Category Archives: Personal Finance

Ramadan and Personal Finance

Ramadan&PersonalFinance

The corpus of hadith has a lot of transmitted supplications recited every after the daily prayers during the month of Ramadan. One of these supplications is a short yet concise one whose English translation is as follows:

In the Name of Allah; the All-beneficent, the All-merciful.
O Allah, gladden the people of the graves,
O Allah, enrich every poor person,
O Allah, satisfy every hungry one,
O Allah, clothe every unclothed one,
O Allah, help every debtor pay his debts,
O Allah, relieve every distressed one,
O Allah, return every traveler (to his home),
O Allah release every prisoner,
O Allah, correct every wrong in the affairs of the Muslims,
O Allah, cure every sick one,
O Allah, ease our poverty by Your wealth,
O Allah, change our evil state to a good one through Your excellent state,
O Allah, relieve us of our debts, and help us against poverty.
Surely You have power over all things.

What draws our attention in this brief supplication is the fact that contrary to the common notion, most of the things asked for have something to do with material or physical welfare. Most interesting to note is the emphasis on the repayment of debt both at the beginning and the end of supplication.

This, once again, shows the multi-dimensional nature of fasting in Ramadan, and among its benefits are the lessons in personal finance that can be derived from it.

Story #5: ‘Ali and Assem

MuslimKid&MoneyCover

After the end of the battle of Jamal, Imam ‘Ali ibn Abi Talib arrived in Basrah. During his stay in Basrah, once he went to visit one of his companions named ‘Ala ibn Zaid Haressi’. This man owned a very big and luxurious residence with all comforts. ‘Ali, after traversing his eyes on such big and magnificent building, said: “What is the use of such big residence in this world while you are in more need of a vast abode in the hereafter? If you wish to make use of it as a means to attain a spacious residence in the hereafter, you must welcome and entertain guests, be friendly with your blood relatives, clarify the rights of Muslims, take an advantage to vitalize and reveal the rights of others and neglect your personal greedy monopoly and individuality in its use.”

‘Ala said: “O Leader of the believers! I complain to you of my brother, Assem.”

Imam ‘Ali: “What is the complaint?”

‘Ala: “He has started the life of a recluse, dressed himself in rags, isolated himself from this world, and deserted everything and everyone.”

Imam ‘Ali: “Bring him in front of me!”

Assem was brought before the Imam, who turned the face towards him and said: “O enemy of your own life! The devil has stolen your sense. Why don’t you have sympathy for your wife and children? Do you believe that Allah, Who made the pure bounties of life licit for you, will be displeased with you if you benefit them? You are smaller than that before Allah.”

Assem: “O Leader of the believers! You are also like me, imposing the difficulties on yourself! You do not cover your body with soft dresses, nor eat delicious meals. Therefore I am doing the same thing which you are doing, and I am following the same path which you have chosen.”

Imam ‘Ali: “You are making a mistake. There is difference between me and you. I shoulder responsibilities of Leadership of Government but you do not. The duties of a Leader and Governor are something else. Allah made incumbent on the just leaders to take the weakest social classes of people as an example of their own personal lives and live in the same manner as the most empty-handed ones survived so that poverty and indigency does not leave impression on them. Therefore, I am having responsibilities and you have another obligation.” (Nahj al-Balaghah, Sermon 208)

Source: Murtada Mutahhari, THE NARRATIVES OF THE VERACIOUS, Story 16.

Financial Lessons of the Story:

  1. To engage in worship cannot be an excuse to abandon one’s physical necessities and social obligations.
  2. Both attachment to material things and abandonment of the good things in this world are condemnable in Islam.
  3. The Leader is supposed to serve as a model and to consider the condition of the lowest class in society.

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On the Banking System and Financial Literacy in Mindanao

mindanaobanking

MAKATI CITY (8 May) – As a financial literacy advocate and blogger, I was quite privileged to be invited last Friday (May 6) in the first forum on “The Flow of Deposits in the Mindanao Banking System: Exploring Alternatives” hosted by the Joint Ateneo Institute of Mindanao Economics (JAIME) held in Ateneo de Davao University, Davao City.

Financial Story #3: A Companion of Hajj Pilgrimage

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On returning from journey of Hajj “pilgrimage”, a man related his and his Companions’ experience who accompanied him, to Imam Sadiq (‘a). He stirred and admired them, particularly one of his fellow-travelers: “How noble was he. We are proud of accompanying such an honorable man. He was praying continuously. No sooner did we stop at a place immediately than he would part from us, seek a corner, spread his prayer mat, and engage himself in prayer and worship.

The Imam (‘a) asked: “Then, who was looking after his affairs? And who was tending his animal?

He replied: “Of course, we were. We had the honour to be at his service. He had nothing to worry about; he used to engage himself in his holy affairs.”

The Imam (a’) replied: “Therefore all of you were better than him.”

—–
Financial Lesson of the Story:
1. Not to rely on others even for a small thing.

 

(Source: Murtada Mutahhari, THE NARRATIVES OF THE VERACIOUS)

(Photo via wikihow.com)

 

Newlywed Couple and Personal Finance

Muslim Couple

MAKATI CITY (MindaNews / 13 March) – (A message delivered at the wedding reception of the writer’s high school batchmates on March 12, 2016.)

The first time I read your wedding announcement on Facebook, this was the first thing that came to my mind: contrary to the clichés that it is an avenue to do the wildest things undone before and having the tendency to disrupt family ties, high school batch reunion is meant to strengthen family ties, foster cooperation among old friends and render services to the community.

Akmad and Albeah, you are a living proof that high school reunion is indeed meant to build families.

Let me take this rare opportunity to share some thoughts on this new stage of your life journey. I shall not touch on the philosophical, religious and legal aspects of marriage as these are expected to have been tackled in the khutbat al-nikah (wedding sermon) and marriage counseling sessions you were supposed to attend.

Instead, let me focus on an aspect which is hardly given attention, yet a daily affair; that is, personal finance or money management.

On a daily basis, we handle money yet we hardly think of the need to manage it. Or, we assume that using it is identical with managing it. Or, to think of managing it is tantamount to becoming materialistic. We always say, “Bahala saging basta loving,” yet many marital conflicts and splits are money-related; either the lack of it or the improper use of it.

Formula

Personal finance experts give this formula: Income minus Savings equals Expenses. This means that as soon as we get our income, we immediately allocate a certain amount for savings before spending what we earn for the (other) expenses.

This is the opposite of the formula we usually follow: Income minus Expenses equals Savings. What usually happens is that since the amount of our expenses is equal to, if not more than, that of our income, nothing remains as savings. In fact, we often incur debts because our income is not enough for our expenses.

But by following the experts’ formula, the amount for savings is automatically allocated by considering it to be part of the expenses, nay the most priority. And after allocating the amount for savings, we adjust our expenses (lifestyle) by following the corollary precept of “spending below your means.”

Income

The first element in the above formula is ‘income’. No doubt, multiplying the streams of income is the primary recipe for financial self-sufficiency. The key is just to identify your passions – the things that you enjoy doing – and then look for the ways to monetize them.

Just give real value or love to the product or service you want to offer, and then profit will follow. Simply put, ‘passion’ plus ‘value’ equals ‘profit’.

Savings

The second element in our formula is ‘savings’. Saving is to set aside money to be spent later, and we do and must save for many reasons, viz. unforeseen (emergency) and future (retirement) expenses. But letting our money sleep for a while (saving) is not smart enough because of inflation. If the annual inflation rate is 4 percent, it means that the purchasing power of our P100 today is just P96 tomorrow.

So, we need to invest our saved money. Investing is to let our saved money grow and not just sleep. It is to let our money work for us while we are sleeping.

There are many available shari‘ah-compliant investment instruments you can choose: business venture, real estate, mutual fund, stock market, etc. Be that as it may, don’t forget the primary investment: to invest in yourselves; to invest in the enhancement of your knowledge and skills in everything you are passionate of.

Expenses

The last of the three elements in the formula is ‘expenses’ but it does not mean that it is the least important. In fact, managing it is as important as managing ‘income’ and ‘savings’ to ensure a financially successful marriage life. Multiplying streams of income must always be coupled with keeping one’s lifestyle below the income level.

Among the tips in managing one’s expenses are to distinguish ‘needs’ from ‘wants’ and to give priority to the former in matters of spending, to look for ways to save in spending, to separate ‘shopping day’ from ‘buying day,’ and to list what you must buy before buying, among others.

The details of each of these elements in the formula will be given in the book I’m currently writing – “Muslim Couple and Money: Personal Finance for Newlywed Muslim Couple.”

In closing, we, your batchmates, wish you financial success in the new stage of your life journey!

(Source: http://www.mindanews.com/mindaviews/2016/03/13/marginalia-newlywed-couple-and-personal-finance)

Short Supplication – Ya ‘Aziz

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Short Supplication – Azīz

Al-Azīz

The Mighty and Unconquerable

Azīz

He who repeats this Name 40 times after fajr (morning) prayers for 40 days will be independent of need from others.

Qur’anic Paradigm of Personal Finance

Qur'anic Paradigm of Personal Finance

“By the means of what Allah has given you, seek the abode of the Hereafter, while not forgetting your share of this world. Be good [to others] just as Allah has been good to you, and do not try to cause corruption in the land. Indeed Allah does not like the agents of corruption.” (Qur’an 28:77)

Elements of the Qur’anic Paradigm of Personal Finance:

1. Seeking the abode of the Hereafter as the primary goal in life;

2. Utilizing all the means provided by God for the pursuit of that goal while not forgetting one’s share of this world;

3. Rendering service to fellow creatures;

4. Avoiding the transgression of bounds or “causing corruption in the land.”

Supplication after ‘Isha’ Prayer

M&Minfographics03-duaafterisha

“In the Name of Allah, the All-beneficent, the All-merciful. O Allah! Verily, I lack acquaintance with the place of my sustenance; rather, I am seeking it owing to ideas that come upon my mind. I consequently wander in places searching for it. By doing such, I am as confused as the confounded, since I do not know whether my sustenance lies in a plain, on a mountain, on the ground, in the air, on lands, in seas, at whose hands, or who the source of it is. I have full knowledge that You know all these, the causes of them are in Your Hands, and it is You Who distribute it out of Your compassion and cause it out of Your mercy. O Allah, please send blessings to Muhammad and his Household and make, O Lord, Your sustenance that is provided (by You) to me expansive, my seeking for it easy for me, and its source close to me. Please, do not fatigue me by seeking that which You have not decided for me to take, because You are certainly in no need for tormenting me while I am in full need for Your mercy. [Please] send blessings upon Muhammad and his Household and confer liberally upon me, Your slave, out of Your graciousness. You are surely the Lord of great favor.”

This supplication after  the daily ‘Isha’ (night) prayer teaches many things about personal finance:

(1) Seeking sustenance is not merely raising your hands in supplication, but rather a combination of action and prayer.

(2) True knowledge (in personal finance or any field of endeavor) is the acknowledgment of one’s ignorance and affirmation of the All-encompassing knowledge and cognizance of the Self-sufficient Lord and Sustainer.

(3) Your hard work does not necessarily turn into massive income because, after all, the Ultimate Source of sustenance is not your hard work but the Self-sufficient Lord and Sustainer.

(4) The habit of supplication nurtures positive attitude toward earning for a living, which in the parlance of the Law of Attraction, inevitably invites ‘good vibration’.

Hadith on Debt as Grief and Humiliation

Hadith on Debt as Grief and Humiliation

“Beware of debt, for surely it causes grief during the night and humiliation during the day.”

(Mizan al-Hikmah, vol. 2, p. 958)

Financial Story #3: Tying the Knees of Camel

camel

The caravan being tramped for hours, tiredness overwhelmed the riders and the animals. As soon as they reached an oasis where there was water, they had their camels kneel down. The Holy Prophet (s), accompanying the caravan, made his camel kneel down and dismounted from it. All were rushing to reach the water to prepare for the preliminaries of prayer, dismounting from the camel, the Holy Prophet (s) also made his way towards the water.

After covering a certain distance, without speaking to anyone, he (s) returned back to his camel. To the surprise of his Companions, they thought he (s) was not pleased with this place and will order them to set out?! Lending the ears to him, in full attention, they looked forward to hear his order. The Companions were astonished and amazed when they saw the Holy Prophet (s) reach his camel, pick up tie and bind the knees of it; then he (s) returned back towards his first destination.

The exclamation rose up in between the Companions: “O Messenger of Allah! Why did you not command us to do that, and you bothered yourself while we are all proud of being at your service?”

The Holy Prophet (s) replied: “Do not ever ask for help from others for your own affairs and do not count upon others even if it would be a toothpick.” (Kahl al-Bassar, p. 69)

Source: Murtada Mutahhari, THE NARRATIVES OF THE VERACIOUS, Story 4.

Financial Lessons of the Story:

  1. Not to rely on others even for a small thing.