Why Most Malaysians Stay "Average" with Their Money (And How You Can Break Free)

 

Introduction: Escaping the Average Money Trap

Walk into any mamak at night, and you’ll hear the same stories:

• “Gaji tak cukup…”

• “Kereta baru beli, installment mahal...”

• “Takde saving, susah nak kahwin…”

The truth?
Most Malaysians stay financially average not because of fate — but because of habits.

Today, we’ll break down why many people stay stuck, and more importantly, how you can break free and build real wealth.

The “Cashflow = Survival” Mentality

In Malaysia, many live paycheck to paycheck:

• Salary comes in.

• Expenses eat up 90%–100%.

• Maybe RM50–100 left by month-end.

This cycle feels normal because everyone else is doing it.
But normal ≠ good.

Reality Check:
If you save nothing today, you're borrowing from your future self.

Key Reasons Most Stay Average

✅ 1. No Budgeting Habit

"Tak cukup duit" is often because there’s no plan, not because income is too low.

✅ 2. Lifestyle Inflation

Every time income goes up, spending goes up faster. New car, new iPhone, bigger house.

✅ 3. Zero Investing

Savings die slowly under 2–3% bank interest, while inflation eats away purchasing power.

✅ 4. Fear of Taking (Smart) Risks

Many avoid investing, side hustles, or entrepreneurship due to fear.

✅ 5. Following the Crowd

Investing because "kawan suruh" or spending because "semua orang buat" leads to disaster.

How You Can Break Free

1. Build Emergency Fund First

• 6 months of expenses minimum.

• Tabung Haji, Maybank MAE, Touch n' Go Go+ for short-term.

2. Invest Systematically

• Start with unit trusts, robo-advisors like StashAway, REITs, EPF voluntary top-ups.

3. Increase Financial Literacy

• Read one finance book a month (start with The Psychology of Money).

• Follow reputable Malaysian finance blogs.

4. Mind Your Circle

• Spend time with people who talk about investments, businesses, growth — not just gossip.

5. Set Financial Goals

• RM100k savings by 30?

• Passive RM2,000 income monthly by 40?

Write it down, break it into steps, and track monthly progress.

Malaysian Real-Life Example

Average Joe

• RM5,000 salary

• RM4,800 expenses

• RM200 "savings"

• Net worth growth: almost none

Smart Sam

• RM5,000 salary

• RM2,500 expenses

• RM2,000 savings/investments monthly

• Net worth at RM100,000+ by 30 years old

Small differences in daily habits = Big differences in life outcomes.

Conclusion: Dare to Be Different

It’s easy to stay average — blame the government, inflation, bad bosses.

It’s harder but far more rewarding to be different — to take ownership, save aggressively, invest wisely, and focus on your own growth.

Because in 10 years, you'll either be someone complaining at the mamak table — or someone financially free ordering the roti tisu without checking the price.

Which one will you choose?

Penny Wise, Pound Foolish — A Tale of Missed Opportunities in Personal and Business Finance

 

Introduction: The Hidden Cost of Frugality

Everyone loves a good deal.
Cutting down costs, finding discounts, being "budget-conscious" — these are signs of financial responsibility, right?

But there's a dark side when saving becomes an obsession.
That’s when you're being penny wise but pound foolish — saving small amounts now but losing big opportunities later.

And this mindset affects both:

• Everyday individuals trying to manage their money

• Business owners trying to grow their companies

Let’s explore both sides of this coin — and learn how to avoid stepping over dollars to pick up cents.

🧍‍♂️ Part 1: The Personal Finance Side — Saving Too Small, Losing Too Big

1. Skipping Insurance to "Save a Bit"

A young working adult avoids getting life or medical insurance.

“RM600 a year? Aiyah, waste money lah…”

Then one day, an unexpected illness strikes.
Now he faces RM50,000 in medical bills — with no coverage.

✅ Lesson:
Insurance is like an umbrella — you don’t need it every day, but when it rains, you’ll be glad you had it.

2. Choosing the Cheapest Internet Plan

Saving RM30 a month on a slow broadband plan might feel good — until:

• Zoom meetings drop

• Netflix buffers

• Work files take forever to upload

Over a year, you waste hours of time.

✅ Lesson:
When a tool affects your productivity and peace of mind, don’t pinch pennies.

3. Not Investing in Learning

“RM300 for a financial course? Better I watch YouTube free ones.”

But after years of free content and no progress, you’re still stuck paycheck to paycheck.

✅ Lesson:
A single RM300 course or RM80 book can return thousands in lifetime value — if you take action on it.

4. Delaying Car Maintenance

Skipping a RM250 car service turns into a RM3,000 repair bill when the transmission breaks down.

✅ Lesson:
Maintenance is always cheaper than repair.

5. Refusing to Pay for Budgeting Tools

“I can write down expenses myself!”

Yes — but you don’t.
And without a budgeting app or habit, your spending continues aimlessly.

✅ Lesson:
If a tool helps you stay disciplined and consistent, it’s not a cost — it’s an investment.

🏢 Part 2: The Business Owner Trap — When Frugality Costs Millions

Business owners pride themselves on being lean.
But being cheap at the wrong time can silently sabotage long-term growth.

Let’s walk through a very real-world example:

🚨 Case Study: The RM10,000 Software vs RM5,000,000 Project

A Malaysian automation company spots a high-value project opportunity — a RM5 million contract requiring complex system simulation.

The bidding criteria specify the use of industry-grade simulation software.

The solution?
A one-year software license costs RM10,000 — just 0.2% of the project value.

But here’s what happens:

Instead of green-lighting the purchase, the owner delays:

“Let’s use free software.”
“Get ChatGPT to help us write Python simulation code.”
“RM10k too much lah. What’s the ROI if we don’t win the bid?”

The True Cost of “Savings”

While the team scrambles with open-source workarounds, time ticks away.
Errors pile up. The final report is substandard. The bid is late.

✅ Result:
They lose the RM5 million project — and the doors it could’ve opened.

All to “save” RM10,000.

💣 The "What's the ROI?" Trap

Here’s the irony:

Asking about ROI is supposed to be strategic.
But many owners use it not to understand, but to avoid.

They challenge the ROI:

• Not to weigh benefits…

• But to poke holes and justify saying "no"

✅ Hard truth:
If your go-to reaction to every spending proposal is "justify ROI" — but deep down you've already decided not to spend — you're just looking for a way out.

Flip the Question:

Instead of asking:

“Can we afford this tool?”

Ask:

“Can we afford not to?”

Because when fear of cost always wins over value — your business gets stuck.

Hidden Long-Term Benefits Ignored

The license wasn’t just for that one bid.
With a 1-year license:

• You can prepare for future tenders.

• Train engineers faster.

• Produce client-grade simulations.

• Strengthen R&D credibility.

RM10k for 12 months of capacity building — but short-term thinking killed the long-term value.

💼 Other Business Owner Missteps

1. Hiring Cheap Instead of Capable

That RM1,500 freelancer who delivers late and low quality?
Ends up costing more than the RM4,000 professional who gets it right the first time.

2. Skipping Proper Accounting or Legal Help

“Why pay RM5,000 for professional advice?”
Because it saves you RM50,000 in tax fines or failed audits.

3. Not Investing in Automation or CRM Tools

“No need lah… can do manual.”

Until your team drops leads, invoices go missing, and clients stop calling.

4. Doing Everything Yourself

Business owners who never hire or delegate stay in "self-employment" mode — stuck on daily tasks with no bandwidth to grow.

✅ Lesson:
Time is your most valuable currency. Stop spending RM200/hour time on RM20 tasks.

🧠 Mindset Shift: Value-Driven Thinking

💬 Ask Smarter Questions:

❌ Not: “Is this expense justified right now?”
✅ Instead: “Will this investment make us better, faster, or more credible in the next 6–12 months?”

🛠 Budget for Strategy, Not Just Survival

Set aside funds every year for:

• Tools that scale

• Software that saves time

• Training that upskills staff

• Systems that improve client trust

These aren’t luxuries — they’re strategic weapons.

🧭 Real Growth Comes from Leverage

You don’t need to spend freely.
But you must be willing to spend smartly.

• Spend RM10 to earn RM100 — always.

• Invest RM10,000 to unlock RM5 million? No-brainer.

If every “investment” is seen as “cost,” your business stays small, reactive, and replaceable.

Final Thoughts: Be Frugal with Wants, Bold with Growth

There’s nothing wrong with being cautious.
But when saving RM100 today causes you to lose RM10,000 next year — that’s not wisdom. That’s fear in disguise.

Whether you're managing your personal budget or leading a company, remember:

Being cheap is easy. Being smart is better.