In a world where most people chase wealth but few truly understand how money works, Chartered Accountant Nitin Kaushik has simplified the financial game with a viral post on X (formerly Twitter).
His post, titled “7 Financial Terms Everyone Must Know to Get Rich,” breaks down key money concepts that can transform how individuals approach saving, spending, and investing.
Kaushik began by emphasising the importance of net worth – calling it a person’s “real financial report card.” He explained that net worth is the difference between what you own (assets) and what you owe (liabilities). The goal, he said, should be to push that number higher each year through consistent saving, investing, and debt reduction.
The second concept, liability, represents debts that pull down one’s financial health. “Not all are bad,” Kaushik noted, citing housing loans as an example of debt that can create appreciating assets. However, he warned that high-interest debts like credit card dues are “financial poison” and should be cleared first.
On the other hand, assets – from real estate and gold to stocks and intellectual property – are wealth builders. Kaushik advised focusing on appreciating assets that grow in value over time.
He also revisited one of finance’s most powerful ideas: compound interest. Quoting Einstein’s famous description of it as “the 8th wonder of the world,” Kaushik demonstrated how consistent investing can yield exponential returns. For example, investing ₹10,000 monthly at 12% annual growth can grow to over ₹23 lakh in a decade – showing how time and patience amplify wealth.
Moving on to income, Kaushik highlighted the importance of diversification. “The average millionaire has seven income streams,” he wrote, urging followers to go beyond salaries and explore additional sources such as rent, dividends, or freelance work.
When it comes to budgeting, Kaushik stressed that wealth isn’t built by how much one earns but by how much one keeps. He recommended tracking every rupee, categorizing expenses into needs, wants, and wishes – and controlling the latter two to unlock real savings.
Finally, he clarified the difference between gross and net income, a common confusion among young professionals. “Focus on net income, not the fancy CTC,” Kaushik advised, reminding readers that what matters is the amount that actually reaches their account after taxes and deductions.
Closing his thread, Kaushik summed it up succinctly, “Wealth isn’t about luck – it’s about financial literacy. Once you understand money, you stop chasing it… and start multiplying it.”