Malaysia: Government urged to act to encourage savings
Source: Asia Insurance Review | Sep 2018
Malaysia Life & Health Pensions & Annuities
An economist has urged the government to enact policy measures to encourage Malaysians to save following the disclosure that the bulk of some 22m employees have no formal social protection. Sunway University Business School Yeah Kim Leng told Free Malaysia Today that it was alarming that so many Malaysians were in this situation.
He voiced concern that without any action on the part of the government, those who retired with insufficient savings could find themselves in financial trouble.
He also suggested that courses on financial literacy be taught at universities or in training courses designed by human resources departments to help create a more financially educated and independent society.
At the same time, Employees Provident Fund (EPF) chairman Samsudin Osman revealed that 62% of some 22m working-age Malaysians are self-employed and not covered by any formal social protection.
He also said recent statistics indicated that more than 70% of Malaysians do not have a rainy day fund for emergency expenses.
Economist Barjoyai Bardai meanwhile offered a different solution which he said would require only minimal investment from the government.
“I believe (investing in) insurance is much better than EPF as EPF is just savings that can only be withdrawn during difficult times. A