Eman Sakina

Money and financial health are things that we always worry about. It is what pays the rent, puts food on the table, funds our education, and – as the cliché goes – “makes the world go round.”

Friday Musings

Islam has traditionally approached the idea of money cautiously. Although having too much of it won't necessarily be a bad thing, it can easily push you into greed by deceiving you into thinking that the money you have amassed in this life will benefit you in the next.

The first thing that we all must keep in mindis to be aware of the source of money. It doesn’t matter whether we live in a majority Muslim or non-Muslim country, illegitimate sources of wealth are always there, and as Muslims, it is our responsibility to be conscious of it.

This could include the more obvious things in our religion like alcohol, pork, or clear criminal activity. When possible, find ways to make your source of income more “pure.”

As you start working to improve the quality of your income, the next step is to start thinking about your expenditures. This is not about teaching you to balance your checkbook, but rather to be wiser about where your money goes.

The following verse teaches us that through spending our wealth appropriately, God rewards us with wisdom.

“Satan threatens you with poverty and orders you to immorality, while Allah promises you forgiveness from Him and bounty. And Allah is all-encompassing and knowing. He gives wisdom to whom he wills, and whoever has been given wisdom has certainly been given much good. And none will remember except those of understanding.” (2:268-9)

The rules and guidelines regarding financial transactions, wealth management, and spending are derived from the Quran and the teachings of the Prophet Muhammad (Sunnah). These principles aim to promote fairness, justice, and responsibility in handling money while alsoencouraging charity and social welfare.

Spending by Halal (Lawful) Means

One of the primary rules in Islam is that money must be earned through lawful (halal) means. This means that wealth should be acquired without resorting to prohibited activities, such as:

Riba (Interest): The Quran explicitly prohibits interest-based transactions. Any gain derived from interest is considered haram (forbidden) in Islam.

Gambling and Betting: Activities that involve speculative risk, like gambling, are forbidden.

Prohibited Industries: Income from alcohol, drugs, or other haram businesses is not permitted.

The key Verse is: "O you who have believed, do not consume usury, doubled and multiplied, but fear Allah that you may be successful." (Quran 3:130)

Moderation in Spending

Islam encourages moderation and balance in all aspects of life, including spending. Muslims are advised to avoid both extravagance (israf) and miserliness. Islam advocates for a balanced approach where wealth is used wisely without overindulgence.

The key Verse is: "And those who, when they spend, are neither extravagant nor miserly, but hold a medium (way) between those (extremes)." (Quran 25:67)

Zakat (Obligatory Charity)

One of the pillars of Islam, Zakat, is a mandatory form of charity that every financially able Muslim must give. It is a fixed percentage (2.5% of one's savings) meant for the less fortunate, including the poor, orphans, and those in debt. Zakat purifies wealth and serves as a reminder that wealth is a trust from Allah.

The key Verse on this is: "And establish prayer and give zakah and bow with those who bow [in worship and obedience]." (Quran 2:43)

Sadaqah (Voluntary Charity)

Apart from the obligatory Zakat, Muslims are encouraged to give Sadaqah, which is a voluntary charity. It can be inany form, such as givingmoney, food, or even offeringa kind word.Sadaqah fosters community care and reduces economic disparities.

The key Hadith on this is: "The best charity is that which is practiced by a wealthy person. And start giving first to your dependents." (Sahih al-Bukhari 5355)

Avoiding Wastefulness

Islam strongly discourages wasting resources, including wealth. Spending money irresponsibly or on things that have no benefit is considered a sinful act. Wastefulness is seen as a transgression against the blessings Allah has provided.

The key Verse on this is, "Indeed, the wasteful are brothers of the devils, and ever has Satan been to his Lord ungrateful." (Quran 17:27)

Supporting Family and Dependents

Islam places a strong emphasis on fulfilling the financial needs of one's family and dependents. A Muslim is responsible for ensuring that theirfamily has enough to meet their basic needs such as food, shelter, clothing, and education.

The Hadith on this is: "The best of you are those who are best to their families, and I am the best to my family." (Sunan al-Tirmidhi 3895)

Prohibition of Hoarding Wealth

Hoarding wealth and keeping it idle without using it for constructive purposes or social welfare is discouraged. Islam teaches that wealth should circulate in society, benefit others, and be used in a manner that pleases Allah.

The key Verse on this is: "And those who hoard gold and silver and spend it not in the way of Allah - give them tidings of a painful punishment." (Quran 9:34)

Debt and Borrowing

Islam allows borrowing but stresses that debts should be repaid promptly. The Prophet Muhammad emphasized the importance of repaying debts and discouraged taking loans without a real need. Interest on loans is forbidden, and Muslims are encouraged to lend money in a way that does not burden the debtor.

The key Hadith on this is: "Whoever takes the money of the people with the intention of repayingit, Allah will repay it on his behalf, but whoever takes it in order tospoil it, then Allah will spoil him." (Sahih al-Bukhari 2387)

Investment and Business Ethics

Islamencourages entrepreneurship, investment, and trade, but these activities must be conducted ethically. Business dealings should be fair and transparent, and no form ofdeceit, fraud, or exploitation is permitted.

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The key Verse on this is: "O you who have believed, do not consume one another's wealth unjustly or send it [in bribery] to the rulers in order that[they might aid] you [to] consume a portion of the wealth of the people in sin, while you know [it is unlawful]." (Quran 2:188)