Are You Approaching Your Financial Finish Line

By Dr. May Ng, Associate Head of Management at Edinburgh Business School, School of Social Sciences, Heriot-Watt University Malaysia

Some experts define the ‘financial finish line’ as the point at which you’ve achieved all your major financial goals—paying off your mortgage, funding your children’s education, and securing your retirement savings.

So, have you reached your financial finish line? Here’s something to consider.

According to the Department of Statistics Malaysia’s (DOSM) Abridged Life Tables Malaysia (2024), Malaysian women, on average, live longer than men—21.4 additional years compared to 18.6 years for men. This longer lifespan means women must stretch their retirement savings further, making financial planning even more crucial. Women are also more likely to experience career interruptions due to childbirth, caregiving responsibilities, or relocating with their spouses.

According to a study by Khazanah Research Institute in 2024, over 3.1 million women, constituting 62.9% of those outside labour force, cite family responsibilities as their primary reason for not seeking employment.

For those who are employed, the gender pay gap remains a challenge. In a separate study, DOSM revealed that in 2023, the median wage for men was RM2,675, compared to RM2,464 for women.

Naturally, this disparity impacts long-term earnings and retirement savings. Among Employees Provident Fund (EPF) members aged 54 in 2023, the median savings for men stood at RM176,676, while for women, it was RM122,890—44% lower. Additionally, with a longer lifespan, women may need to allocate more funds for healthcare expenses.

As life evolves, so do financial goals and needs. A well-structured financial plan (Plan A) is essential for long-term security. Here’s how you can build a solid Plan A:

Adopt a Disciplined Savings Approach

Develop a disciplined savings habit by setting clear targets. Aim to save at least 10-15% of your monthly income, gradually increasing this percentage as your salary grows. Prioritise paying off high-interest debts quickly to free up more money for savings and investments.

Building an emergency fund of at least 12 months’ worth of living expenses is equally crucial. This ensures financial security in the face of unexpected situations such as medical emergencies or job loss.

Additionally, the earlier you start saving, the more you can benefit from compound interest. Consider investing in high-yield savings accounts, fixed deposits, or diversified portfolios to maximise returns. Women can also take advantage of EPF matching savings schemes such as i-Suri, i-Saraan, and for married individuals, i-Sayang.

Automating your savings through online banking features can help maintain consistency and discipline.

Develop a Strong Financial Mindset

Financial literacy is key to wealth-building. Attend financial workshops, take online courses, or listen to finance-related podcasts to gain insights into investing, budgeting, and long-term financial planning. Engage in discussions with friends, family, or networking groups to exchange knowledge and stay motivated.

Conduct Regular Financial Assessments

Frequently review your spending habits to ensure you are living within your means and saving adequately. Start today—take just 15 minutes to assess your finances, set a small savings goal, and explore ways to diversify your investment portfolio.

Ensure Adequate Insurance Coverage

With longer lifespans, women must prioritise comprehensive medical and life insurance plans. A well-structured policy can ease financial burdens and provide greater peace of mind.

Financial security is not a one-time achievement but an ongoing journey. With a solid Plan
A, you can navigate career breaks, income disparities, and long-term financial needs—crossing the finish line with confidence and peace of mind.

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