'Don't believe your balance': CA Abhishek Walia breaks the illusion that make people misjudge their usable income

Opening a banking app and seeing a six-figure balance often gives a sense of comfort and security. But Chartered Accountant and co-founder of Zactor Money, Abhishek Walia, warns that this figure can be dangerously misleading. In a post shared on LinkedIn, he explained that people often mistake their account balance for available wealth, overlooking the fixed and recurring expenses that quietly drain their income each month.

According to Walia, the typical flow of expenses tells a different story. For example, someone with ₹1.2 lakh in their account may feel financially comfortable, but once essentials like ₹20,000 for rent, ₹12,000 for groceries, ₹8,000 for EMIs, ₹5,000 for utilities, ₹15,000 for SIPs, and ₹10,000 for transport and leisure are deducted, the actual usable amount shrinks drastically. What remains—roughly ₹30,000—is the true disposable income. Yet, few people consciously calculate this before spending.

Why most people misjudge their finances

Walia attributes this misjudgment to what economists call mental accounting. It’s a common behavioural trap where people mentally divide their money into categories like salary, savings, and bills, assuming each pot is separate. In reality, he points out, all income comes from the same source and serves multiple purposes. This fragmented view often makes overspending feel harmless and debt appear manageable, when in fact both are symptoms of poor financial awareness.


The Chartered Accountant explains that many individuals treat their entire balance as “available money,” which creates a false sense of abundance. This illusion leads to lifestyle inflation, impulsive purchases, and limited long-term savings. “That’s why overspending feels normal, credit card debt feels ‘manageable,’ and savings never grow,” he wrote in his post.


From balance to budget: the real measure of wealth

Walia’s message underscores the need for mindful budgeting. He advises that rather than trusting the balance reflected in a banking app, individuals should focus on what remains after accounting for expenses, taxes, and time. “Don’t believe your balance. Believe your budget,” he emphasized, reminding readers that genuine financial health depends on what’s left, not what’s visible.