Household Financial Discipline As Important As National Economic Resilience, Says Academician

By Abdul Hamid A Rahman

KUALA LUMPUR, March 10 (Bernama) -- Household financial discipline is just as critical as national economic resilience, particularly amid global uncertainties that could affect prices, incomes and overall financial stability.

Universiti Teknologi MARA (UiTM) Faculty of Business and Management senior lecturer Dr Chong Siew Huay said households must remain financially disciplined as geopolitical tensions and economic volatility could indirectly affect Malaysia through fluctuations in commodity prices and rising living costs.

“In times of economic uncertainty, practising prudent spending and building savings are important strategies for households.

“Savings can serve as a financial buffer to help families cope with unexpected shocks such as higher prices or income disruptions,” she told Bernama.

Recently, Prime Minister Datuk Seri Anwar Ibrahim reminded Malaysians to practise prudent spending, increase their savings and avoid wasteful expenditure amid global economic uncertainties. 

Anwar said geopolitical tensions, particularly conflicts in the Middle East, could disrupt global supply chains and push prices higher, potentially affecting the cost of living. 

The UiTM lecturer said strengthening household savings would help ensure families remain financially resilient during periods of economic uncertainty.

“With Hari Raya Aidilfitri approaching, an increase in household spending is natural as families prepare for the celebrations, but consumers should remain mindful of their financial capacity.

“Festive spending is acceptable as long as it is done responsibly and within one’s means. Households should prioritise essential purchases, plan their spending in advance and avoid excessive borrowing or unnecessary purchases,” she said.

She added that purchasing essential items earlier to avoid potential price increases closer to the festive period could be considered rational consumer behaviour, provided it is done in moderation.

“Buying early may help consumers secure better prices and manage their household budgets more effectively.

“However, overbuying due to panic or speculation should be avoided, especially for perishable items such as food,” she said.

Chong also advised Malaysians to maintain a reasonable level of savings, manage debt carefully and practise responsible financial planning amid global uncertainties, including conflicts in the Middle East.

“Geopolitical instability often leads to volatility in commodity markets, which can translate into higher prices for everyday goods.

“Having adequate savings and practising careful financial planning can help households remain resilient during such periods,” she said.

Meanwhile, a civil servant welcomed the prime minister’s advice, saying prudent spending and savings have become increasingly important amid the rising cost of living.

Danni Haizal Danial Donald, 25, who has been serving in the federal public sector for the past three years, said Anwar’s reminder resonated with him as managing finances carefully is essential, especially for those at the beginning of their careers.

“With Hari Raya approaching, I usually allocate about RM1,000 for festive items such as Hari Raya clothes and ‘kuih raya’ for my family.

“I set a budget and try to stick to it, although other family members also contribute to the preparations,” he said.

He added that people in the early stages of their careers need to plan their finances carefully to cope with current cost-of-living pressures.

-- BERNAMA