Money not enough

A interesting article from our newspaper The Edge.
KUALA LUMPUR: 6 in 10 Malaysians feel they are not saving enough, with 15% saying they have no savings at all, according to a recent HSBC survey.

The recent HSBC Asian Insurance Monitor found that for over half of the Malaysian respondents (55% vs 45% in an earlier 2009 survey), the main barrier to long-term savings plan was the lack of disposable income to buy insurance.

In a statement on Jan 28, HSBC said most respondents (54%) cited the lack of investment products with desired returns as the major obstacle in the first half of 2009.

Fieldwork for the survey, which was commissioned by HSBC Insurance, was conducted by Nielsen in December 2009 among 480 Malaysian respondents of the general working segment aged between 35 and 65 years.

It said the survey also showed that across most Asian markets, lack of confidence in the market continued to be the main barrier to saving for the long term.

In terms of monthly personal income distribution, people in Malaysia allocate the smallest proportion (25%) of their monthly income to financial services, including cash (8%), investments (4%), insurance (10%) and pension (2%).

The survey further reveals that while Malaysia retained its strong property-orientation with over half of the respondents holding property (52%), more Malaysians had taken up medical insurance in the past 12 months (47% vs 36%).

The survey also shows over one-third of respondents will rely on medical insurance or the government for critical illness cover, but 26% say they will have to withdraw their bank savings.

“Having witnessed the global economic downturn, Malaysians have become well aware of the threats that may hinder the growth of their wealth, and realised that they may not have enough savings for achieving their long-term financial goals,” said HSBC Amanah Takaful (Malaysia) executive director and CEO Zainudin Ishak.
asked about saving goals, saving for a rainy day is foremost for 79% of Malaysian respondents, while financial security in retirement is the 2nd priority in mind(68%).

Among some of the financial uncertainties in the next year, medical expenses emerged as the biggest threat for Malaysians (50%) and 48% worry they do not have sufficient funds for recurrent daily needs.
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