It has not been easy for everybody when the Covid-19 pandemic hits the country. Despite the country currently transitioning into endemicity, the impact of the pandemic is already permanent on us.
Recently, the Malaysian Department of Insolvency (MDI) has revealed that there are a total of 287,411 individuals in the country have been declared bankrupt as of March this year.
According to Kosmo, most of them were forced to declare bankrupt for failing to clear loan debts due to insufficient funds. Unfortunately, most of them are young individuals who are still working.
Speaking to Kosmo, an officer from MDI, Zarina Alias revealed that Selangor recorded the highest number of bankruptcy, followed by Kuala Lumpur with a number of 71,659 and 45,630 reported respectively.
Their statistics showed that workers from the private sector and businessmen are the group of people with the most bankruptcy reported. They are aged between 35 and 44 years old.
At the same time, those aged 44 and below are also not “pardoned” from bankruptcy. She added that 22.13% of them were declared bankrupt and are at high risk for bankruptcy if they don’t have good prior financial planning.
Meanwhile, Zarina shared that personal loans, car loans, and business loans are among the major contributing factor to bankruptcy. Most attempted to get the cash immediately by getting personal loans for multiple reasons.
“The problems became worse when they failed to handle the money and eventually, they were stuck in high monthly commitment.” she said.
Zarina then shared some tips on how to avoid bankruptcy. Here’s what you should do.
- Spend only on your needs, not wants.
- Handle your debts wisely
- Be careful with any kind of loan
She also pointed out that we should be aware of our financial status from time to time to avoid failing to repay our debts.
What do you think about this? Share your thoughts!