Buddhist temples in Japan are increasingly turning to investment income as declining visitor numbers, reduced funeral ceremony income, and rising maintenance costs place pressure on institutions that have traditionally relied on donations.
Fifth-generation Buddhist priest Koukyo Yoneta, at Kongo-ji, a temple in Hokkaido, has invested donated funds in US Treasury securities, Japanese real estate investment trusts, and stocks including BYD and Hyundai. Over two years, the investments returned more than 10 per cent annually, helping to fund approximately ¥25 million (US$162,000) in repairs to the 100-year-old temple. (The Japan Times)
Yoneta previously worked in retail sales for Daiwa Securities Group before leaving to train as a Buddhist monk. He inherited Kongo-ji from his father in 2018.
“I’m just so thankful that the investments performed well,” Yoneta said. “With the funeral business shrinking, more and more temples will find they can’t just rely on donations to meet their funding needs; they will have to build up reserves and invest those funds.” (The Japan Times)
The financial pressures reflect broader changes facing Buddhism in Japan. The country’s Buddhist population has declined by approximately 14 per cent over the past two decades, while younger generations have become increasingly disconnected from traditional religious practices. In rural areas, priests may oversee several temples while also working outside jobs, including as teachers or civil servants.
A 2021 survey of 7,000 temples conducted by the Japanese Buddhist organization Jodo Shinshu Hongwanji-ha found that around half reported annual income below ¥4 million (US$25,000). Funeral ceremonies and the maintenance of family graves have traditionally provided important income for temples, but spending on elaborate funerals declined during the COVID-19 pandemic and has remained lower as household costs have increased.
While seen as necessary by many, the shift toward investments has raised questions for Buddhist priests around the traditional religious emphasis on non-attachment and avoiding greed.
At Daian-ji, a temple in Nara Prefecture, most assets are held in cash, but approximately 10 per cent have been allocated to foreign-currency-denominated insurance products offering higher interest returns.
“There is an inherent contradiction in our position,” said deputy priest Yusho Kono. “In principle, monks should not engage in profit-making activities. But if we do not take any action now, the temple could cease to exist.” (The Japan Times)
Kono described the temple’s investment strategy as “purely defensive.” Rising production costs for traditional silk amulets sold at Daian-ji have added to the temple’s expenses.
Other Buddhist organizations are also cautiously entering financial markets. Soto-shu, which oversees approximately 15,000 temples in Japan, manages about ¥13 billion (US$82,530,000) across eight accounts. Around 10 per cent is invested in Japanese government bonds intended to be held to maturity, while another 2 per cent is invested in debt issued by the Japan International Cooperation Agency to support development projects in emerging economies.
The trend extends beyond Buddhist institutions. Bank of Japan figures show that nonprofit organizations, including religious institutions and schools, held approximately ¥5 trillion (US$32 billion) in corporate bonds as of March, roughly twice the amount held in 2023. Japanese government bond holdings increased from ¥2.5 trillion (US$16 billion) to ¥2.9 trillion (US$18.4 billion) during the same period.
Japan’s Buddhist institutions have previously experienced significant investment losses. In 2013, Koyasan Shingon-shu reported unrealized losses associated with investments in structured bonds, an episode that continues to underscore the risks involved in temple asset management.
A senior researcher in SMBC Nikko Securities’ corporate investment strategies department, Tsuyoshi Kawata, argued that demographic decline made simply charging more for religious services increasingly difficult.
“When the overall market is shrinking, raising prices is not really an easy option,” Kawata said. “Leaving cash sitting idle is probably no longer an option either. They would want to use whatever means they can to increase income, even if only slightly.” (The Japan Times)
Yoneta is also holding investment seminars for members of his temple community, hoping to strengthen relationships that may help sustain Kongo-ji in the future.
“The days when temples and their priests enjoyed a privileged status are completely over,” Yoneta said. “How temples plan their finances and manage their assets is becoming an issue we simply cannot afford to ignore.” (The Japan Times)
See more
Japanese Buddhist temples invest donations amid inflation and falling income (UA News)
Japanese temples turn toward financial investment amid declining congregations (Maeil Business Newspaper)
Japan monks turn to investing as shrinking congregations squeeze temple finances (The Japan Times)
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