Cost pressures drive more cautious Raya spending

DESPITE steady economic growth and low unemployment, many Malaysian households approached Hari Raya Aidilfitri this year with greater caution, carefully balancing cherished traditions with tighter budgets as living costs continue to weigh on spending decisions.

Economics expert Professor Emeritus Dr Barjoyai Bardai said the cautious approach reflects a combination of lingering cost-of-living pressures, consumer uncertainty and the long-term erosion of purchasing power.

“Even with relatively stable macroeconomic indicators, several factors explain why Malaysian households remain careful with their festive spending,” he said.

He noted that while Malaysia’s economy expanded by about 5.1 per cent and employment remained strong, many families still feel the impact of rising daily expenses, prompting them to cut back on discretionary spending while safeguarding essential Raya traditions.

“Families are tightening spending on dining out, nonessential shopping and other discretionary items, but they still prioritise key festive needs such as clothing for children, traditional foods and balik kampung travel,” he said.

Barjoyai explained that the cumulative impact of inflation also plays a role in shaping consumer behaviour. Malaysia’s long-term average inflation of about 2.5 per cent annually means purchasing power has gradually declined over decades, making households more mindful of spending even during festive periods.

“This long-term squeeze on household budgets contributes to a more cautious spending pattern,” he said.

Families prioritise essentials

Interviews with several Malaysians reveal a similar pattern — celebrations continue, but with greater planning and moderation.

Engineer Syed Mohamad Syathir Syed Ali Zainol Abidin, 41, said his family prioritises essential preparations while avoiding unnecessary purchases.

“For Raya clothes, we usually recycle for parents, but for the children we buy new ones since they are growing and their sizes change,” he said.

He added that his family began preparations earlier this year to avoid last-minute stress.

“We don’t want to do everything at the last minute because it can be very tiring. Last year we felt quite exhausted doing things late,” he said.

Syathir also said his family tries to stick to a planned budget and is not easily influenced by social media trends.

“For Raya, we focus more on necessities rather than extras and only buy what is important,” he added.

Moderation becoming the norm

Junior executive Radhwa Yusairi, 27, said spending during Raya naturally increases because of gatherings and open houses but proper planning helps keep finances under control.

“People do tend to overspend, especially on clothes and food, but it really depends on the situation. For me, I plan what to buy and stick to that,” she said.

Radhwa said government assistance programmes such as MySARA have also helped households manage festive spending by easing the cost of essential items.

“It really helps, especially for buying household essentials. It’s practical because it can be used until December,” she said.

Meanwhile, Muhammad Behtash Arrauf Jaffar, 45, and his wife Siti Samsiah Hussin, 36, said their family adopts a moderate approach to Raya spending.

“For clothes, we buy new ones for the first day only. For the second and third day, we just reuse what we already have,” Behtash said.

He believes spending during the festive season should always be based on one’s financial ability.

“If people can afford it, it’s up to them, but overspending is not good as it can lead to wastage. It’s better to prioritise necessities first,” he said.

Samsiah added that their family also limits the number of 'kuih raya' they buy.

“We only buy what we will actually eat and avoid expensive items unnecessarily. Some kuih we make ourselves and buy the rest,” she said.

Adapting traditions to economic realities

Barjoyai said such spending patterns show that Malaysian families are not abandoning festive traditions but are instead adjusting how they celebrate.

Among the increasingly common practices are hosting smaller open houses, organising potluck gatherings, reusing festive attire and limiting the number of kuih raya varieties prepared.

The adoption of digital duit raya is also gaining traction as banks promote cashless options that allow families to set fixed amounts and manage spending more easily.

“These practices demonstrate that cost-saving measures can coexist with meaningful celebrations,” he said.

Barjoyai also encouraged households to approach Raya spending with structured budgeting.

He suggested creating a dedicated “Raya fund” covering key expenses such as food preparation, travel costs, clothing, duit raya and open house hosting.

“Families who start saving gradually throughout the year can reduce last-minute financial stress,” he said.

Teaching financial literacy through duit Raya

The festive season can also be an opportunity to instil good financial habits among children.

Barjoyai said duit raya can serve both cultural and educational purposes if parents guide children to divide the money into categories such as savings, spending and charitable giving.

Parents can also use festive bonuses wisely by allocating portions to savings, investments or future commitments such as school expenses, insurance or retirement funds.

“Malaysian families continue to prioritise the spirit and meaning of Aidilfitri while adapting their spending to economic realities.

“With thoughtful budgeting and prudent financial planning, households can celebrate meaningfully without compromising their long-term financial security,” he said.