Selangor Journal

Almost 80% of Malaysians have no old-age savings

The volatile economic trend, incomes not corresponding with living cost, having to pay various bills, loans and taxes are the root causes Malaysians have no money left for savings.
The Statistics Department’s survey found the national average household income has increased by 6.2% to RM6,958 in 2016, from RM6,141 in 2014.
However, that does give the true picture of the situation when the average household expenses also increased from RM3,578 in 2014 to RM4,033 in 2016, which was a 6% increase.

  1. Malaysians, especially those in lower ranks, cannot save money every month after spending it on families, as their incomes are not in line with the rising cost of living.

In fact, more than 76 percent of Malaysians do not have enough savings for difficult times or ’emergencies’ where only 6 percent have enough money to survive for more than 6 months in times of emergency or difficult times. While another 18 percent have just enough savings to last for slightly over 3 months.

  1. Most of us are not well prepared to face ‘emergencies’ such as job termination and sickness causing them to exhaust all their savings within a short time.


To me, this relates to income and expenditure, If expenses increase but income do not increase correspondingly, there will be no savings.

  1. The average income per person has dropped by 15% from USD10,345 in 2013 to USD8,821 in 2016, showing that weak financial planning is not the main reason for low saving rate.

There are other factors causing it such as increase in price of goods including food, products and household services.

  1. Hence, with so much financial issues, retirement age which should be enjoyed with peacefully grandchildren will become a stressful period as some might have to look for small jobs to continue the balance of their life. Whereas old age is a phase in life for rest.

Some parents are forced to take additional loans for daily expenses. What more when their kids are also affected with heavy debts such as loans for car, housing, education and much more.

  1. Only 22 percent of the 6.7 million active Employees Provident Fund (EPF) members, aged 55, have sufficient savings of RM196,800 or more to support their retirement lives.

It’s a depressing reality when out of the 6.7 million active EPF members, 65% of them have less than RM50,000 saved.
Retirees need at least RM1500 to support themselves especially those living in urban areas and this amount is insufficient unless they are free from debt or have other savings.

  1. It seems that not only the workers are victims of Prime Minister, Datuk Seri Najib Razak’s administration, but all level of societies are affected.

It is not enough that we have to pay the Goods and Service Tax (GST) which by right should provide the government with a lot of funds but it also looks like since its implementation, people have been largely burdened and oppressed.
Dato’ Hj. Abd. Halim Hussain
Former Speaker for Penang State Legislative Assembly
Balik Pulau Branch Head
Peoples’ Justice Party

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