RELIGIOUS MATTER: CHRONICLES OF THE MUSLIM [Ramadan Series 2] (Islamic personal Funance) By: Thanni Mustakeem

As a Muslim managing your personal finance might seem to be overwhelming, especially by young Muslims just starting out in life. 
While it's tempting to delay learning about your personal financing until "later", the sooner you build a good financial plan that's inline with sheri'ah the more you live a life without being extravagant. Allah discouraged being an extravagant, Allah says;  “And thus do We recompense him who is extravagant and does not believe in the communication of his Lord; and certainly the chastisement of the Hereafter is severer and more lasting.” (Surah Tā Hā, 20:127)
Hence, according to the above quoted ayyah, it's a religious duty to plan financially in order not to spend in an extravagant manner. Here are few tips that can assist you with your personal financing. 


*Invest in your career*

The single most crucial thing you can do for your financial security is to invest in your career. If you haven’t already, you should start now. Your prime financial goal when you’re in your late teens and early 20’s is to get yourself situated in a good, halal profession. You need a skill that gives you value in the market. Before you can figure out how to manage your money, you need to have a way to earn some.

*Be an Islamic personal finance literate*

Educate yourself about planning your personal finance. This article is just to inform you about the important of Islamic personal financing and a starting point to get young Muslims thinking about Islamic personal finance. Don’t consider it anywhere close to a comprehensive guide for your finances. 

*Establish a budget*.

Allah, may He be exalted, says: “Let the rich man spend according to his means, and the man whose resources are restricted, let him spend according to what Allâh has given him. Allâh puts no burden on any person beyond what He has given him” [al-Talaaq 65:7]. Understanding the ayyat quoted above, you have to know where your money is going. And it should be spent according to what you earn. 

*Build an Emergency Fund*

You don’t want to be in a position where any unforeseen expense can land you into debt. Build an emergency fund that is equal to 6 months’ worth of expenses. Put away 10-15% of your paycheck until you get this emergency fund. Keep the emergency fund for emergencies. This isn’t a slush fund to dip into to pay for discretionary expenses. When you use up money in your emergency fund, make it a priority to refund it and get it back to its baseline as soon as possible.

*Pay your debt if you have any*

The Prophet ﷺ said “By the One in Whose hand is my soul, if a man were killed in battle for the sake of Allah, then brought back to life, then killed and brought back to life again, then killed, and he owed a debt, he would not enter Paradise until his debt was paid off.” (Sunan an-Nasai). You do not want to ever be in debt. And this is talking about halal debt, not riba debt

*Get Health Insurance (TAKAFUL)*

Although it might not seem like it, health insurance is actually a very important part of personal finance. Exorbitant medical expenses is one of the biggest reasons people end up bankrupt. If you have a job that offers health insurance, look at the various options. If your job does not offer health insurance, look around you will surely find an affordable one example is Africa Alliance Takaful.

*Save for your retirement*
Yes, now, even if you’re in your early 20’s. Getting in the habit of saving money for retirement early sets the standard for you. Immediately siphoning a percentage of your paycheck into retirements savings gets you in the habit of forgetting the money even existed. If you saw only N1000 a month from the age of 25 and get an 8% return, you’re looking at well over a quarter million Naira in your retirement account by the age of 65.
*Give Alms*
You will not get barakah in your money until you are giving out a portion of your wealth to the poor and needy. This does not have to be a huge sum but it should be consistent. You can start with something as small as a N100-N200 per month. Imam Ali has said: “If you are reduced to poverty then trade with Allah (swt) through charity.” 

Islamic personal financing is not limited to the above tips. Hence, I'll advice you read more on personal finance so you can be guided in your financial life. 

*Thanni Mustakeem A. MMT(Nubia).*

2nd of Ramadān 1440AH. 
7th of May 2019.