Financial Literacy survey

Malaysia

2019

Index: Questions adapted from prior studies/national

surveys
Section 1 – Survey and socio-economic Shim et al. (2009)
information

Section 2- Financial Information Grohman, Kouwenberg and Menkhoff (2015)

Section 3- Financial Literacy (Basic and Van Rooji et al. (2011)

Advanced questions)

Section 4- Financial Behaviour OECD (2005)

Section 5- Socialization factors Grohman, Kouwenberg and Menkhoff (2015)

Shim et al. (2009)
Van Rooji et al. (2011)
Section 6- Financial well-being CFPB (2015)
(Consumer Financial Protection Bureau)
 Section 1

Age:

Gender: Male / Female

State:

Ethnic background: Malay / Chinese / Indian / Kadazan / Other

Marital status: Single / Married / Divorced

Highest education level: PhD / Masters / Degree / Pre-university / High school / Primary / None

Parent’s or guardian’s highest level of education:

Occupation:

Section 2

1. Financially independent: Yes /No

2. Do you have a savings account? Yes / No
3. At what age did you open a bank account?
4. Do you have a fixed deposit account? Yes / No
5. Are you currently holding any stocks? Yes / No
6. Do you have any experience in investments? Yes / No
7. Have you taken up any loans?
8. How many people are currently financially dependent on you?
 Section 3

Basic Financial Literacy

Numeracy
(1)
Suppose you had RM100 in a savings account and the interest rate was 2% per year. After 5 years, how
much do you think you would have in the account if you left the money to grow?

(i) More than RM102; (ii)Exactly RM102; (iii) Less than RM102; (iv)Do not know;(v)Refusal.

Interest Compounding
(2) Suppose you had RM100 in a savings account and the interest rate is 20% per year and you never withdraw
money or interest payments. After 5 years, how much would you have on this account in total?

(i)More than RM200; (ii) Exactly RM200; (iii)Less than RM200; (iv)Do not know; (v)Refusal.

Inflation

(3) Imagine that the interest rate on your savings account was 1% per year and inflation was 2% per year. After
1 year, how much would you be able to buy with the money in this account?

(i) More than today;(ii)Exactly the same; (iii)Less than today;(iv)Do not know;(v) Refusal

Time value of Money

(4) Assume a friend inherits RM10,000 today and his sibling inherits RM10,000, 3 years from now . Who is
richer because of the inheritance?

(i) My friend;(ii) His sibling;(iii)They are equally rich;(iv)Do not know;(v)Refusal.

Money Illusion

(5) Suppose that in the year 2010, your income has doubled and prices of all goods have doubled too. In 2010,
how much will you be able to buy with your income?

(i) More than today; (ii)The same;(iii)Less than today;(iv)Do not know;(v)Refusal.

Advanced Financial Literacy

(6) Which of the following statements describes the main function of the stock market?

(i) The stock market helps to predict stock earnings

(ii)The stock market results in an increase in the price of stocks

(iii)The stock market brings people who want to buy stocks together with those who want to sell stocks
(iv)None of the above
(v)Do not know
(vi)Refusal

(7) Which of the following statements are correct? If somebody buys the stock of firm B in the stock market:

(i) He owns a part of firm B;

(ii)He has lent money to firm B;
(iii)He is liable for firm B’s debts;
(iv)None of the above;
(v)Do not know;
(vi)Refusal
(8) Which of the following statements is/are correct?

(i) Once one invests in a mutual fund, one cannot withdraw the money in the first year
(ii)Mutual funds can invest in several assets, for example invest in both stocks and bonds
(iii)Mutual funds pay a guaranteed rate of return which depends on their past performance
(iv)None of the above
(v)Do not know
(vi)Refusal

(9) Which of the following statements is correct? If somebody buys a bond of firm B:

(i)He owns a part of firm B

(ii)He has lent money to firm B;
(iii) He is liable for firm B’s debts
;(iv)None of the above
(v)Do not know
(vi)Refusal.

(10) Considering a long time period (for example 10 to 20 years), which asset normally gives the highest return?

(i)Savings accounts
(ii)Bonds
(iii) Stocks
(iv)Do not know
(vi)Refusal.

(11) Normally, which asset displays the highest fluctuations over time?

(i)Savings accounts
(ii) Bonds
(iii)Stocks
(iv)Do not know
(v)Refusal

(12) When an investor spreads his money among different assets, does the risk of losing money:

(i) Increase (ii) Decrease (iii) Stay the same (iv)Do not know (v)Refusal.

(13) If you buy a 10-year bond, it means you cannot sell it after 5 years without incurring a major penalty. True
or false?

(i)True (ii)False (iii)Do not know (iv)Refusal.

(14) Stocks are normally riskier than bonds. True or false?

(i)True (ii)False (iii)Do not know (iv) Refusal.

(15) Buying a company stock usually provides a safer return than a stock mutual fund. True or false?

(i) True (ii)False (iii)Do not know (iv)Refusal.

(16) If the interest rate falls, what should happen to bond prices?

(i)Rise (ii)Fall (iii)Stay the same (iv) None of the above (v) Do not know (vi) Refusal.
 Section 4

1) Do you have a credit card? (own/parent’s subsidiary card)

2) Have you ever (personally) saved money, apart from saving at the bank for emergency
purposes?
3) Do you set a budget when planning to purchase or spend?
4) Do you pay your own bills/ loans? (eg. Phone, rent)
5) Do you feel that you would have been able/ are able to make better use of your finances
with the necessary education in finance?
Yes / No / Maybe / Do not know
6) Have you ever had a situation where you ran out of funds because of unplanned spending?
7) How much of your income or allowance do you save each month? (eg. 20%)

Rate these questions/statements on a Likert scale on 1 to 5, [1 – never/very poor, 3- somewhat

considered/average and 5- always/excellent]. *select N/A if not applicable

8) I pay my bills and credit card balance in full each month.

9) I always stay within my budget each month.
10) I am very responsible when it comes to spending money.
11) I find it more satisfying to save money for the long term than to spend it.
12) I am not prepared to risk some of my own money when making an investment.
13) I keep close watch on my financial affairs.
14) I always consider (products/loans/policies/accounts) from different companies before
making a decision.
15) I feel very knowledgeable in making important financial decisions (investments, stocks,
derivatives)?
16) I am planning to invest or make use of other forms of financial products to grow my savings.
 Section 5

Rate these questions/statements on a Likert scale on 1 to 5, [1 – never/very poor, 3- somewhat

considered/average and 5- always/excellent]. *select N/A if not applicable

Parents/Guardian

1. I follow my parent’s/guardian’s advice to spend within my budget each month.

2. My parents/guardian usually include me in or spoke to me about financial discussions while
growing up.
3. My parents/guardian taught and encouraged me to save throughout my childhood.
4. My parents/guardian have a very good understanding on financial matters.
5. I remember and apply financial knowledge I obtained through parents discussion during
childhood in my current financial decisions.
6. I still go to my parents/guardian for advice on financial matters.

Formal education

1. I took up Accounting or Economics during high school (SPM or GCSE).

2. I studied or currently am doing a degree related to Finance/ Accounting/ Economics/
Business/ Management.
3. I have taken up or undergone some form of financial education (taxes, savings, investment,
etc) up to this date.
4. The courses/subjects that I have taken has helped me shaped my knowledge in financial
affairs and has taught me to make important decisions (what to expect/avoid).
5. I wished there was some type of course for me to attend and improve my financial decision
making.
6. There should be more personal and general finance related courses offered to all young
adults.

Peers

1. I ask my friends for advice when making decisions.

2. I have friends who are in a finance related career or studying a degree in Finance, whom I go
to for advice.
3. I trust my friends’ advice more than my parents’ advice or formal education obtained.
4. My friends influence my spending habits.

Work and early experiences with money

1. I had allowance as a child.

2. I had a bank account before 18.
3. I had a job (part-time also included) before age 18.
4. Early experiences have helped me understand the importance of savings, budgeting and
responsibilities.
5. I am currently working full time.
6. I have family members or others who are financially dependent on me.
7. I feel more responsible of having better finances to ensure I can carry out future plans and
able to take care of loved ones, after getting a job.
Overall

1) I consult my parents before making any financial decisions.

2) I consult my peers or work colleagues before making any financial decisions.
3) I use the knowledge I have learnt from prior studies or experience to make financial
decisions.
4) I rely on information on the media (internet, news, social media, etc) for news before
making any financial decisions.
5) I can recall some of my early childhood experiences with money (budgeting, saving or
earning)
6) My recent financial experience (i.e. investing) has helped me be more cautious when
handling my finances.

Opinion

Extra question: Islamic and Asian Civilisation Studies (TITAS) and Ethnic relations studies are
compulsory courses to be taken by all local students in Malaysian universities. Considering
that we have studied similar syllabus (in History, Moral studies and Islamic studies)
throughout high school for 5 years and took a compulsory government exam (SPM) which
requires a minimum of pass in all the mentioned subjects to get accepted at a university,
what do you think about having a course teaching personal and general finances (tax,
investments, stocks, EPF, SST) instead?

Section 6

Likert scale (1= never/none, 5= always/significant amount)

1. I could handle a major unexpected expense.

2. My financial future feels secured because I know that the money I have and will save will
last.
3. I can enjoy life because of the way I’m managing my money.
4. I am satisfied with the amount of knowledge I currently have on financial matters and
confident that I will have no financial problems in the future.
5. I am satisfied with the financial status I am currently in.
6. I do not have a significant amount of debt left unpaid (loan, credit card, borrowings from
friends and family).