Happy New Year 2026! With the emergence of gig job opportunities, finding extra money is no longer a problem for Malaysians. We are well-known for our ability to take advantage of opportunities to generate income, including as sales agents, affiliates of buying and selling platforms or selling food on a small scale from home.
However, the real financial challenge in this new year is no longer about finding money, but rather how to manage money in an environment where the cost of living continues to rise. If unhealthy financial habits from 2025 are carried over into 2026, financial stress will continue to recur without resolution.
Here we list five personal finance mistakes you should avoid in 2025, if you want to build a more stable financial position throughout 2026.
1. Not Knowing Where Your Money Goes
The most basic mistake in personal finance but the most often taken lightly is not understanding where your money is being spent. Without a budget or spending record, small costs like digital subscriptions, eating out, and impulse purchases often become silent leaks that go unnoticed.
In 2026, financial management needs to start with awareness. Every expense should be made consciously and in control. Tracking basic expenses is enough to identify habits that need to be corrected.
2. Using Debt for Lifestyle
The use of credit cards, gadget installments, and “buy now pay later” schemes to support lifestyles is still a major trap. The problem is not with the debt itself, but with the purpose of the debt.
Debt for assets or to increase productivity can be considered. However, debt to meet short-term needs will only add to long-term financial stress. Debt can be used, but must be used in moderation.
As a reminder, avoid using BNPL facilities solely to upgrade your smartphone.
3. Still No Emergency Fund
Many still consider an emergency fund as an option, not a necessity. The fact is, without emergency savings, you will be stuck when faced with unexpected situations.
In an uncertain economic environment, an emergency fund is no longer a backup plan, but the first line of defense for personal finances.
Save before you spend, set aside 10-20% of your income as your emergency fund each month.
4. Ignoring the Effects of Inflation
Saving money without an investment strategy or return that beats inflation means that the value of your savings will decrease every year. This mistake often occurs when individuals are too comfortable saving cash alone.
In 2026, diversify your savings methods according to your risk tolerance level. To start, buying 1 gram of gold is enough. In 2025 alone, gold recorded returns of more than 70% for those who save it.
5. Overly Believing in Promises of Quick Returns
Promises of high returns, “sure-to-profit” schemes, and trend-following investments are still the cause of big losses. Financial decisions made based on emotions, FOMO, or testimonials without understanding only increase the risk.
Be careful with any “investment” that promises high returns in a short period of time. There is no shortcut to getting rich. Wealth is built through discipline, patience, and consistent fundamental understanding.
Invest in financial literacy first, so you can distinguish between real investment opportunities and scams.
In an increasingly challenging economy, well-managed personal finances are a form of long-term security and peace of mind.
By abandoning old, leaky habits and shifting to more systematic money management, you can reduce financial stress.
