RMFLS 2023 Shows Malaysians' Financial Resilience Despite Economic Challenges

The 2023 RinggitPlus Malaysian Financial Literacy Survey reveals how Malaysians managed their finances during a year of economic uncertainty. While many respondents took steps to improve their financial situation, the data shows mixed results some areas improved while others present ongoing challenges.

Nearly all respondents (94%) actively tried to address their financial concerns this year, showing determination to tackle money problems head-on. Yet significant challenges remain, particularly around emergency savings, scam awareness, and gender financial gaps.

Malaysian Financial Health: Steady But Concerning

More than half of Malaysians (55%) spend exactly what they earn or more each month. This figure remained unchanged from 2022, though it's considerably higher than the 43% reported in 2019 before the pandemic.

The spending patterns vary across generations. About half of Gen Z (51%) spend their entire income or more each month, which is actually lower than the national average and significantly better than Millennials at 60%.

Malaysian savings habits show little improvement. Currently, 71% of Malaysians save RM500 or less each month, virtually unchanged from 2022's 70% but significantly higher than the 56% reported in 2019.

Emergency Savings Continue to Deteriorate

The emergency savings situation has worsened over time. About 67% of respondents said their savings would only last less than 3 months if they maintained their current lifestyle. This represents a troubling trend from 53% in 2019 to 67% in 2023.

Despite these financial pressures, most Malaysians (74%) still believe they control their money well. The disconnect between confidence and actual financial preparedness suggests many may not fully grasp their vulnerability.

These money problems create emotional stress for 55% of respondents, who feel anxious, frustrated, or embarrassed about their finances.

Malaysians Take Action Despite Challenges

The positive finding is that 94% of Malaysians actively tried to improve their financial situation. The three most common strategies were:

• Spending less on entertainment and leisure activities (57%)
• Eating out less often (56%)
• Tracking expenses more carefully (55%)

These practical steps show awareness of spending patterns and willingness to make lifestyle adjustments, even if the results haven't dramatically improved savings rates yet.

Digital Payments Reach Maturity

Cashless payment methods have become the preferred choice for most Malaysians. QR payments scored highest with an average rating of 2.83 out of 4, followed by contactless cards at 2.77, compared to cash at 2.67.

E-wallet adoption remains high, with 91% of respondents using at least one e-wallet app, a slight increase from 89% in 2022. Gen Z leads usage intensity, with 31% using 3 or more e-wallet apps, compared to 24% of Millennials and 22% of Gen X.

Scam Crisis Affects Nearly Everyone

A concerning 94% of respondents encountered at least one potential scam or fraud attempt this year. The most common scams came through:

• WhatsApp or Telegram messages (70%)
• Calls claiming to be from authorities or financial institutions (61%)

This widespread exposure to fraud highlights the urgent need for better digital financial literacy. Despite high digital payment adoption, many Malaysians lack the knowledge to protect themselves online.

Credit score awareness remains low, with 57% of Malaysians either unaware of what a credit score is (33%) or knowing about it but not understanding its use (24%).

Social Media Becomes Primary Financial Information Source

There's been a significant shift in how Malaysians seek financial information. Social media now leads at 68% of respondents, higher than friends and family (60%) or traditional media (31%).

The trend towards social media for financial advice, combined with widespread scam exposure, creates risks. Malaysians need better skills to distinguish reliable financial information from misleading content.

Gender Financial Gap Widens

Women face greater financial challenges across multiple areas. Three-quarters of women (75%) save less than RM500 per month compared to 66% of men. Women also have less emergency savings, with 69% unable to survive three months on savings compared to 64% of men.

The savings gap creates bigger problems for women's futures. Fewer women are investing (44% versus 56% of men) and planning for retirement (51% versus 61% of men). These disparities suggest women will face greater financial insecurity as they age.

Retirement Planning Shows Mixed Progress

Malaysian retirement planning awareness has improved, with 56% having started retirement planning. Yet 44% haven't begun, and among those who haven't started, 24% don't know where to begin.

The need for planning is clear, only 17% of respondents believe their EPF savings will be sufficient for retirement.

Investment participation remains limited, with 51% of Malaysian adults not yet investing. Among those who do invest, popular choices include ASNB funds (62%), Unit Trusts (38%), and commodities like gold and silver (30%).

Younger generations show promise. Half of Gen Z respondents (48%) have begun investing, close to the national average of 49% and just behind Millennials at 50%. Their early start positions them well for long-term wealth building.

Almost half of respondents (48%) believe spending on life experiences is equally important as investing and saving for retirement, reflecting changing attitudes about money and lifestyle priorities.

Protection Gaps Leave Many Vulnerable

Many Malaysians lack basic financial protection. The survey found that 44% don't own a medical card, while another 13% rely solely on company-issued coverage.

Life insurance gaps are equally concerning, with 48% of respondents lacking life insurance policies. This is particularly worrying for the 46% of respondents with dependents who don't have life insurance.

Despite digital payment adoption, insurance purchasing remains traditional. Two-thirds of respondents (67%) prefer buying insurance offline through an agent rather than online.

Gen Z Challenges Stereotypes

The survey data contradicts common assumptions about Gen Z's financial irresponsibility. Gen Z Malaysians show similar or better financial habits compared to other generations in many areas. They spend less of their income than Millennials and show strong investment participation rates.

Their digital nativity gives them advantages in navigating modern financial tools, though they still need better education about scam protection and basic financial concepts like credit scores.

The Road Ahead

The 2023 RMFLS reveals Malaysians adapting to economic challenges with practical steps, even when those efforts haven't yet translated into significantly improved financial outcomes. The stability in key metrics like savings rates, while not ideal, represents avoiding further deterioration during a difficult economic year.

Key priorities for Malaysian financial health include improving emergency savings, addressing the gender financial gap, enhancing scam awareness, and helping the 44% who haven't started retirement planning take their first steps.

The high level of active effort to improve finances (94% of respondents) suggests Malaysians have the motivation to build better financial habits. The challenge lies in translating that motivation into more effective strategies that produce measurable improvements in savings and financial security.

Download The RMFLS 2023 Report

This analysis covers the key findings from our 2023 survey. Download the complete RMFLS 2023 Report (PDF) for detailed methodology, regional breakdowns, and expert analysis.

Want to see the evolution of Malaysian financial attitudes? Check out our previous reports:

• RMFLS 2022 Report
• RMFLS 2021 Report
• RMFLS 2020 Report
• RMFLS 2019 Report