New Delhi, Aug. 19 -- Many high earners feel financially stretched despite healthy salaries. Abhijit Kumar, a SEBI-registered investment adviser, has shared a practical solution on LinkedIn. He outlined a five-step financial audit that takes just 20 minutes.

Kumar illustrated the problem with a real client. The client earned Rs.2.1 lakh per month but could not save Rs.40,000 for an emergency fund. The audit revealed why.

Pull out the last three bank statements and total every EMI. Include so-called no-cost ones. Kumar's client believed his EMIs totalled Rs.35,000. The actual figure was Rs.68,000, which was 32% of his take-home pay.

The rule of thumb is clear. All EMIs combined should stay below 40% of take-home income. A home loan alon...