THE RISING COST of living always impacts financial resilience—one’s
capability to save and how long the savings last, accounting for accrued debt and living expenses. Such resilience is not simply a function of how much a household earns, but also of how well income, expenditure and expectations are balanced over time. While macro-level data may show stable and robust growth, households’ financial resilience may weaken. Shoring up resilience is crucial; a household that can meet current bills but cannot strengthen a buffer for tomorrow is, by definition, financially fragile: they may be one medical bill or one job loss away from real distress.
BETWEEN THE MACRO AND THE MICRO
In the absence of shocks, Malaysia’s aver-age real gross domestic product (GDP) grew by more than 4%, with gross national income (GNI) per capita at RM57,200 in 2025. At the macro level, Bank Negara Malaysia’s (BNM) latest Financial Stability Review – Second Half 2025 indicates that household finances remain robust and resilient. Malaysia’s median debt service ratio has remained steady at 33%, reflect-ing stable debt repayment obligations rel-ative to income. Additionally, the median debt-to-income ratio, which measures borrower leverage and potential financial vulnerability, has remained broadly stable at 1.3. This suggests that households are maintaining consistent debt levels relative to their income.
What surprises us is that BNM’s Financial Literacy and Capability Index reached 59.1 out of 100 in 2024, a slight increase from 59.0 in 2021. This incremental improvement suggests that efforts to boost financial literacy are gradually having an impact, which could lead to better financially informed decision-making among the population and, over time, improved financial stability and economic resilience. After all, those with stronger financial capability often seek out relevant financial information to improve their knowledge and plan ahead.
