Manage spending, find ways to increase income, financial specialist says

SHAH ALAM - Malaysians need to control their spending and prioritise their needs compared to wants in facing the challenging economic state, says Consumer Finance Specialist Professor Dr Mohamad Fazli Sabri.

He said the measures were basic considerations when faced with the issue of economic recession.

"We need to coordinate our lifestyle with prioritising matters involving the continuation of family and personal life.

"The priority meant among the matters of healthcare and protection, children's education and retirement preparations.

"In the current duration we should not be focused on expenditures such as gadgets, home renovations and a change of vehicles," he said.

The Universiti Putra Malaysia Faculty of Human Ecology Dean said those who struggled with insufficient income needed to find ways of adding to it through part-time work or raise their skills.

"We need to think about the lifelong learning skills as well.

"Diversify skills by attending courses that are held online primarily those in the high demand sectors now and in the future such as gig economy and online commerce," he said.

Fazli said both measures taken were supposed to be done now as a precaution to face the economic situation next year.

He explained the emergency funds needed by an individual or family now is at least six to 12 months from the gross income or their monthly expenditure.

"Let’s say a monthly expenditure is RM4,000 the savings needed is around RM24,000 (six months) to RM48,000 (12 months).

"If the gross income is RM6,000 a month there needs to be a savings of RM36,000 or RM72,000.

"Savings are important for example if a person was retrenched, it could be used to pay for the home, vehicle and ensure the continuity of personal and family lifestyle," he said.