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- Over 80% (83%) of Asian respondents said inflation has increased the pressure on their monthly expenses.
- Everyday essentials continue to rise in price, with grocery costs affecting 95% of respondents, followed by utilities (94%), transportation fuel (92%), healthcare expenses (91%), and cooking fuel costs (91%).
- As a result, only 25% of respondents demonstrate high resilience, down from 32% in 2025. Only 13% feel completely at ease with their financial situation.
- Facing short-term budget constraints, over half of respondents (55%) have a financial plan spanning no more than one year.
- Nearly two-thirds (61%) said they could not sustain themselves for more than six months if they suddenly lost their income.
- Households with higher financial literacy are more likely to feel confident (by 48 percentage points), more likely to feel optimistic (by 43 percentage points), and less likely to experience frequent stress due to economic conditions (by 14 percentage points).
HONG KONGJune 10, 2026 /PRNewswire/ — Sun Life Asia today released its third Financial Resilience Index: Asia’s Struggle with Rising Costs, revealing new insights into the impact of the cost-of-living crisis on the region. As high inflation continues to batter the global economy, this year’s report shows that rising living costs are increasingly straining household finances, eroding financial resilience, and leaving many families ill-prepared for future challenges. Budget pressures have intensified significantly, with over 80% (83%) of respondents saying inflation has made it harder to afford their monthly living expenses.
Sun Life Asia infographic 1 – Rising costs are changing how people manage their money across Asia
Cost-of-Living Pressures Strain Household Finances
The findings highlight the profound real-world impact of inflation. Amidst ongoing geopolitical and macroeconomic headwinds, including heightened tensions in the Middle East and resulting oil price shocks, multiple factors are squeezing household budgets. Rising everyday expenses are the most direct pressure on Asian households: 95% of respondents are affected by rising grocery costs, followed by utilities (94%), transportation fuel (92%), cooking fuel (91%), and healthcare (91%).
Nearly half of respondents (48%) cited rising costs as the biggest obstacle to managing their finances, underscoring that affordability largely drives financial decisions in 2026; over 80% (83%) said it is harder to cope with monthly expenses. In response, households are making short-term trade-offs to balance their budgets, but these compromises are coming at the expense of long-term financial security and the ability to withstand future risks.
David Broom, Chief Client and Distribution Officer, Sun Life Asia, said: “What stands out most this year is not just the scale of cost pressures, but how it is changing financial behavior. Rising living costs are forcing people to rethink how they manage their money day-to-day, with the relentless rise in prices for food, fuel, and household bills adding to budget pressures. As a result, more people are becoming increasingly focused on short-term financial decisions, and this shift is gradually eroding their financial resilience.”
Declining Proportion of Households Able to Withstand Financial Shocks
In an uncertain economic environment, the proportion of high-resilience households has fallen from 32% in 2025 to 25% this year. As household financial buffers shrink, only 13% say they feel completely at ease with their financial situation, down from 19% last year, highlighting the extent of financial strain across Asia.
To cope with rising everyday expenses, people are shortening their financial planning horizons and making decisions that impact long-term stability. Short-term decisions are becoming a key driver of declining resilience in the region: a quarter of respondents are dipping into savings, 27% are reducing or skipping essential expenses, and 10% have paused pension contributions.
Over the next 12 months, 53% prioritize managing daily expenses over saving, investing, or long-term planning. More than half (55%) have no financial plan or plan for no more than one year, and 61% say they could not sustain themselves for more than six months without external financial support in the event of job loss or illness.
Financial Literacy Boosts Confidence
While cost-of-living pressures are widespread across Asia, their impact is not uniform. Financial literacy emerges as a key differentiating factor: those with stronger knowledge and skills are more likely to feel confident about their finances and optimistic about the future, despite current challenges.
Households with higher financial literacy are more likely to feel confident (by 48 percentage points), more likely to feel optimistic (by 43 percentage points), and less likely to experience frequent stress (by 14 percentage points). These differences are also reflected in behavior: financially capable households are more inclined to plan ahead and maintain long-term financial habits, while others remain focused on immediate costs.
In a challenging economic context, access to financial information has expanded significantly, and generative AI tools are increasingly used for financial decisions. About two-thirds (60%) of respondents said they regularly use GenAI tools for financial advice, compared to 18% in 2025. However, increased access to information has not universally translated into stronger financial confidence or preparedness. Strong financial literacy remains a key differentiator in how households cope with economic pressures.
During periods of volatility, the financial resilience of Asian households is becoming increasingly uneven. While cost pressures affect households across all income levels, differences in financial knowledge and access to professional guidance are profoundly shaping how people cope. In contrast, better-informed groups are more likely to maintain confidence and stay focused on long-term financial goals amid persistent pressure.
David Broom said: “As financial decisions become more short-term, the risk is that people lose sight of long-term outcomes. Even with increased access to information and tools, making complex financial decisions still requires guidance. This is where professional financial advice can continue to play an important role, helping people turn short-term choices into long-term plans.”
Click here for the full report.
About This Survey
The study was conducted in May 2026 in Hong Kong Special Administrative Region of China, Indonesia, Malaysia, the Philippines, Singapore, and Vietnam, surveying over 6,000 respondents. It focuses on analyzing trends in financial planning, financial literacy, risk appetite, and the role of professional financial advice in building long-term financial resilience.
The index categorizes households into low, medium, and high resilience based on their sense of security and how they manage their finances. The index further reveals behavioral and attitudinal differences between groups that are more prepared and those more vulnerable to sudden shocks.
The index examines five key aspects of daily financial life:
- Financial security: Whether households feel secure or insecure about their current situation
- Planning horizon: The planning timeframe, ranging from a few months to over five years
- Emergency preparedness: The ability to cope with unexpected financial shocks
- Financial literacy: Understanding and self-assessment of personal finance concepts
- Confidence in long-term goals: The ability to fulfill future financial commitments
Together, these dimensions build a more complete picture of how households are managing current pressures and their preparedness for future challenges.
About Sun Life
Sun Life is a leading international financial services organization providing asset management, wealth, insurance, and health solutions to individual and institutional clients. Sun Life operates in multiple global markets, including Canada, the United States, the United Kingdom, Ireland, Hong Kong, the Philippines, Japan, Indonesia, India, Mainland China, Australia, Singapore, Vietnam, Malaysia, and Bermuda. As of March 31, 2026, Sun Life had total assets under management of CAD 1.58 trillion. For more information, please visit www.sunlife.com.
Sun Life Financial Inc. trades on the Toronto Stock Exchange (TSX), the New York Stock Exchange (NYSE), and the Philippine Stock Exchange (PSE) under the ticker symbol SLF.
Sun Life Asia infographic 2 – More households are focused on getting through today
Sun Life Asia infographic 3 – Today’s financial pressures can become tomorrow’s resilience gap