Thailand and Financial Management - Are We Ready?

Article by: Nipapan Poonsatiansap CFP® Independent Financial Planner


Warren Buffett is the ultimate value investor and the world’s renowned conservatism. His wealth ranked among the top richest people in the world. A quote by Mr. Buffett on saving was:

 “Do not save what is left after spending, but spend what is left after saving.” which, simply means “Do not spend before savings but save before spending”. This Inspiring quote could be everybody’s philosophy, especially during global economic struggles. “Savings” is one of the best wealth building principle and mechanism for financial security and emergency savings.

Let us Look at Thai’s Savings Habit and Financial Management

The survey of Bank of Thailand indicated a high portion of savings or 77.4% from total Thai population which, breakdown to 47.4% of short-term savings and 52.6% of long-term savings, respectively.   There were other   type of savings such as post-retirement spending savings, home purchase savings and children education fund savings. But it seems, not many Thais are planning on retirement savings.

Despite the study result of higher savings habit, the problem (let me stress again) lies in the small portion or only 25% succeeded in retirement savings according to plan. Whereas, 34.3% of the population did not meet their post retirement savings target.

21% of the population thought about savings but never actually start and 19.7% have not yet plan for their retirement savings. 

Therefore, 25 out of 100 people could retire as plan whereas, 75 other people could not afford to retire. This issue is quite disturbing.

Health issue is one among the top concerns of Thai people (major loss of savings). The study indicated concern over health issue by 57% and 42% over risk of travel accident, respectively.  74% of the sample population disregard the important of health insurance or uninterested and only 24% had health insurance.

The majority of post-retirement spending came from healthcare. Many of white collars have group insurance coverage as part of company benefit and they perceive health insurance as an obligation and they would wait out until near retirement. Truth be told, health insurance can’t be bought by money alone, you have to buy it with good health. We can never be certain of our fitness at near retirement age. Your insurance application will not be granted after your health deteriorated with underlying disease. Subsequently, another portion of savings for healthcare coverage is needed.