Managed to write this just in time for the Budget. I’m waiting for it to start in 20 minutes or so.
CLSA produced its Mr and Mrs Asia 2009 report, which covers the expenditure and financial trends of the average person (hence the Mr and Mrs in the report). I read the Malaysian segment presentation which was received via an email. The details extracted below are from the Mr and Mrs Malaysia survey updated Summer 2009. Their first survey was in 2007, so there are some comparisons made at times.
So, do you fit in anywhere in here? Are you an average Mr or Mrs Malaysian? Check it out (note that I have categorised the main points/findings):
- Location: 285 respondents in Kuala Lumpur (171 or 60%) and smaller cities like Johor Bahru (29), Ipoh (34), Kuantan (17) and Penang (34).
- Income: Typical household income is RM2,001-5,000 per month (42%) with 84% currently working. 18% have monthly income above RM10,000, 2% earning less than RM1000, 14% earning beween Rm1001 and Rm2000, and 24% earning between RM5,001 and Rm10,000 per month.
- Age: Their sample has a mean age of 33.2, reflecting Malaysia’s young demographic. 78% are less than 40 years old.
- Gender: More than half, 58%, are female.
- Children: 62% have one child and 14% have no children in their household. 15% have two children while 3% have more than 3 children.
- Dependents: 49% had other dependents than children, and 65% said those were parents.
- Household Size: Average household has at least four people. Typically two members of the household are employed.
- Economy Effect on Income: Despite 1Q09 GDP contracting by 6.2% YoY and exports falling 23.5% YTD, 56% said household income has not been affected.
- Economic Effect on Employment: 67% say the downturn has not affected their employment and 67% have not seen family members affected. 23% say the downturn has affected the jobs of other family members, with 59% saying one family member is affected. The downturn has affected household income of 44% of respondents, and 70% have changed their spending patterns. But 10% said the income has increased, 63% said income dropped, and 27% said income unchanged since start of 2008.
- Spending Pattern: Nonetheless, Mr & Mrs Malaysia remain fairly cautious with 70% having changed their spending patterns since the downturn, cutting spending on leisure and entertainment, clothing, food and groceries. Children’s education, mortgages and healthcare took priority. Households have cut spending on leisure/entertainment (1) , clothing (2), food and groceries (3), communications (4), and utilities (5). Changes in income (+/-) affects the leisure/entertainment expenses. Food, mortgage and transport account for bulk of expenses. Children’s education, healthcare, communication, and clothing account for less of the spending.
- House: 31% lives in a 1,500-2,000sf house; 79% own their own homes while 64% have one other property. 52% have a mortgage, and of that, 72% said its for one property only.
- Cars: 94% of respondents own cars. Favorite cars are Toyota and Honda
- Credit Card: 90% have credit cards. 68% have more than once credit card. Favorite credit card provider is Citibank and favorite debit card provider is Maybank. Credit card preferred over debit cards. 63% spend less than RM1000 on their credit cards, while 24% spend between RM1001 and RM2000. 17% said the credit card expenses increased, but 42% said it reduced.
- Savings Pattern: The key buffer is the nation’s high savings rate. Malaysians save the equivalent of 43% of GDP. But Mr & Mrs Malaysia are cautious: 81% place their savings in cash deposits and 72% have not bought stocks in the last 12 months. 45% of respondents save 10-20% of their income, and 47% say savings patterns are unchanged since the downturn. 10% are actually saving more while 43% saving less. 65% do not plan to buy shares in next 12 months. Best investments are cash deposits and properties, while the worst are bonds and stocks. 58% put their wealth in properties, 53% invest in equities while another 31% invest in foreign currencies.
- Employment Outlook: Despite the slowdown, 19% expect job prospects to worsen in the next 12 months, while 40% said it will improve.
- Future Expenditures: This is also reflected in their plans to buy big ticket items in the next 12 months, with 28% planning to buy a house and 13% a car. 40% said they won’t make any big purchases in the next 6-12 months, but 26% plan to buy a house within that period.
- Concerns: Respondents are largely concerned with unemployment and income decline, followed by inability to save and medical costs.
- Expectation on Government: Mr & Mrs Malaysia want the government to prioritise improving the country’s economic conditions. Unfortunately, not many are confident that the Najib administration can handle the downturn well. 66% do not have confidence in the way the government is handling the downturn and many want the government to reduce crime rates. 49% wants the government to improve the economy.