The RinggitPlus Malaysian Financial Literacy Survey is back for 2020. Over 10,000 people across Malaysia shared how they managed their money through the most challenging economic period in recent memory.
This year's findings reveal two major shifts in Malaysian financial behaviour. The pandemic accelerated our adoption of digital payments beyond anyone's expectations, with nearly 9 out of 10 Malaysians using contactless payments. The economic uncertainty exposed just how unprepared most of us remain for retirement, despite widespread awareness that EPF alone won't be enough.
Digital Payments Became the Default
COVID-19 completely transformed how Malaysians handle money. A massive 88% of respondents use contactless or cashless payments, compared to much lower adoption rates in previous years.
E-wallet usage exploded to 90% of respondents nationwide. Touch 'n Go eWallet leads the pack as the most popular choice, used by 52% of respondents. Boost follows at 23%, with GrabPay capturing 20% of users.
| Survey Question | Responds | Percentage of Respondents |
| Which are your most used e-wallet apps? | Touch 'n Go eWallet | 52% |
|
Boost
|
23% | |
| GrabPay | 20% | |
| Others | 6% |
The shift was about safety as well as convenience. The pandemic made everyone comfortable with electronic payments and wary of handling cash. A substantial 39% of respondents moved their entire financial management online during 2020.
Young Malaysians Dominated Digital Adoption
Malaysians under 35 became digital payment champions during the pandemic. An impressive 93% own at least one e-wallet, and 30% actively use three or more different platforms. This generation embraced the entire digital ecosystem.
Young Malaysians used the pandemic to completely digitise their financial lives, from banking to investment tracking. They lead older generations by significant margins across every digital payment metric.
The Retirement Planning Crisis Deepened
Retirement planning remains our biggest financial blind spot. The numbers are alarming: 70% of respondents believe EPF alone won't fund their retirement, yet 39% still haven't started any retirement planning.
Malaysians expect their EPF savings to run out quickly:
| Survey Question | Responds | Percentage of Respondents |
| How long do you expect your EPF savings to last during your retirement? | 1-5 years | 39% |
| 6-10 years | 28% | |
| 11-15 years | 14% | |
| 16-20 years | 9% |
Two-thirds of Malaysians (67%) believe their EPF will only last less than 10 years in retirement. This means the average Malaysian expects to outlive their primary retirement savings by decades.
Retirement Awareness Without Action
The most puzzling finding is the gap between awareness and action. Among respondents who worry that their EPF won't be enough, 45% still haven't started any additional retirement planning. They recognise the problem but aren't solving it.
When Malaysians do plan for retirement beyond EPF, their choices show smart thinking:
- Employees' Provident Fund (EPF): 83%
- Unit trusts and mutual funds: 38%
- Fixed deposits: 31%
- Private retirement schemes: 23%
- Endowment plans: 12%
Unit trusts and mutual funds rank as the second most popular retirement planning tool, chosen by 38% of respondents. Malaysians understand they need growth-oriented investments to build adequate retirement savings, even if many haven't acted on this knowledge.
EPF Withdrawal Preferences Show Strategic Thinking
Most Malaysians (68%) believe they should be allowed to withdraw EPF savings before retirement. Among those who would consider early withdrawal, their intended uses show careful planning:
- 25% plan to use the money for investments
- 24% would pay down home loans
- 23% would reduce other loan payments
These responses suggest Malaysians view EPF withdrawal as a tool for overall financial optimisation rather than immediate consumption.
Young Malaysians Excel Digitally But Struggle Financially
The generational divide in financial management became stark during 2020. While young Malaysians under 35 dominated digital payment adoption, they struggled with basic financial management.
Almost 60% of young Malaysians can't survive three months on savings, compared to 53% nationally. Nearly half (47%) spend everything they earn or more, slightly above the 46% national average. Most alarming for their long-term financial health, 50% haven't started retirement planning compared to just 39% nationally.
Something oif a contradiction, the younger generations are the most digitally sophisticated with money yet also the least prepared for financial emergencies and retirement. The tools and platforms they've mastered during COVID-19 could become powerful wealth-building instruments if they develop the underlying financial habits to match their digital skills.
COVID-19 Delivered Hard Financial Lessons
The pandemic served as an unexpected financial education course for many Malaysians. A significant 27% of respondents realised they needed emergency funds during the crisis - a lesson learned through experience rather than advice.
The government's loan moratorium programme helped 7.7 million borrowers navigate the economic uncertainty, but our analysis reveals lingering problems. About 16% of borrowers weren't prepared to resume payments when the moratorium ended, potentially affecting 1.2 million people. Only 640,000 applied for post-moratorium assistance, leaving approximately 580,000 at risk of default.
Emergency Savings Showed Little Improvement
Despite the pandemic's demonstration of why emergency funds matter, Malaysian savings habits showed little improvement from 2019. More than half of respondents (53%) still couldn't survive on their savings for three months if they lost their income.
| Survey Question | Response | Percentage of Respondents |
| If you lose your job, and all you have are your savings, how long do you think you can survive with your current lifestyle? | I can't survive for more than a month | 22% |
| I can get by for 1-3 months | 31% | |
| I can survive for 3-6 months | 19% | |
| I think I could last over 6 months comfortably | 27% |
The situation actually worsened in some areas. Now 46% of respondents spend everything they earn or more, up from 43% in 2019. Most Malaysians (69%) save less than RM1,000 each month, and 19% save nothing at all.
Malaysia Digital Success, Financial Planning Gaps
The RMFLS 2020 captured Malaysians at a turning point. We proved remarkably adaptable when it came to digital payments, embracing new technologies that will likely define how we handle money for years to come. This technological leap forward created opportunities for better financial management that didn't exist before 2020.
The survey also exposed persistent gaps in fundamental financial planning. The retirement savings crisis hasn't improved despite increased awareness, and emergency savings remain inadequate for most Malaysians even after a year that demonstrated their critical importance.
The digital payment revolution of 2020 provides a template. If Malaysians can adapt this quickly to new ways of spending and managing money, we have the capability to tackle retirement planning and emergency savings with similar urgency and success.
Download The RMFLS 2020 Report
Our analysis covers the key findings from our 2020 survey, but there's much more to explore. Download the full RMFLS 2020 Report (PDF) for detailed methodology, regional breakdowns, and expert analysis.
Want to see how Malaysian financial attitudes evolved? Check out our previous RMFLS 2019 Report to track the changes over time.