Hello again.
This post is a departure from my usual fare. At the request of some friends, I write this for the benefit of my fellow Malaysians. Specifically for those in secondary school school, university, or in their early to mid twenties. If you’re reading this, you deserve to know what you’re worth. You probably should be earning more. All too often I hear Malaysians whining about how little they make, but there is no forward momentum. No plan. Maybe you don’t even know where you are. I’m not one for empty platitudes so instead of going the fake coach/gooroo route I am going to show you what is possible.
I have edited for clarity and a smoother reading experience where necessary. It is mostly unedited and untouched to better preserve the off-the-cuff vibe I generally prefer when writing.
One of the best things about my line of work is that I meet people from junior associate or operator level to senior management, site heads, C-suite, etc.I meet a lot of hiring managers – people who know what everyone else makes, and thus what they ought to be paid1.
Like many Malaysians in their twenties, I used to think that cracking 6 figures a year was an impressive achievement but given what I know now, 6 figures per annum – your 100K yearly salary – is actually the starting point.
It’s crazy how many people walking around have a 6 figure salary without doing anything remarkable.
And once you get on this level you begin to be very conscious that there are levels… and then there are LEVELS.
I
Break it down.
Salaries in Malaysia range from 1,670 MYR per month (starting salary) to 29,400 MYR per month (maximum average salary, actual maximum is higher). This is not the minimum wage as per the law, only the lowest reported number in the salary survey that had thousands of participants and professionals from all over the country. - Salary Explorer
Malaysia Gross Domestic Product (GDP) per Capita reached 12,449.664 USD in Dec 2022, compared with 11,452.936 USD in Dec 2021. That’s approximately 55 grand in ringgits (MYR).
Average salary in this country is around 5-7K a month, so let’s go with Salary Explorer’s estimate of MYR5,790 (not adjusted for age).
The median salary is 5,790 MYR per month, which means that half (50%) of the population are earning less than 5,790 MYR while the other half are earning more than 5,790 MYR. The median represents the middle salary value. Generally speaking, you would want to be on the right side of the graph with the group earning more than the median salary. - Salary Explorer
By definition, if you earn more than this you are statistically above average.
To earn a 6 figure salary you have to earn RM8,333.33 per month.
That’s it. Simple, no?
Not easy, simple.
The math is the math. How you get to that 8K is up to you.
Now, Bank Negara Malaysia claims that 6.5K is enough to support a family comprising 2 adults and 2 children. Is this true? Apparently so since we have a healthy birth rate and COL is low if you live outside of the cities.
Not going to give a broad answer that because people’s priorities and therefore monthly spend will look different. If you’re living somewhere on the east coast or rural this is a fabulous amount of money. If you have designs on living in and living WELL in Klang Valley... not so much2.
As you can see, this country is rather far off from achieving high income status. The median wage is 4.5-6k, but that’s because an elite group of high earners skew the number higher.
Actual mean wage ranges from 2.5-3.5K. Yes, it is that low.
Median monthly income of RM14,734 places you in the 90th percentile, or Top 10% of income nationwide. If you have any inclination to be financially elite here, that’s one of baby’s first milestones. If you want to look at the DOSM graph I’ve added a link here.
RM20,600 median puts you in the 96th percentile. Top 4% income.
If you’re pulling RM31K+ on average? You’ve entered the realm of the Top 1%.
Even then there’s levels and levels within that band.
So you’re a young person in Malaysia and now you’ve seen some stats maybe you’re thinking, OK cool, that’s nice, but HOW GET MUNNY? WAT DO?!?
II
Your grandparents’ generation considered law, medicine, engineering and the sciences the holy trifecta of high income careers.
That model is outdated now. Quite broken.
Starting with STEM.
Basic salary for a semiconductor engineer at a local firm is RM2,800. RM4,000 if you work at a globocorp like Texas Instruments or Hitachi.
If science? Good luck lamo. Lab techs and junior researchers get paid peanuts. Do not pursue the sciences locally unless you enjoy surviving on white bread, soy sauce, and pain.
Medicine is a mixed bag.
You bust your ass for upwards of 7 years to get your MD so you assume you make big buxx, right?
WRONG!
Average general practitioner working out of a clinic makes about 5-7 grand a month. The real money doesn’t happen until you’re well into your 30s or sometimes 40s and even then only if you specialise into something niche and in high demand.
We pay elite cardiologists up to 50 grand a month. A doctor writing scripts at a polyclinic is NOT on the same level as a doctor who can perform open heart surgery. If you’re getting into medical profession now hoping it will be high income, you need to be top 1-5% of the profession or NGMI.
How about law?
If you’re a general counsel you can reasonably expect to hit at least 15K a month at some point.
If you hit partner then the pay scales much higher. (Perhaps some lawyer frens here can chime in).
LLMs are eating paralegal jobs. Soon law firms will consist of pupils, partners, and ChatGPT.
Maybe this is hyperbole.
Maybe not.
The future is not solid ground.
You can learn from your mistakes.
Which will put you ahead of half of all people, because at least half of people lack basic self awareness and thus don’t learn from their mistakes3.
Better yet you can learn from other people’s mistakes. Like mine. It took me a great deal of time and energy to piece together everything in this post.
I’m sharing it for free because my moral compass doesn’t allow me to charge for it.
But, many will nod politely and then go back to whatever thing they were fucking up anyway because not everyone has the guts or humility to understand that someone is sharing something valuable with them.
Then they wake up at 30 wondering how come they’re still not earning a 6 figure salary.
III
So, what to do as a teenager or 20-something who wants to stack wealth?
Been saying this for the last 3 years and my answer hasn’t changed. If you are looking to optimise for income generation in your 20s only focus on enterprise sales, software dev and engineering, or finance.
Follow smart people like the anons at BowTiedBull. Read their older books like Efficiency, which in my humble estimation is still THE playbook for a young man who is trying to minmax a wealth accumulation build. Understand the thought process then apply it. It is, in fact, that simple. People just want it to be more complicated than that so when they can justify their lack of measurable progress.
Let’s have a look at some interesting figures.
IT
A full stack developer can make 20-30K a month. Usually when I meet high earning IT people, they are working a local IT job e.g., systems engineer or technical consultant that pays 7-10K and they streamline to the point where they can spend half the day working international remote jobs which double the salary from their day jobs.
A chief information officer with >10 years experience is likely to take home a monthly pay of RM25,000 to RM40,000, same for a sales director with the same number of years of experience.
Food for thought.
What about consulting?
Not bad actually even though I don’t list in the top 3.
Bain & Company pays associate consultants around RM200,000 a year. Safe to assume BCG and McKinsey match salary. Seems tempting, I know, but consulting is a golden handcuff. These people know what they’re doing.
They overpay you when you’re young so they can underpay you when you’re older.
Which is to say if you stick around and haven’t become some sort of director or partner you’re wasting your time.
Pay scale for CFOs and COOs starts at 25K.
Probably closer to 30K now. If you have the talent + skill stack + XP you can achieve this by your mid 30s.
The chief financial officer of an MNC, with 15-20 years of experience, could be looking at a pay of RM40,000 to RM75,000 per month, while a finance director with the same amount of XP could be looking at around RM25,000 to RM40,000.
The problem is that there is such a scarcity of jobs at this level that the “filter” is incredibly tough. If you don’t have Tier 1 credentials (Ivy League, Oxbridge or similar, and you have no experience at a consultancy or in senior management, your CV probably won’t even get looked at, let alone get an interview.
Sales
A sales director with a regional/APAC scope, and >10 years of experience, may pull around RM28,000 to RM35,000 per month, and a corporate communications director with the same amount of XP can RM15,000 to RM25,000.
If you have time I suggest you do a little research of your own.
IV
Here are a couple more factoids that I’m sure will make you chimp out, or at least rustle your jimmies:
In 2019, only 3.9 percent of adults in Malaysia have wealth exceeding 100 thousand U.S. dollars … This figure was 49.4 percent in Singapore
There are currently around 2,000 people in this country who earn over 2mil a year.
I hope by now you realize that the real challenge in 2023 for a young Malaysian is not achieving 100K a year. For normal Malaysians, perhaps it is. But if you’re reading this newsletter, why settle for normal?
If you are willing to work two jobs simultaneously (60-80 hours a week), anyone can get it. If you have more than one source of income then it stacks more efficiently. There is no hard and fast rule stating that only active income is considered. If you are capable of generating passive income more power to you!
The real challenge is achieving consistent 20K, 40K, or 80K months.
At 83K a month you now generate a cool 1 million MYR a year.
100 racks.
Imagine what you could do with that.
It’s like I said.
There’s levels.
And then there’s LEVELS.
Other credentials include having a touch of the ol’ high functioning ‘tism (lol) and wifi.
I know, this contradicts the findings in their report but well, what can I say, economists in any country are often out of touch with reality.
They often don’t even have the cognitive ability to recognise that they even made a mistake in the first place! This newsletter is firmly in the camp of human biodiversity. Some people can learn, some people can be trained, and some just won’t make it no matter what you do for them.