Tuesday, 2 December 2014

Confessions Of A Malaysian

Here’s a brief introduction to my life. I went to university at the age of 18, right after my SPM. My family scraped some cash to put me through Diploma. I started my ACCA course at the age of 21. I then took MARA loan and completed my ACCA. I got a job, moved up the ladder a couple of times, and here I am 10 years later.

Here I am, in debt.

Malaysia's household debt has risen to 86.8 percent of the country’s gross domestic product (GDP) at-end of 2013. We now hold the record of having one of the highest household-debt-to-GDP level in Asia. Meanwhile, the average Malaysia household debt servicing ratio is 43.5 percent and 60 percent for government servants. 

What it means is, on average, more than half of a Malaysian's salary goes to paying debts (housing, vehicle and credit card loans.) 

Which probably also explains why majority of Malaysians have zero savings. The Malaysia Human Development Report 2013 this week revealed that nearly 90 percent rural and 86 percent urban households, had no savings. Meanwhile, 53 percent of households have no financial assets.

What it means that roughly one in every two Malaysians are vulnerable in the event of loss of income. It also means that if a breadwinner falls sick and loses his/her job, the family will find it very difficult to make ends meet. Loans will be at high risk of being defaulted. 

So, it will probably come as no surprise that bankruptcy cases in Malaysia are on the rise too.And this leads me to what most Malaysians want (or need) but are finding it increasingly difficult to afford – property. The average residential property prices in Kuala Lumpur, Penang and Johor had jumped more than 30 percent last year. 

Meanwhile, salaries have not kept up with the soaring property prices. Salary increases remains in single digits. Also, inflation is set to increase next year too with rising living costs triggered by the implementation of GST and the roll back subsidies on fuel, electricity and sugar.

How many of us are free from debt? Forget about credit card debts or personal loans that people take to fulfill superficial materialistic wishes. I am talking about the basic needs in society: education, housing, healthcare and transport.

Is our nation so broken until a youth in his 20s has to be burdened by thought of how is he going to carefully plan his finances for the next 30 years? I agree that financial planning is an integral part of modern life, but to push it to this level where you are burdened by the simple idea of surviving in your homeland is absolute madness.

Life is meant to be lived. How many of us can claim that we work because we want to, not because we have to? Where is the quality in your life – if you have to spend ungodly hours at work, then braving the traffic jams, only to come home to work on your “side gig” to earn that little bit more to pay for the domestic help service that cleans your home while you and your partner are at work?

How many hours are we able to sit down and chat with loved ones without being distracted on matters that are supposed to be trivial?

The fact is, most of us are caught in this cycle. We sit down to think about this yet we seem so helpless. Scrap that. We are more prone to arguing about who gets to call god what and who gets to enter houses of worship. We prefer to picket about artistes’ “inappropriate dressing”. Our debates are on racial rights and how the press misquoted our words.

Naysayers will accuse me of not doing enough research and coming out with statistics and jargon. They will say that I should work hard to break free and attain my own freedom. God knows I do try as hard as I possibly can. And I don’t want to research on loan statistics and banking regulations as I speak from my heart. So too, do many Malaysians. For most of us, there is simply no time to look for answers because that time is needed to keep moving to stay afloat in life.

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