Toward a new conceptualization of financial well‐being

Abstract

Research on financial well-being is still in its nascent stage, despite being an important topic in consumer research. Research on the antecedents of financial well-being is even more limited. Using in-depth interviews with consumers and practitioners, and expert discussions, this article conceptualizes the construct of financial well-being from underdeveloped countries' perspective. We conceive financial well-being as a confluence of four situations—namely, meeting present and future financial commitments; feeling of financial security; freedom of choice; and improved quality of life. Our findings reveal that the objective and subjective financial measures are critical predictors of consumers' financial well-being. Financial behavior, which is caused by antecedents such as financial knowledge, personality traits, and mindful finance, intervenes this relationship. Based on this analysis, we propose five propositions concerning antecedent-based interventions for future scholarship in the field. The paper suggests a theoretical framework illustrating behavioral interventions in a given socio-economic environment to achieve financial well-being. Our results pave the way for the advancement of the theory in financial-well being and its antecedents in different socio-economic environments. The managerial contribution of this study lies in informing the marketers to contextualize their strategies to the financial well-being. We also inform the macroeconomic policymakers to design behavioral interventions to improve the financial well-being.

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