CTC - 10LPA —- Take home - ₹70,900 per month
CTC - 20LPA —- Take home - ₹129,000 per month
CTC - 30LPA —- Take home - ₹181,000 per month
CTC - 40LPA —- Take home - ₹233,000 per month.
A 2X increase in CTC doesn’t lead to an equal rise in in-hand.
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What leads to such a gap?
> Joining bonus: This bonus is a one-time payment made in the 1st year and isn’t available next year but is still included in CTC!
> Variable pay: This is contingent upon meeting targets if you don’t, the bonus may not be paid to 100% extent.
> ESOPs: This inflates the CTC and decreases in-hand. Though these can be valuable in the long term and are typically vested after 4 years.
> Non-cash perks: A ton of non-cash perks like meal coupons, and vouchers worth thousands are part of your CTC but don't add up to liquid cash in hand.
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What can you do?
Smartly negotiate for components that increase your take home.
Suppose the basic salary is set at 40% of your CTC, negotiate to increase it to 50%. This will increase your take-home and also boost retirement savings.
Thoughts?
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This post was originally shared by Chandralekha MR on Linkedin.