Heaptalk, Jakarta — Research and analysis software company Milieu Insight revealed an alarming trend showing more than 4 in 10 Southeast Asians only save up to 10% of their income. Co-founder and CCO of Milieu Insight Juda Kanaprach stated that this trend exhibits the need for improving financial literacy and planning in this region.
“With 46% of the region’s population investing and most rarely doing so, there is a drive to equip individuals with the knowledge and tools necessary to make informed financial decisions. This report also highlights that Southeast Asian communities are open to the input of financial professionals, demonstrating a willingness to seek guidance and expertise to navigate the complexities of personal finance and investing,” Juda explained.
These findings are the results of a Milieu Insight survey regarding personal finance and investment habits in Southeast Asia involving 3,000 respondents covering Singapore, Malaysia, Indonesia, Vietnam, Thailand, and the Philippines. The research was conducted in January-February 2024 with respondents representing online adults aged 16 years and over.
Indonesia has the lowest credit card ownership rate
According to the survey results, achieving financial security and ensuring adequate retirement savings ranked second after good health, indicating the importance of a successful life for Southeast Asians. This sentiment was shared by 52% of respondents, underscoring the importance of financial well-being.
Although around half of Southeast Asia’s population owns and uses a credit card, there are significant disparities between countries, with Indonesia having the lowest ownership rate and Singapore having the highest ownership rate. However, 68% of credit card holders in Southeast Asia almost always pay their bills in full, indicating responsible financial management among the majority of users.
On the other hand, more than half (54%) of respondents do not actively invest, thereby potentially missing out on wealth accumulation and financial growth opportunities. This trend may be influenced by multiple factors such as low financial literacy, limited access to investment opportunities, and a preference for saving over investing.
Singapore is leading in active investment
In the area of investment, the survey also demonstrates that almost half (46%) of Southeast Asians actively invest their money, with 58% allocating up to 20% of their income to investments. However, 1 in 5 people adopt an ad-hoc approach to investing, indicating potential space for improvement in financial planning strategies.
Among all countries surveyed, Singaporeans are the leader in active investment, with 59% indicating they invest their money compared to 46% across the region. Stocks, fixed deposits, and mutual funds are the top three areas of investment among Southeast Asians, driven primarily by retirement security, wealth growth, and regular income.
This report also found that Southeast Asians showed openness to professional financial advice, and 60% said it increased their self-confidence. Among those who invest, 49% rely on an advisor as their primary source of guidance, highlighting the importance of expert insight in the financial decision-making process.
