Zakat on your retirement savings

[Holac]

I started saving for my retirement recently after reading good articles about the benefits of saving early. I googled 401-K and zakat topic and I found differing answers.

 

I would like to hear your personal experience and how you handle zakat on retirement savings.

[Tallaabo]

I had the same dilemma before and still have no concrete answers to my questions.

[Bluelicious]

This is something I would like to know too. As far as I know a person has to pay 2.5% zakaat on money that they have been saving for at least a year. I'm not sure I could be wrong.

[ElPunto]

From everything I've read - the consensus is if your retirement/pension savings are involuntary or automated - that is you don't actually see the money and you don't control the money - ie buy and sell securities - then you can defer zakat. But if you take a sum of money under your control and buy Microsoft stock with it - you should be paying zakat on it provided you meet the requirements of paying zakat.

 

It seems access and control would define whether zakat is owed in a current period or a future period. Ultimately when you get access and control - you must pay zakat. This is a common sense religion. I would also advise people to pick and choose halal investments(where you have a choice) - and/or a mix with the vast majority halal investment. There are a lot of fixed instruments (ie interest bearing) or financial securities (ie banks) that should be avoided.

[Holac]

Thank you Tallaabo, Bluelicious (aren't you pretty. ) and ElPunto.

 

I am leaning towards not paying zakat on my 401-K. The way my account is setup, I don't have access to it unless I leave the company. I read that if I don't have access to it, I should defer paying it.

 

If anyone did any research on this topic in the past, I would appreciate your thoughts.

 

 

 

[Tallaabo]

My pension pot is probably being invested in brothels, bars, and banks!!

[Mooge]

i am not old enough to worry about that