The Influence of Spirituality and Religion on Financial Decision-Making: A Behavioural Analysis

Abstract

Numerous facets of mental health and decision-making processes are known to be impacted by spirituality and religion (S/R). The behavioural and cognitive underpinnings of S/R, especially when it comes to financial decisions, are still poorly understood despite their complexity and diversity. This study examines how spiritual beliefs, religious attitudes, and participation in religious rituals affect individuals' financial decision-making. Specifically, we explore whether S/R fosters greater behavioral consistency, helping individuals regulate impulsive reactions when faced with financial gains or losses, thereby promoting measured financial decision-making. We used the Sequential Investment Task, which examines how individuals modify their behaviour in response to hypothetical and actual financial outcomes, to look into this. A wide range of self-report measures were used to evaluate the spiritual and religious views of 280 participants in a community-based sample. We sought to understand how S/R affects behavioural consistency, risk tolerance, and impulsivity in financial decision-making by examining reactions to financial wins and losses.