I've been a muslim almost a year and sadly, I must say, that my job is haram. My college degree is in finance, and I currently work in the investment industry in Boston. Obviously I want to change careers so that I can have a job that is halal, as I feel this is the one major thing keeping me from becoming a truly pious believer.
The hard part is that I also need to maintain a reasonable salary due to the high costs of living in Boston (we recently moved from Seattle to Boston for my wife's job).
I had actually joined the company I work with now with the intention of being able to go overseas for an international assignment (as is common in the company) and work in Islamic finance (they are a huge company with offices in every major muslim country). Sadly, however, I have come to realize that Islamic finance is no different from the current system we have in place today.
Because of this, I'm looking to go in an entirely new direction, which is scary given that my speciality is in finance. Although I'm willing to take risks, it's harder to do when you're married.
So I'd like it if members could reply to this with examples of halal jobs that can earn a decent salary (since I'm in Boston, I'm looking at anything above $40K per year insha Allah).
Work as an associate in a top accountancy firm? I am assuming you work within fixed income/S&T/IBD, accountancy firms will probably look highly upon that. Another move is, to go into consultancy. But, I am not familiar with the pay in the U.S.
Work as an associate in a top accountancy firm? I am assuming you work within fixed income/S&T/IBD, accountancy firms will probably look highly upon that. Another move is, to go into consultancy. But, I am not familiar with the pay in the U.S.
The firm I work for is actually an accounting firm (one of the Big 4), and I work in the auditing division in the investment management sector. I deal with both fixed income funds and equity funds, but it's all haram anyways so it doesn't really matter what part of finance I concentrate in.
The same can be said about accounting, due to the fact that you deal in recording interest expenses, and you can never control which clients you get (thus a high chance of dealing in something haram).
That's why it's my intention now to avoid it altogether if I can. Whether I'm working for an investment firm dealing directly with a security, auditing that company's financial statements, or consulting on financing matters for that firm, I am cursed just the same.
with a degree in finance you can pretty much do almost anything..maybe you can try to work with a Islamic company that does not deal with interest...???
I wish you the best brother...and I hope everything works out for you
The firm I work for is actually an accounting firm (one of the Big 4), and I work in the auditing division in the investment management sector. I deal with both fixed income funds and equity funds, but it's all haram anyways so it doesn't really matter what part of finance I concentrate in.
The same can be said about accounting, due to the fact that you deal in recording interest expenses, and you can never control which clients you get (thus a high chance of dealing in something haram).
That's why it's my intention now to avoid it altogether if I can. Whether I'm working for an investment firm dealing directly with a security, auditing that company's financial statements, or consulting on financing matters for that firm, I am cursed just the same.
I don't think recording interest expenses is haram (because, you are just creating financial reports for companies if I recall correctly?) - Unless someone can post some daleel?
I mean I thought it was those who make profits through riba, or help create a riba transaction. As far as I was aware, in the Big4, you probably arn't involved with that - you are just an auditor - you just record stuff - and your salary is somewhat fixed, with few performance bonuses, but nothing like that of an investment bank. I would have deemed, an auditor at an accountancy firm, perfectly halal (know muslim accountants, who are scholars too).
with a degree in finance you can pretty much do almost anything..maybe you can try to work with a Islamic company that does not deal with interest...???
I wish you the best brother...and I hope everything works out for you
Allahu Alum
Again, Islamic finance is no different that traditional finance. When it comes to loaning out money, Islamic banks have all these tricky ways to get around interest, but in the end you either end up paying the same amount or more than a conventional bank. They are not focusing on the principle of the matter, and that is that one should not be making money from loaning money (ie, you can't profit from a loan no matter how you structure the deal).
In the time of Muhammad (SAW) and even in Europe up until the Industrial Revolution, many believed in a bank that served the community and did not profit from it. Thus, loans were made with no interest obligations. That's the spirit of the law from the Qur'an that people are missing altogether.
As for Islamic investing; in theory it's OK to invest in something in hopes to turn a profit. Nothing wrong with that. The problem is that virtually every company uses interest based loans to finance its operations, thus they are getting their wealth from haram sources. To invest in these companies would be to cooperate with them and share in this haram financing. If you could find a company that both sold halal goods (or whose business practices were halal), and they didn't use debt to finance their operations, then this would be OK. But unfortunately that's not the case in today's world.
Islamic Finance has come up with a magic 33% debt to equity rule. Why is there this compromise? So if a company has 34% debt to equity, it's unacceptable, but if they have 32%, then BAM - halal! Do we compromise when it comes to pork or alcohol? No. Then why do we do it with investments. Surely Allah SWT has made the prohibitions on riba just as strong as those on pork and alcohol.
In response to brother SixTen's question:
"Prophet Mohammad (pbuh) cursed the one who deals with Riba. From Jabir (ra): The Prophet (pbuh) cursed the receiver and the payer of riba, the one who records it and the two witnesses to the transaction and said: "They are all alike [in guilt]." Bukhari and Muslim
The hadith talks about, involvment in the transaction. Are you not, just an auditor? You do not fall under the category.
You see, contracts were made for such transactions, hence, one who is recording it, is duly in the process of such a transaction.
To give an example, would be, you in a Bank, someones interested in a loan, and you do the paperwork, the contracts and all that legal stuff.
So, can you detail your work? I didn't see you doing this as an auditor in a Big4 firm, but merely recording spendings and expenses of company (which could be taxse, interests, bills etc)- for the purpose of making sure the company adheres to the financial laws, and also to create accurate financial reports of companies. You arn't involved in the riba transaction are you?
What I am asking is - are you involved in the riba transaction? That is, forming the contract, or getting someone to take one. Or are you just stating "This company has spent this much in interest, or gained this much in interest" which I thought auditing would be.
If I was you, I would give an extremely accurate detailed account of what you do and go to a scholar.
The hadith talks about, involvment in the transaction. Are you not, just an auditor? You do not fall under the category.
You see, contracts were made for such transactions, hence, one who is recording it, is duly in the process of such a transaction.
To give an example, would be, you in a Bank, someones interested in a loan, and you do the paperwork, the contracts and all that legal stuff.
So, can you detail your work? I didn't see you doing this as an auditor in a Big4 firm, but merely recording spendings and expenses of company (which could be taxse, interests, bills etc)- for the purpose of making sure the company adheres to the financial laws, and also to create accurate financial reports of companies. You arn't involved in the riba transaction are you?
What I am asking is - are you involved in the riba transaction? That is, forming the contract, or getting someone to take one. Or are you just stating "This company has spent this much in interest, or gained this much in interest" which I thought auditing would be.
If I was you, I would give an extremely accurate detailed account of what you do and go to a scholar.
What I do is make sure the price of a given mutual fund is correct. I do this by determining the correct prices of all the securities in the mutual fund (looking up the price on Bloomberg as well as the double checking with the sources the client provides).
I am basically auditing the price of the fund and ensuring that the sources for all the fund's prices are correct and accurate within a certain degree. I do not work with verifying interest expenses or income on a fund, but I do deal with auditing prices of bond funds as well as equity funds.
The problem is there are so few scholars in the world with knowledge of finance in shari'a. I find IslamQA to be too black and white when it comes to rulings on shari'a finance, and they do not give weight to individual circumstances and the various issues involved. This is understandable given the fact that they are not specialists in shari'a finance.
I have been trying to find someone who can shed some light on this, but nobody I know personally is knowledgeable on this area. If there is a source online I can write to, then please let me know so that I may inquire about this issue. Until then, I will probably continue to be in doubt about my job (although I'm not just going to quit my job). Alhamdulilah at least my job allows me to pray all the prayers on time in a quiet room and allows me plenty of time for Jumuah.
Sadly, however, I have come to realize that Islamic finance is no different from the current system we have in place today.
I really dont have any idea about finance or any other business thingies(well did accouinting in my AS but that's just about it as because I'm a science student) but your post makes me think, if its the same as regular investment then why the term "Islamic Finance" has been applied?,is it because Muslims are running a particular investment group or something else?, I'm very curious.
I really dont have any idea about finance or any other business thingies(well did accouinting in my AS but that's just about it as because I'm a science student) but your post makes me think, if its the same as regular investment then why the term "Islamic Finance" has been applied?,is it because Muslims are running a particular investment group or something else?, I'm very curious.
Basically Islamic Finance falls into two categories: Banking and Investing.
With banking, most Islamic banks are basically charging interest in an indirect manner. They operate using Lease to Buy schemes or something similar. The bank buys the house and then you pay the bank each month in order to increase your share in the house, with an additional "rent" payment in order to live in the house.
The base payment you make is called Principle in traditional finance, and the rent is called interest. There is no difference. What they fail to recognize is the basic principle of lending in Islam: you should only lend people money out of goodwill and never to make money from it. A truly Islamically financed house would be financed in a sort of joint venture/partnership by the bank and homeowner. Both invest in the property and the venture pays off (or not) when it comes time to sell. But there would be no payments of any sort made that pays the bank over time. This kind of venture is very risky and hard to find investors for, and it can also be a very long term investment in the end (since the profit only comes when you sell the house and that could be 20 years down the road).
When it comes to Islamic investing, these investment companies are basically saying that it's permissible to invest in companies that have debt, so long as the debt does not equal more than 33% of their equity, it's OK. Imagine that; 34% debt to equity and it's haraam, but 32% debt to equity: halaal! Some companies also find it permissible to invest in stocks that hold a small percentage of alcohol, pork, gambling, etc related investments (some scholars call this "permissible impurity".
This is unacceptable in MY OPINION. Are we allowed to drink something if it contains 32% alcohol, or 32% pork, etc? No. So why should investments be any different?
Investing in and of itself is not haraam; it's perfectly OK to invest in something provided the investment itself is halal. But the way the company runs their business must also be halal. They should not be borrowing money from a bank or using any other means of interest to finance their operations. If they are, then you as an investor are sharing in those profits derived from interest.
But because virtually every company under the sun uses a bank to finance their business (even companies like Apple and Microsoft with huge amounts of cash use loans to finance their payroll each period), investing in today's stock market is basically out of the question in my opinion.
Please remember that I am not a scholar, but merely a student of knowledge. If one truly has a grasp on basic Islamic principles and financial principles, then one would probably arrive at the same conclusion I have.
Also, google "Let's Buy a House Islamically". It's a great lecture that really opened my eyes to this stuff. Remember, don't take my opinion as a fatwa or anything, I'm just expressing my view.
I agree there is no islamic banking system - Riba is everywhere - what are the scholars doing about this - is there any way out of it beacsue this is a real serious mess. To buy a house Riba is needed - loan - Riba - buy a business - Riba/ everything is controlled by Riba.
I agree there is no islamic banking system - Riba is everywhere - what are the scholars doing about this - is there any way out of it beacsue this is a real serious mess. To buy a house Riba is needed - loan - Riba - buy a business - Riba/ everything is controlled by Riba.
May Allah save us from Riba - Amen
This is what the Prophet (pbuh) warned the sahaba about.
The problem is we're trying to implement Islamic ideas into a secular system based on interest, which can't be done. There are very few scholars taking a stand against Islamic finance, and that is unfortunate. Money talks, and many listen.
I think what we as Muslims in the west need to do is really get to the core of the matter. Instead of trying to live just like everyone else in the country, we need to get back to basics.
For instance, work with what you can afford. If you can't pay for a house with cash (which very few people can do), then just rent. Sure you're not building up any ownership in a piece of property, but what's more important: equity or akhira?
Instead of living beyond our means trying to buy things with credit cards and getting personal loans, pay cash. Use your debit card only and cancel your credit cards, so the temptation is not even there.
In a few years I hope to be completely free of riba insha Allah. I must say it is an ugly disease and the only way around it is to adopt a lifestyle of living within your means. It may mean you can't get the newest model car, ownership of a house, or other luxuries we have grown accustomed to in the west.
Also, consider that by having a loan for a house or having credit card debt, you are a slave to that debt. You work harder just to pay it off. It may haunt you in your prayers and drive you further from worship with Allah SWT.
One word my friends: SIMPLIFY. Make life simple and you can focus more on the deen. I'm not there yet, but I hope to be. Insha Allah!
I've been a muslim almost a year and sadly, I must say, that my job is haram. My college degree is in finance, and I currently work in the investment industry in Boston. Obviously I want to change careers so that I can have a job that is halal, as I feel this is the one major thing keeping me from becoming a truly pious believer.
As salam wa alikum,
Brother auditing in my view is perfectly halal.
Note: I am a high school student and want to pursue a career in auditing that is why I have dona a lot of research in this and i dropped investment banking for this reason.
Why auditing is halal:
1) You are not involved in paying or receiving interest
2) You donot advice other to pay or receive interest
3) The company you work for earns from auditing and consultancy services
“Those who swallow down usury cannot arise except as one whom Shaitan has prostrated by (his) touch does rise. That is because they say, trading is only like usury; and Allah has allowed trading and forbidden usury. To whomsoever then the admonition has come from his Lord, then he desists, he shall have what has already passed, and his affair is in the hands of Allah; and whoever returns (to it) - These are the inmates of the fire; they shall abide in it.”
“O you who believe! Do not devour usury, making it double and redouble and be careful of (your duty to) Allah, that you may be successful. And guard yourself against the fire that has been prepared for the unbelievers."
A Brief Description of the Question: Is the money that a person earns by working in a bank haram? Can his children spend the earning of that person?
The Answer:
Those who are engaged in haram through interest (riba) are described as follows in a hadith:
«A person who eats and make others eat interest, who becomes a witness for interest and who writes the transactions of interest becomes far away from the mercy of Allah.» (Muslim, Musaqat, 105)
In the verse, those who eat interest are mentioned but in the hadith the person who eats and make others eat interest, who becomes a witness for interests and who writes the transactions of interest are mentioned one after another and they are expressed to be far away from the mercy of Allah all together.
Accordingly, those who work in the institutions that are engaged with interest do not eat or make others eat interest directly but they carry out the transactions, make calculations, and carry out the correspondence and the administrative works of interest. Whether they are clerks or administrators, they are included in the content of the concept “katib” (scribe) mentioned in the hadith.
It is not something recommendable for a person who knows these issues to work in institutions like that intentionally. It is not possible to regard excuses like “I could not find any other jobs”, “I am obliged to work there” as justifiable. Permissible and legitimate areas are large enough for a person to meet his needs. The salary of a job in a legitimate area may be less than one in a bank but it is not shady. Besides, it is very difficult to regard working in an institution based on interest as an obligation.
Those who have started to work in an institution based on interest but later have learnt about its prohibition in Islam are not recommended to stay there and to continue working there if they find other jobs to earn their livings. They need to try to find legitimate jobs.
Meanwhile, they should try to carry out their spiritual and Islamic services better and earn more thawabs (rewards) because good deeds eliminate sins.
It is necessary to state that if the institutions that are engaged in haram business also have branches that are engaged in halal business and earn money from both, it cannot be decided that all of the income of that institution is haram; the situation is relieved a bit in that case. It is not regarded to be engaged in haram business for a person if he works for the companies of that institution that are engaged in useful areas like constructing roads, bringing water, electricity, etc.
Children are not responsible for the haram earnings of their parents. What they need to do is to repent, not to be engaged in haram business any more and to give money to charity.
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