The Impact of Income Shock on Consumption Spending Among Young Malaysian Household with Credit Usage in Post Covid-19

Abstract

For nearly 6 million young Malaysian in the labour force, Covid-19 will be especially damaging. They face the highest risk of unemployment. Their job opportunities will be severely curtailed by the contraction of the job market and with their comparatively lower incomes, many will struggle to feed their families. This study explores the conceptual framework on the impact of income shock on consumption spending among young household with debts. In this setting, the framework outlined the possible critical factors for suitable policy-formulation during Covid-19 for the government in sustaining the country's economic stability.

Financial Planning Determinants Among Working Adults During Covid 19 Pandemic

“…According to Samad, Ismail, Hussain, Masdek, Zaki, Rahman and Idris (2020), these young adults are affected by the fact that they often spend more than they earn. Adzis, Bakar and Kadir (2017) supported this argument, finding more spending by the younger generation in later periods, as these are primarily due to the inability to manage debt as a result of a hire purchase transaction, mortgages, personal loans, becoming a guarantor, and credit card debt trap.…”