Can I Contribute To My Company’s Pension or 401K Plan? – Q&A

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Hatem al-Haj

Channel: Hatem al-Haj

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Episode Transcript

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Okay was but Well, if there's a pension plan where you don't contribute, of course, you're allowed, like it's one of the benefits of your job to give you a pension plan, if you would have to contribute them that contribution is voluntary. Then here, there, there may be a question here. Where are they investing this money, they're investing mesma invest money in Haram investments, and you're contributing voluntarily, the question may arise now may arise here. So, we said that when it comes to retirement plans, you know, and that is under when it comes to retirement plans,

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you will have to ask if there is a benefit in in participating in your own company's retirement plan. Keep in mind that IRAs are not necessarily limited to your company's plans, you could have your own IRA and tax benefits, you will get the tax benefits also in having your own portfolio.

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But the one thing that you would miss out on if you have your own plan is the company's matching is the matching by the company and if that is the case, and if your company is matching, whether it is one to one or like two to one, whatever it is that the company is matching, then we said

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that if we if we say this is haram, because they will take this money and invest in mutual funds, mutual funds are not necessarily or not necessarily the halaal mutual funds, which whatever mutual funds the company participates in, then

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here is what we would advise because like, if we say it is haram, then we will be basically losing trillions of dollars. If you save this harm over the world, then Muslims will opt out all over the world, Muslims will be usually losing billions of dollars, if not trillions of dollars over time.

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So if your company is marching, if there is a benefit, you know,

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over having your own portfolio, which is your own retirement plan, making your own retirement plan, if going through your company has other benefits, then you go ahead. And if you are able to convince your company and many people that this particularly when a large number of Muslims work in one company, and they are able to convince their companies to add some of the sort of

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Sharia compliant Islamic funds, the more Sharia compliant Islamic funds, there is nothing that is going to be 100%. Good.

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You know, we have to live in the reality that we live in, nothing is 100% Good, the ceria compliant Islamic mutual funds, and I don't want to advertise for them here. But just go ahead and like types, er compliant mutual funds, Islamic mutual funds, or Islamic mutual funds, and you know, a couple of names when would come up, and if you're able, and they have been doing pretty well. So if you're able to convince your company to include them among the mutual funds that your company participates in, for the interest of the Muslim workers, that would be great. If not, then you and you have the ability to basically make your own portfolio, then make your own portfolio of healthcare companies,

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if you have to select some mutual funds, then select the best mutual funds that you can select now, which which mutual funds are best.

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The ones that participate the least and you know, harm products such as the financial sector such as gambling and sort of haram entertainment industry, such as the,

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you know, liquor industry, the tobacco industry, pork industry, all of these things. So the the mutual funds that participate the least which ones are those? And, you know, honestly speaking, the financial sector and the bonds and so on and so forth, would make the mutual funds that are more secure that the low risk ones, the low risk and low profit would make them less desirable for us Muslims or you know, the higher the risk. The Hello, hello, the mutual funds. Yeah. Because the ones that invest in you know,

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what is it? The technology sector, heavily invest in the technology sector are Halla lower than the ones that have

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invest in the

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financial sector