Faith in God versus Faith in Wealth: Belief in a Higher Spiritual Power as a Determiner of Quality of Financial Life: An Abstract
Major monotheistic religions (Christianity and Islam), comprising of 55% of world religions’ followers (Hackett and Mcclendon 2015), conceptualize God as a supreme power who is in charge of the affairs of the universe and is the planner and an executor of everything that occurs. Religious philosophies of these religions encourage minimalism in personal life aspects, charitable behavior, as well as long-term orientation (belief in afterlife in heaven/hell). Therefore, the reliance of religious people on possessions/wealth is expected to be less as compared to nonreligious people. It may make them less likely to take measures to ensure their financial well-being. Since religious affiliations affect choices of consumptions and life behavior profoundly, it is valuable to assess the effect of religiosity on financial behavior. Statistical trends hint at the low financial well-being of religious people, but the phenomenon remains largely underexplored and calls for more investigation.
Religious institutions transmit values, which eventually may affect choice. Also, organized religion fosters or frowns upon particular choice behaviors (Wilkes et al. 1986). More specifically, past research shows that religious beliefs can influence financial decision-making (Hirschman 1983, Essoo and Dibb 2004, Beck and Brown 2011). To explore the phenomenon further, the authors use data from the 2010 National Longitudinal Survey of Youth 1997 (NLSY97). A multinomial logistic regression analysis of financial and religion variables captured in the survey data reveals that people who think religion is important were more likely to discuss their financial situation with others, had a more positive subjective description of their current financial condition, as well as were more likely to use cash advance on credit cards than the basement group (indifferent to religion). A significant gap occurs between the perceived present financial condition and the financial behavior of religious people as compared to general people. Since a considerable world population is religious, it is valuable to address the issue of lack of financial well-being of religious individuals.
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