The B40,M40 & T20 distinction has always been a topic of discussion in Malaysia, especially when it comes to receiving aid during the Covid-19 pandemic.
While Malaysians are largely familiar with the classification and income threshold for B40,M40 & T20 households, the Statistics Department has released the latest figures that paint a more realistic picture.
Measuring your wealth
The B40,M40 & T20 exist to classify household income to the top 20%, middle 40% and bottom 40%.
The figures are the total income for a household – which is calculated by adding up the income of every member of a household.
This can either be one single person or a group of people (related and unrelated) who live together and make common provisions for food and other living expenses.
Based on the Household Income and Basic Amenities Survey Report 2019, this includes income from paid employment, self-employment, property & investment as well as current transfer received.
The new categories
While the B40, M40 &T20 classification remain, the Statistics Department expanded this classification of households into 10 categories based on 10 percentiles.
To be considered living in poverty, the household income is RM 2,208 per month.
Chief Statistician Datuk Seri Dr Mohd Uzir Mahidin said the Household Income and Basic Amenities Survey Report 2019 showed that B40 group comprised 2.91 million households, while the M40 group consisted of 2.91 million households and the T20 group 1.46 million households.
Based on these latest figures, the median household income is RM5,873 but almost 30.3% of Malaysian households earn below RM4,000 a month.
Interestingly enough, despite having the smallest number, T20 households account for a whopping 46.8% of the national income – which highlights the worsening income inequality in Malaysia.
So if you’ve ever wondered why you’re feeling poor lately, now you know.