Invest Wisely

Invest Wisely



A friend of mine was telling me about the benefits of SIP (Systematic Investment Plan) in which we can invest as little as Rs. 500-1000 every month (which is not a big sum) in Shariyah-compliant companies and get very good returns after a few years.

I have been thinking about this since some days. The Qur'an also speaks of an investment plan. It calls it a goodly loan that Allah would return to us some years later when it reaches maturity on the Day of Judgment and it would be kept deposited with Him until then. He calls it sadqa/infaq/qarz hasanah.

Now let us compare the two:

  SIP:
  1. Returns are immediate, but limited. The maturity amount is not very high; actually nothing compared to the latter.
  2. Benefits are short lived. I can use the money only for a few years before I eventually die and become dust.
  3. No added benefits.
  4. Investment Company might not be secure. It may collapse under market pressure rendering my savings null and void.
  5. The investment might not be 100% Shariyah compliant. There is always some interest involved in big companies.
  6. The money I would get upon maturity may or may not make my life comfortable.
  7. No divine recommendation.


 Qarz hasanah :
  1. Returns are delayed, but they are more than 700 times the principal amount (Surah alBaqarah ayat 261).
  2. Eternal benefits. I can use the maturity amount and procure a permanent residence in Paradise which would be much bigger than the biggest house I can possibly buy on earth. (Surah Aal’Imran ayat 133)
  3. Divine Forgiveness is a bonus reward (Surah atTaghabun ayat 17).
  4. The money is absolutely secure with no fear of my money getting lost anywhere (Surah alZalzalah ayat 7)
  5. Guaranteed Shariyah compliant if invested in the right organisation.
  6. The return I would get on maturity would definitely make my life comfortable and luxurious (Surah alMutaffifeen ayaat 22-28)
  7. Highly recommended by God and His messenger ﷺ.


Investment and Loan:
"O you who have believed, fear Allah, and let every soul look to what it has put forth for tomorrow- and fear Allah. Indeed Allah is acquainted with what you do."

This is the 18th ayat of Surah alHashr. In this ayat, and elsewhere in the Qur’an, the words that have usually been translated as ‘what it has put forth for tomorrow’ basically mean ‘what the person has invested for tomorrow’. God has used examples and parables throughout the Qur’an to appeal to the intellect of human beings. This is why he uses the term investment.

At another place, He calls it a loan that would be paid back. This is also a way of encouraging man to spend his hard-earned money in the Way of God.
“Who is it that will give Allah a beautiful loan? A loan that Allah will repay after increasing it many times and grant him a generous reward.” (Surah alHadeed ayat 11)

The same has been repeated in Surah alHadeed ayat 18, Surah atTaghabun ayat 17 and in Surah alBaqarah ayat 245.

It is also worth contemplating that God calls the money that man would spend in His cause as a loan and an investment despite the fact that that money essentially belongs to Him and He has only given it to man to use it on earth, and in the end He would inherit it all (Surah Maryam ayat 40). Also, by spending in ‘His’ cause, what we are actually spending upon are fellow human beings like us- the poor, the abandoned, the displaced etc. and not on ‘Him’ in the form of some temple offering per se. This is a sign of His magnanimity and wisdom, which needs another occasion to elaborate upon.

How much to invest?
This depends upon how much a person desires the maturity amount to be. The Qur’an does give us some hints and recommendations, though. For instance, in the 219th ayat of Surah Baqarah, it is said: “And they ask you how much they should spend. Say: Whatever is beyond your needs.” This is the ultimate level of investment, and we have had people who have abided by it in letter and spirit. A cursory glance over the money (and those few dates) offered by the companions [God be pleased with them all] for the Battle of Tabuk should be sufficient to offer practical examples of the implementation of this ayat.

However, to strike a balance, the Qur’an also tells us to invest money in the worldly life with due prudence. Accordingly, we have the contemporaries of Qarun advising him:
“But seek, through that which Allah has given you, the home of the hereafter; and (yet) do not forget your share of the world.”
[Surah alQasas ayat 77]

Conclusion:
We have been told by the Prophet ﷺ that we should spend our lives on earth like a traveller. He stops at a place to rest and then continues with his journey. This life on earth is just a rest, a pause before we continue with our journey to Paradise. Investing too much on a waiting room is not a wise thing to do. It is materialism. Rather, we should focus on investing on the place in which we would be staying forever. This is prudence. And the only time to invest is now. Decide today- the transitory world or the eternal abode of Heaven.

Dr. Parvez Mandviwala

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