KUALA LUMPUR: The concepts of FOMO (fear of missing out) and YOLO (you only live once) which are popular among youths, are leading them to accumulate debt as early as 20 years old.
The pressure to keep up with the latest trends, particularly in gadgets, fashion, and lifestyle, causes many young people to take out loans beyond their means, resulting in significant debt.
Prof Dr Mohamad Fazli Sabri, a consumer financial expert and the dean of the Faculty of Human Ecology at Universiti Putra Malaysia, expressed concern over this trend, noting that young people are falling into unnecessary debt at an alarming rate.
"Youths borrowing to buy necessities is a serious issue as it indicates a failure to manage their finances. We should not borrow for survival," he said.
He illustrated the problem with examples of individuals being forced to take out loans to cover essentials such as rent, car payments, or even groceries.
"This should not happen and is very worrying," he added.
His comments were in response to a statement by Finance Minister II Datuk Seri Amir Hamzah Azizan, who said the Credit Counselling and Debt Management Agency reported that 53,000 individuals under 30 are burdened by nearly RM1.9 billion in cumulative debt.
Mohamad Fazli emphasised that those struggling with debt should reassess their financial decisions, distinguishing between necessities and wants.
"Many individuals are willing to borrow to buy new mobile phones or take out personal loans. They are influenced by FOMO and YOLO, following trends without considering their financial realities.
"They often associate with wealthier peers and feel pressured to keep up. As a result, they end up in debt.
"Today, obtaining a loan is easier than ever; you don't need to visit a bank or rely solely on traditional financial institutions. Some students fall into debt through services like 'buy now, pay later' schemes," he said.
Mohamad Fazli reminded consumers to reevaluate their spending habits and carefully consider whether they can afford to repay any loans before committing to them.