Measurement of Islamic Financial Well-Being: Towards a Holistic Value-Based Framework
Keywords:
Financial Wellbeing, Islamic Financial Wellbeing, MeasurementAbstract
The measurement of financial wellbeing (FWB) has garnered significant global attention, particularly as societies face increasing economic uncertainty and rapid financial innovation. In conventional financial literature, FWB is generally defined as a state in which individuals can manage their current finances, feel secure about their future financial situation, and exercise the freedom to make economic choices that enhance overall quality of life. However, most existing measurements of FWB remain limited to objective, subjective, and multidimensional dimensions, thereby neglecting the spiritual and psychological aspects that are central to the Islamic worldview. This study aims to propose a new conceptual framework for measuring Islamic Financial Wellbeing (IFWB) by integrating three key dimensions: spiritual, psychological, and financial behaviour in accordance with Islamic principles. This framework is articulated through theoretical propositions that can guide future empirical research and facilitate the development of validated measurement scales. By introducing a more holistic and values-based perspective, this study expands the scope of FWB research beyond conventional paradigms and enriches the academic discourse on financial wellbeing within the Islamic context. Furthermore, this study provides practical implications for regulators, financial institutions, and policymakers to design inclusive, sustainable financial strategies that align with Islamic principles. Most importantly, the proposed framework has the potential to be tested and adapted across both Muslim majority and minority contexts, thereby offering a foundation for advancing global discussions on financial wellbeing from an Islamic perspective.
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