this for my comfort — or for applause?”
Because true success isn’t measured by what you drive, but by how freely you live.
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