Malaysian Millennials Are Guilty Of These Money Mistakes
Youths in their 20s and 30s make up a large percentage of the Malaysian population and workforce today and their life choices and financial habits have a big impact on the economy and society.
They are known as the millennial generation or Generation Y, and loosely groups Malaysians born from 1981 to 1996 into this category.
Much has been said about their collective habits, thoughts and preferences but one factor that will have far reaching impact is how this generation is managing their finances.
According to a study by the Asia Institute of Finance, millennials in Malaysia are facing mounting debt problems at a young age.
How are millennials in Malaysia managing their money and credit?
A Bloomberg report earlier this year had raised alarm bells over millennials facing US$1 trillion in debt. According to the New York Federal Reserve Consumer Credit Panel, debt owed by 19 to 29-year-old Americans exceeded $1 trillion at the end of 2018.
The report highlighted that this is the highest debt exposure for this age group since late 2007 and a large chunk of it comes from student loans. When millennials end up missing student loan repayments, such as PTPTN loans, their credit profile is badly affected for years.
While there are no specific studies on Malaysian millennials and their credit rating, the jury is still out on whether this generation is doing a good job in managing money.
Our own iMoney Millennial Survey revealed that Malaysians aged between 21 and 36 years old are incurring debt-to-income at a ratio of above 50% which will likely affect their credit rating. This makes it much more difficult to apply for products such as credit cards, personal loans, mortgages and car loans.
If you are in their 20s and 30s now, what are the financial pitfalls you should be on the lookout for?
We rounded up the key highlights from recent surveys on millennials financial health to give you a snapshot of how Malaysian millennials are managing their money.
Knowing where you stand in your credit rating is the first step towards improving your finances.
You can easily find out how financially healthy you are by using iMoney CreditScore which takes just minutes and is completely free.