61% of Malaysians Struggle to Raise RM1,000 for Emergencies

61% of Malaysians Struggle to Raise RM1,000 for Emergencies

Results from Bank Negara Malaysia (BNM)’s Financial Capability and Inclusion Demand Side Survey 2024 showed that 61 percent of Malaysians face difficulty to raise RM1,000 as emergency fund. This seems to have gotten worse as it was 52 percent in 2018 and 47 percent in 2021. Briefly, this meant that we have even more Malaysians who say they could not raise RM1,000 as emergency funds. Many reasons were stated including rising cost of living and even the possibility of overspending too. Source: bam.gov.my

The state of financial unpreparedness is not limited to just Malaysians

Do take a look at below: Americans, Australians and UK adult population.

Article in nbc.com: “In fact, 1 in 3 Americans say they don’t have an emergency fund. And the median amount Americans say they have saved for emergencies is $500, according to a survey conducted by financial services company Empower in June.

That’s $100 less than a median amount of $600 reported in the same survey conducted a year ago by Empower.

“The study suggests financial precarity at a time when household finances may be stretched due to rising prices and inflation,” Rebecca Rickert, head of communications at Empower, said in the study.” Article in nbc.com:

Article in finder.com.au: “A Finder survey of 1,034 Australians revealed almost 2 in 5 (37%) – equivalent to 7.9 million people – don’t have enough cash in savings to cover 3 months of essential living costs.

The research shows 1 in 5 (20%) admit they don’t have enough emergency savings and are finding it ‘very difficult’ to save.

Nearly 1 in 10 (9%) don’t have a 3-month savings buffer but are actively saving towards it.

A further 8% say they don’t think a 3-month emergency fund is necessary..” Do read more here: Article in finder.com.au:

Article in bbc.com: The findings suggest that 13 million people – a quarter of the UK adult population – have low financial resilience. That means they have debts that are hard to manage, low savings, and have missed a series of bill payments.

This was unchanged when compared with the previous Financial Lives survey, published in 2022, despite the pressure caused by inflation and rising essential bills on personal finances.

Some 10% of those asked had no cash saved at all. Another 21% had less than £1,000 tucked away. Article in bbc.com:

What could we do?

Earn – Save – Invest – Protect. Strive to earn more but do not spend more. Once we could earn more, we have chance to build up savings which could then be put into investments and also protection to ensure we are covered against any sudden financial loss. Buying insurance is not a cost yeah. It’s an investment to protect against uncertainty.

Remember, just one trip to the emergency ward would wipe out many years’ of savings. If we do not save enough and we lose our job, the financial situation will worsen very quickly. This is why it does not help if we do not earn enough and yet we are not thinking of ways to earn more. Maybe find something we love to do? Bake… Teach… Drive…. Ride… There are opportunities everywhere. Remember, when nothing changes, nothing happens.

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