Muslim Life Hackers
Get better every day with the Muslim Life Hackers podcast. Through conversations with experts, leaders and inspiring individuals, we are going to give you actionable insights help you win in this life and the next.
Muslim Life Hackers
Dr. Tanvir Uddin: Conscious Budgeting and Wealth Building
In this episode, Dr. Tanvir Uddin, the founder and CEO of Wholesum, a FinTech company focused on making investments accessible for Muslims, shares how Muslims can approach finance holistically, from managing money to using it to make a positive impact.
Timestamps:
02:51 The Power of Financial Empowerment
04:06 The Role of Finance in Society
07:36 The Importance of Financial Independence and Education
12:25 Understanding Exchange Traded Funds (ETFs)
14:01 The Importance of Financial Planning and Investment
19:58 Understanding Short-Term and Long-Term Investment Options
24:00 The Role and Risks of Managed Funds
28:47 The Challenges for Muslim Investors in Australia
29:36 The Controversial Topic of Cryptocurrency Investments
33:15 The Importance of Asset Allocation and Budgeting
About Dr. Tanvir Uddin:
As a serial entrepreneur, Tanvir loves innovating at the intersection of access to financial services, technology and sustainability. He is the Founder of Wholesum, a platform to increase access to unique positive impact-focused, halal investments. Tanvir holds a PhD from the University of Sydney where his thesis examined the intersection of Islamic law and sustainable development through microfinance programs.
Connect with Dr. Tanvir Uddin:
Resources Mentioned:
Sign up to the Muslim Life Hackers newsletter: https://muslimlifehackers.substack.com
Listen to the Podcast:
Connect with Muslim Life Hackers:
Connect with Mifrah Mahroof:
🏖️ This episode is sponsored by Sisters Explore, a company I founded to offer guided small-group travel for Muslim women to connect, explore, and enjoy faith-centered journeys. Learn more at http://www.sisters-explore.com
Disclaimer: Some links in this description are affiliate links.
So, I think it's something to think about that, it's not just always about the seeing the dollar signs and making a lot of money. As Muslims, we should be very holistic in how we approach things just as we, care about the animals that we slaughter for, meat consumption just as we think about the ethics of dealing with people and how we treat them, it's not just about a transactional relationship.
Mifrah Mahroof:As-salamu alaykum and welcome to the Muslim Life Hackers podcast. I'm your host Mifrah Mahroof and this is the podcast where we get better every day. Through conversations with experts, leaders, and inspiring individuals. We're going to give you actionable insights to help you win in this life and the next. So if you're ready to level up in every area of your life and you committed to living with excellence for the sake of your Lord. You're in the right place. Get ready for insights, inspiration, and a whole lot of life hacks. This is a Muslim Life Hackers podcast. Let's dive in. As-salamu alaykum Tanvir, welcome to the show.
Dr. Tanvir Uddin:Thanks Mifrah. Thanks for having me.
Mifrah Mahroof:Well, thank you for coming on, and, I'm super excited. I know there's lots to learn from you. First of all, for those who don't know you, can you just give me a quick introduction about your background and what you do?
Dr. Tanvir Uddin:Sure. I am, a founder and, uh, CEO of wholesome. it's an impact investment, FinTech, uh, trying to make investments obviously available for Muslims. We work with Sharia advisors and scholars, to check the underlying investments. and also trying to benefit the general community with accessing more investments that align with obviously Sharia principles, but also are out there to try and make a positive difference in the world. in terms of my background, I am originally from Bangladesh, and born there and raised in Australia, in Sydney. I've spent most of my career working at the intersection of finance. Technology and sustainability and a positive impact. and I've done that through working from the grassroots with farmers in Indonesia to working on large solar farms with the Islamic Development Bank. And more recently, innovative, sustainability, fintechs like Bright and, Vyro, which I also was a co-founder of. That all led me down the path of trying to empower communities with finance and of course, making sure it's accessible to more people such as Muslims who are very keen about Sharia compliance. Trying to make those bridges and those networks. So that's in a nutshell about myself.
Mifrah Mahroof:Oh, MashaAllah. so from what I understand, your startup is more towards
Dr. Tanvir Uddin:So we can accept clients, investors from around the world. our license restricts us from being able to market as a financial product. it's a financial service is extremely regulated, and hence, while of course, people are really interested in it. We can only market in Australia, Singapore, and New Zealand, but we do accept clients from around the world.
Mifrah Mahroof:Oh, okay. I didn't actually know that for some reason I thought it was just Australia, cause that's an assumption normally when you hear about, Financial services, it's limited to the country. Okay, so you mentioned that point about empowering, communities, financially, and I think it's a really interesting way on how you're looking at making an empowerment. So it's like financial empowerment.
Dr. Tanvir Uddin:Yeah. my first experience with finance and also Islamic finance for that matter, was working in Indonesia with farmers and it really struck me that how a small amount of money could really free up. People from the shackles of poverty and from debt bondage. So the story of a Sharia is about working with coconut sugar farmers who were often in a debt relationship with the trader that purchased the harvest that they sold to, and the farmers just needed a few hundred dollars to get out of that bondage situation. And that's where finance can unlock that by giving small access to capital, they're able to invest into their farm. They can grow their farm operations and harvest, and also then provide a share of the profits back to the investor who provided that finance. This is a key as it's a financial empowerment for both sides. It's financial empowerment for investors because they are able to invest in something that's obviously halal, but also is providing a commercial return and it's financial empowerment for the beneficiary who's receiving that finance to undertake the activity that they need. And this is the financial ecosystem. The purpose of finance, if we think our banks, financial institutions, other financial intermediaries, is to take money from people who have extra savings and wanting to make that work for them. And as in, get a financial return and connect them. To people who need capital. So borrowers and investors, entrepreneurs. and that's the goal of the financial system. But often that system is not working in many countries around the world, or it's not working in certain communities. here in Australia, for example, that Islamic financial system is very limited. We only have a few products. There's yet to be, for example, Islamic insurance, so even business finance, there's very limited Islamic business finance except for when you're doing very large business operations. If you're a small tradie or you wanna run a cafe shop, there's actually no Islamic business loans that are available outside of very few limited offering. So, the vision for Wholesum is how do we provide empower for both sides? how do we do it in a halal way, and how do we do it in a way that's positive for the community, not supporting activities that are harmful? and ultimately, that creates an uplift for the entire community and for the general public as well.
Mifrah Mahroof:Yeah, what you were saying reminds me of this, statement I heard somewhere and they were saying every dollar that you spend builds the world that you wanna see. So there's a direct impact on, where we put our money and how that affects the world that we living
Dr. Tanvir Uddin:cause money can do positive things and it can do negative things. If we invest into, activities that create jobs, reduce environmental damage, empower communities, that's a positive thing. But also money can be used for harmful Things. there's a lot of debate at the moment around climate change and the need to direct funds to, away from fossil fuels and investment into fossil fuels that create accessible climate change. There's of course also the discussions and a lot of focus right now with some conflicts around the world, around investment into companies that promote and use weapons and particularly weapons exceeding destructive nature. That's all funded by capital, right? Because those companies need money and they go and produce factories, that produce weapons and there's investors behind them as well who are fueling that. So yeah, finance can be used for good and can be also used for harm and we need to try and promote more of the good.
Mifrah Mahroof:Yeah, one thing that I don't notice much is, a lot of conversations money, especially in the Muslim community.
Dr. Tanvir Uddin:Yeah.
Mifrah Mahroof:What are you though on that
Dr. Tanvir Uddin:Yeah. it's a really funny thing. generally money seems to be a bit of a taboo topic, or it seems it's not something,
Mifrah Mahroof:like you're the dunya or something. something
Dr. Tanvir Uddin:I've always been motivated by a lot of figures in the Islamic history. some of our scholars, Imam Abu Hanifa, for example, being a trader, Prophet SAW himself was a trader and I think the general gist from from their practices is that the dunya, you keep it in your hand and you use it. For good, but you don't bring it into the heart because you don't want it to, misdirect you. and to take you away from ultimately being the service of a Allah SWT and the Ummah. and you don't want that to corrupt you and make you greedy or becomes so stingy and miserly. So there's obviously at working out that balance, but there's no doubt that the dunya is very important'cause it's a time that we are here. and through that we can do a lot of good. So many people, if you think about the biggest philanthropists in the world, from the Bill Gates of the world to some of the most common donors within just our community here. They're using their wealth for a better cause. and I think that's very aspirational and something that we can all be inspired by. So in the community there's a general sort of, I guess maybe a spiritual conundrum around wealth and money. and then it's also oh, you talking about money, it seems okay. are you being greedy? Are you always about money when you talk about it? and that can creep up. Unfortunately, the sinister side of this, I mean, there's a lot of sinister sides to this, which I see. And it has real world impacts. So, for example, women, a lot of women, are in financially abusive relationships. There's a lot of research about this. There's a Bangladeshi researcher that I've been reading up recently who's been doing work about, women who've migrated from Bangladesh to Australia and the financially abusive relationships that they end up with. I volunteer with a charity called the Rise Foundation, and they provide. job readiness training, financial literacy training for women escaping, abusive, situations. that's one example of where it can be really sinister, and the lack of awareness and lack of financial independence is really having an impact, but a lot of young people are getting up into last year a lot of people lost money during the crypto, winter when it started. And that's because a lot of people didn't know about where to invest and how to invest. They Saw these tiktoks and these apps and people were investing in Bitcoin and supposedly making a lot of money. that's where it can be sinister as well. So we need to get to the forefront of this and understand it. And of course there's the halal education aspect as well. And how do we invest in Halal way, so that ties in as another layer to make it, perhaps even more complex, but also very important.
Mifrah Mahroof:Yeah, there are so many angles. Like you can look at when it comes to money, and especially attitudes in our community. Like for example, you actually mentioned the thing about women being in abusive situations and it's very common for me to hear things like, okay, women don't need finances they have their husband. And those kind of conversations, which is quite
Dr. Tanvir Uddin:I think, look, obviously a family unit is a team. and I think there's different types of layers of our social networks. We've got our immediate families, we've got our neighbors and our community where we live, and then as an Ummah we can think of a global community as well. There are important social obligations that are there at all levels, and a lot of them are mandated within Islamic law. And of course We are living in a country where we are very fortunate that there's great safety nets and public welfare as well. So not withstanding all of that, things do go wrong. Things people do fall through the cracks and I think it's an obligation upon us as individuals who look after the people that are around us, but also as a community to try and help people. Just at the very minimum, get educated and understand, what resources available and how they can become empowered. And then also creating the infrastructure to support who do fall through the cracks. And that can happen, it's not always the case that a husband is doing the right thing by their wife, or a family is doing the right thing by the people that are within their care, whether it be children and orphans. And we know a lot about the protection of orphans in the Islamic tradition and how Rosulullah SAW talked a lot. I mean, he himself was an orphan and advocated a lot for orphans. the bottom line is, I don't think we should take this for granted. and I tell this story a lot when I got married I asked my wife do you have any of your own wealth? not to take advantage of it or anything. I said, one of the things you need to do is put that aside, as your own little, wealth nest, and safety net for yourself. and build upon that for your own object, for your own goals. And obviously, that can be of benefit to the family, to the community, to your own pursuits. And the thing I got her to do, and she had no idea about this was, to put some of her money into a very long-term investments via Islamic ETFs. And these are very easy instruments to buy through brokerage accounts, and they're very low maintenance because once you purchase those ETFs, the idea is that they track the market. And we bought two particular ETFs for her, in her name and in her account. and they're tracking the market and doing really well and doesn't require a lot of effort. So these are small things like that, that I believe really is important. I did a similar thing for my mother-in-Law. my wife was telling me that my mother-in-Law, she works as a childcare, taking care of couple of children and she's accumulated a little bit of savings, which she's not really using, it's not part of her daily needs. And I said, yeah, same thing. Put her into an investment account. we set it up with an Islamic crowdfunding platform, based on it's offshore. and that's just providing a regular, double digit return for her. Through that process, and it's low touch. I really believe in that and I think empowering our community and giving people, particularly people who are otherwise a bit more vulnerable with options is key.
Mifrah Mahroof:Yeah, that makes a lot of sense. When you mentioned financial education like each person knowing like what they can do with their wealth, because I see that very commonly with women as well. we have our wealth and it just sits there and we don't really use it because I actually so I work in IT, so I have lots of male colleagues and would tell me about what they would do with their money and they're readily investing it and they're really making it work for them. But whereas when with my female friends, which, yeah, it's just sitting there and there's not really any understanding what to do with that money and even that term ETF, what is an ETF?
Dr. Tanvir Uddin:Yeah. So an ETF is stands for Exchange Traded Fund. I've just fallen into the common mistake, which is, of using all these jargon and terms, which is in the finance world. that's an example. I'm an example of the problem
Mifrah Mahroof:And the average person
Dr. Tanvir Uddin:so I'm an example of problem there. it's essentially, it's like purchasing a share, that you can purchase on any stock market or share trading or brokering account, but that particular share, it's like a unit in a fund that's managed by a fund manager. and they basically what they do with your money is they invest into many dozens, if not hundreds of companies. so it's like by buying that one unit in that one fund, I'm able to get exposure to many different companies. and it saves me the headache and hassle of having to purchase those individual company shares myself. I'm relying on and I'm taking advantage of the diversification opportunity again, which is means that they're able to invest into many companies and spread the risk, among that. And so we are working, so there's many Islamic fund managers that provide, Exchange Traded Funds or ETFs, there's now a few listed on the Australian Stock Exchange. There's been a few on the US markets, also in Europe. They're generally considered to be a very simple and effective way to invest. Obviously everyone should read the risk parameters and get their own financial advice, but for novice investors, it's a relatively easy of getting into the market, and in investing. Making those pieces of knowledge available. So people can learn about what other options out there, and then obviously they can go back and talk to their financial advisors and planners or reflect on it for themselves. And it's also just a basic concept to invest in the first place. Why should we even invest? what does investing mean in a person's broader financial decision? sort of matrix. they've gotta think about obviously how much, and it starts with things like budgeting and how much am I budgeting and how much am I saving? what are my goals? Goals for myself, my family, children, perhaps charities as well. What are my goals in the short term and the long term? And so these are sorts of conversations that are really important and we're often caught up in the day-to-day, and we don't think about it, but that's important.'Cause now inflation is really high, so if we are not putting our money away to productive use. If we're just sitting in a bank or just sitting there not doing anything, we are potentially losing value on our wealth. which can be a big problem because cost of living is rising around the world, particularly in Australia. We're feeling it, and we need to get ahead of that inflation problem. Otherwise, we'll have less and less money.
Mifrah Mahroof:Okay. So I want you to take me through this then. if someone were to be getting a paycheck, say they're getting like$5,000, right? And it comes in, what do they do with that wealth at that point? that down, for
Dr. Tanvir Uddin:there's many different, to answer that question, of course, we have to look at a whole range of different aspects of people's circumstances, but we talk generally.
Mifrah Mahroof:The average basic in person that
Dr. Tanvir Uddin:The first thing a common sort of hack that I've read about and seen in many, financial, budgeting resources. and of the financial gurus that I've read about, they talk about the 80 20 rule, which is, you should think about your money as being, you know that$5,000 like bing a pie, and if you think about it's five slices, one slice every month, you should look at a way to automate transfer into a savings and investment account. So you get your paycheck into your main account, and have that automatically transferred out. So from that$5,000, looking at roughly about a thousand dollars that you'll be putting into savings and investment, the other$4,000. You should have a very clear budget around what you can spend on. And of course, you've got your basics that you need. You might have rent, you'll have groceries, you've got, fuel and other transport costs. and putting aside then other budgets, things like, so you know exactly how much you're gonna spend on leisure that week. So don't go over that budget. how much you might put aside for donations and charities. And that's also a good practice to have, how much you might put aside for family and other incidentals. Maybe a bit of an emergency buffer as well. Something unforeseen might come up. family members drop by or, you might need to go and visit someone. You're gonna take a gift for them. All of that, within that$4,000. so it's very clear, and if there's any excess at the end of the month, you'll put that back into your savings as well. So let's say now that's the 4,000 done. You're left with that a thousand dollars without a thousand dollars. You'll put that towards an investment goal. Now, ideally, you'll put it, you would've already worked out your investment plan and savings goals ahead of time. And what that means is you look at your short term, your medium term, and your long term. So what I often tell people is that.
Mifrah Mahroof:Okay.
Dr. Tanvir Uddin:Your money. If you think about it as a stack of cash, almost visualize it, that stack of cash that you have, that's all your savings. The way you look at every dollar on that stack of cash is going to be different. Some of that stack of cash is, I need it for an upcoming expense, that's very in the foreseeable future, it could be big or small, but there'd be something that's coming up. Like for example, I might have a car insurance payment that I've gotta make. I've gotta do the rego on my car again, or I know that I have my quarterly electricity bill coming up. It's a typically a short term thing. It could be within three months to six months maybe. So I need to know what that is, and I need to plan for it beforehand so it doesn't surprise me. So I'm gonna put some money aside from now leading up to that. Right? And if it's gonna happen in three months, I might be saving a bit.
Mifrah Mahroof:Yeah.
Dr. Tanvir Uddin:Month by month or I might be using some of the money that I've already got saved. I'm gonna say, this is already earmarked. I've kept it aside. I'm not gonna do it for anything else'cause I've got something that's coming very quickly. So that's your short term. Then there's gonna be a part of your money stack, that is, for medium term purposes. So, for example, when my parents were planning for Hajj, they started putting some money aside and it was a three year kind of planning process.'cause, Hajj has become really expensive now. and they knew that money they needed to put it aside for Hajj and because. They really wanted to go to Hajj. They didn't wanna risk it by putting it towards anything else, and they actually didn't want to invest it anywhere. They put it, aside until they leave for Hajj. And then you've got like goals that might be three to five years. So, for example, a lot of people that I speak to, especially young people, they've really like to get into the property market, get their first home. so that's often a common thing. Some people wanna save for marriage, some people wanna save for a big trip. some people wanna save for starting a business. And so that money is not immediate. So it's not oh, I've gotta keep spend it like in the next year. But it's not so distant that you can forget about it either. So what if, for those kind of medium term plans, we often need to put it into some investments with a shorter term horizon, typically. Something that will have, it'll provide a return.'cause obviously you don't want to sitting around doing nothing.'cause again, we talked about inflation. you'd wanna have the ability to liquidate, which means pull your money out back from that investment into your own, accounts or savings or cash form, relatively quickly and easily. And you want to have, investment returns that are not too volatile because investments can be very volatile. And if it's gonna be down one year, you're gonna wanna hold onto it longer so that you can not only get back to positive, but you can make up for the period that you lost money. So you wanna think about those investments that fit that particular objective.
Mifrah Mahroof:what are some examples of that when you think about it? like examples that are, uh, compliant, like suitable for for our values and as being Muslims and stuff.'cause I know that there's products and things there, for the Muslims it's kind of hard
Dr. Tanvir Uddin:Absolutely. I guess it'd be helpful to go from that spectrum. So what are the very short term investment options all the way towards longer term investment options?
Mifrah Mahroof:Okay. let's hear it.
Dr. Tanvir Uddin:When you're looking at very short term, you are generally looking for, and I'll talk about what are the criteria that one looks for. So the criteria for short term is very liquid. You can pull it out quickly'cause you need it. It's not volatile. So very stable. The value's not gonna go up and down and you want it to be Very safe. So safe means from a finance perspective, either someone's provided a guarantee, and I'll talk about what that means or, the investments themselves of backed up by very strong security, very strong protections. So what guarantee means is that there is a protection, a legal protection, to maintain the value of that investment. There is only one Type of investment that's guaranteed. And that is a bank account up to$250,000. How is that guaranteed? It is guaranteed by the deposit insurance scheme, which is a government initiative backed up by ultimately taxpayers. So the government will step in if a bank, a licensed bank in Australia was to Go Cap puts, your savings in that bank account up to$250,000 is guaranteed. The government through taxpayer money will pay back up to 250,000. Now if you have more than that, it's not guaranteed. Now, there was a case, in Greece a couple of years ago during their financial crisis and some Australian Greeks lost a lot of money because those Greek banks weren't under, and they didn't have a lot of capital protection. So I think a lot of people think that, oh, my money in the bank is safe. Actually, your money in the bank is safe only up to$250,000.
Mifrah Mahroof:one. Yeah.
Dr. Tanvir Uddin:Now, generally speaking.
Mifrah Mahroof:amount.
Dr. Tanvir Uddin:There hasn't been a major bank collapse in decades, if not for over a hundred years. I'll just correct me on that one. and so banks are generally very safe, as place to keep your money. But here's the conundrum for Muslims. There are no Islamic banks. So there are no banks in Australia that provide a Halal investment return. And we are not meant to be, taking the interest as income. it's not permitted.
Mifrah Mahroof:Yeah, because you hear from a lot of financial
Dr. Tanvir Uddin:Yeah, so the problem we have as Muslims in Australia, and this needs to be solved, and obviously there are initiatives like the Islamic Bank of Australia that's trying to work to solve this problem. But currently, as of today, there are no halal Islamic bank investment options. So what's the next best option? The next best option is to put it into a few Islamic finance companies that offer, short term investment opportunities. What I mean by short term is you can put your money in and you can pull it out relatively quickly. You can't pull it out as quick as a bank. Like I can't pull it out tomorrow or tonight. But they'll have a usually a short window of up to 30 days. So I know Icfa, for example, has a 30 day callback. MCCA has a similar one. Now, the thing I wanna point out though is these are really the next best thing. They are not guaranteed. So there is risk and unfortunately without a bank, we can't have that capital guarantee. So that's on the short term. So short term companies like Icfa, MCCA, a couple of these players will provide a short term financing. Now, if you are willing to venture outside Australia, you could open up a savings bank account with Islamic banks globally. So some people are dual citizen. They have bank accounts in Bangladesh, Pakistan, UAE, Malaysia, other places, some Islamic banks might also allow international account holders. Again, you'll have to look it up and see the risks and parameters. Obviously, that then attracts new risks like currency risks. If I put my money in and the Australian dollar appreciates, then the value of that account will drop. So again, you'll have to look into those factors. Then moving along the spectrum a bit now towards medium term investments, of course you've got short-term investment funds. Hijaz has one. and, uh, Icfa, MCC also have short-term income funds, which you can invest into. These are managed funds and they're licensed under Australian, ASIC regulations as money managed investment schemes. These are not eTFs. these are just managed fund. What that means is they're essentially pulling. So wholesome, my company's also a managed fund. We bring people put their money in, like they pull it together into a fund. And the fund issues units to different investors based on how much they've put money in. So someone's put in, a thousand dollars,$10,000 of them will have. Units representing the number of amount of money that money comes in, and the fund manager's responsibility is to invest it according to the investment mandate. So whenever a person joins a managed fund, they sign a contract. And that contract is usually, if it's a retail investment fund, it's called a product disclosure statement. If it's a wholesum investment fund, which is like us, it's called an information memorandum. I always advise people that make sure you read that and understand that because it'll outline very important. Points, what are the fees, what are the risks? what are they investing in? and how is that working? a lot of people are surprised by some of these things.'cause they think they're getting into something and they don't really know. And later on they get stung by fees or they get stung by saying, oh, I thought that the investment fund was doing this, but actually it's doing something else. So it's important to read up and understand those and speak to someone. if you don't understand the documents, speak to someone who can help you, read them. So in the medium term horizon, there's a lot of investment funds, ourselves, hijaz, a couple of other players do that. and again, you need to look at, read, each fund will have a different parameter, right? So some of them are more towards short term, some are more towards longer term. and the longer term and short term will often be determined by what they're investing into. So if a managed fund is investing into, equities or shares in companies. Typically you are looking at a longer term horizon, like maybe three, if not especially five plus years, because stock market prices are gonna go up and down. They'll be up of one month. They might be down the next month.
Mifrah Mahroof:Three to years
Dr. Tanvir Uddin:that's generally considered medium. I'll get to the really longer term in a moment. now again, it'll depend on the nature of the companies as well. If you're gonna invest into primarily, what they call blue chip stocks. So blue chip stocks are the largest, most profitable, the most successful companies, in Australia. There might be BHP bulletin. they might be, for example, pharmacy chains or hospital groups, like Ramsey. Or they might be, Telstra. As a telco, these are very solid companies. They are very profitable, so they are fairly, they're relatively safe, in the medium term. Now, if you're gonna invest into companies that are small, they're growing, they're more risky. and so the return that you might realize on them in the short term, it might be quite, it could even be negative, but then you are thinking, okay, if I hold onto that company in the long term. They're gonna turn a profit and I'm gonna be okay. So again, you're gonna have to read into the details of who those managed funds are investing into to appreciate the risk reward parameters particularly for you. And that will also determine how long or short term you can hold it. So you've got managed funds and the instruments in the short term. Then moving along, If we look at the longer term, so let's say 5, 6, 7 plus years beyond that, you're looking at the space of venture capital funds, you're looking at the space of property investment funds, and you're looking into the space of more sort of, You like more volatile, more risky assets, including, for example, startups, small cap companies. so companies that are very small, they are really going for moonshots or they're going for a very long term strategy. there's no easy pathway for them in the short term. So for example,
Mifrah Mahroof:Yeah.
Dr. Tanvir Uddin:A lot of startups are like that, they might not make any money for seven to 10 years, but they're growing, building a product, iterating, and So you've gotta really hold out your money for a long term before you make a profit. But also it's also not liquid. What that means is I can't just quickly pull my money out tomorrow. Why? Because startups, and particularly venture capital funds, they invest in startups. Those startups are taking money and they're investing into the product. They're not ready to pay a dividend. Definitely. And the only way you can make money from'em is when that company might list on the stock market. So either, otherwise known as the initial price offering or IPO, you hear that a lot. or the company gets bought out by another company and when they buy it out, they pay out all the shareholders, which includes yourself. You might be an investor in them, so they're not very liquid. Property is also not liquid because you gotta sell the property to get the money out. And that you gotta, and knowing the property cycle a bit tricky. It might be a five, seven year cycle. so investing requires one to match up. the time horizon with the risk and the liquidity situation and ultimately your objectives. I've just given a flavor of a few investment options. There are obviously a lot more out there. But of course there is a general challenge for Muslim investors in Australia. There really isn't a lot of the instruments and options that are available to the general public are not as much available Muslims, because they're just not as many Islamic, funds or Islamic entrepreneurs. What we really need is more entrepreneurs to get out there and create products, we need to create new investment vehicles. A part of wholesum's vision is we wanna, started with investment management because what we wanted to do was start with funds management, to get capital in and through that we can start innovating with new products and services. I mentioned that we don't have a lot of Islamic financing products, personal loans, car loans, business loans, and all sorts of other products like that and insurance. So what we wanted to do was to try and start to build that bridge to create more products in the community so that we can help more people
Mifrah Mahroof:All right, So one of the things that I wanted to ask you, so we actually spoke about different types of investing and I also wanted to get around, get on the topic of crypto actually, because it's something that a lot of people speak about as an investment and want to know what your thoughts are on this.
Dr. Tanvir Uddin:Yeah, sure. So
tanvir--dr-_3_02-19-2024_091413:I mean,
Dr. Tanvir Uddin:cryptocurrency investments has become a completely new type of asset class that just didn't exist five, 10 years ago and became really popularized with a number of exchanges. I think there's two things to note about crypto. One is that there are, like, the underlying technology is quite fascinating and if you think about the blockchain and what it's enabling and how it makes the speed of transfers and the ease of converting into digital assets and back is quite remarkable. There are some use cases in certain countries. There are it is probably one of the most legitimate and easily accessible ways to invest and save you money, but also transfer. If you think about in countries where the financial system isn't as robust or it's not as easy to invest into other assets, especially if you have a small amount of money and you're in remote locations. My sort of, take on crypto investing, particularly where there are real assets and it's a lot easier to access. And what I mean by real assets are you can take small amounts of investments in property or stock market or ETFs or put it into funds when you have those accessible options out there, it is really important to diversify and what's happened for a lot of Muslims. Where they aren't aware about alternative investments or they they don't have a lot of money to invest in. There was a huge allocation from a lot of, especially a lot of millennials into crypto over the last couple of years, particularly just before the crypto winter where, and what's called the crypto is basically where the prices or value of major cryptocurrencies dropped dramatically. So a lot of people lost money, so I think that's for one thing to be very careful about. But for me, there's another really practical reason, and I guess this is why when I've set up my fund and the philosophy behind our fund is we wanted to invest into assets. Particularly investing into small and medium businesses and microfinance because they have a direct tangible benefit in society. They're creating jobs, they're helping reduce inequality when you're investing into crypto. Whilst it's a legitimate asset, it's not clear where the proceeds are directly having a positive benefit. And that to me is why personally I don't invest in crypto. Because I'd rather have my investments do something positive and have a direct impact. So I think it's something to think about that, it's not just always about the seeing the dollar signs and making a lot of money. As Muslims, we should be very holistic in how we approach things just as we care about the animals that we slaughter for meat consumption. Just as we think about the ethics of dealing with people and how we treat them, it's not just about a transactional relationship. We should approach our money and how we make money where we invest money in a holistic framework. And, the Quran talks about Thayyib and being wholesum with not just halal, but wholesum and also like being wholesum in a very holistic sense and a very broad societal sense.
Mifrah Mahroof:Yeah, that's a fair point when you look at it that way, because I guess when people look at crypto or what's talked about around crypto, it's okay, you can make the most money out of it or something, although that's very subjective. But I guess coming back to our Islamic principles, which is the most important thing, is actually seeing what is that money going to be doing to our world? How is that gonna improve our world? And I see where your coming from. So ideally we should be thinking about ways on how we can grow our wealth, but also grow the world as well, because that's our responsibility as caretakers of the world. And very important point that you brought up. Okay. Now since you spoke about those different asset classes, crypto, now I wanna know go back a bit on earlier when you spoke about asset allocation and what would a person do practically when they actually get their job salary, and what do you actually do with that? Do you need to actually sit down and write down a budget and write down what your expenses are and then try to stick to it or is there like a percentage or what are your thoughts on that?
Dr. Tanvir Uddin:Yeah, no, sure. I'll share some practical points. It is really important to have a very good understanding of basically what's called cash inflows, which is money coming in to a person's account or their household. Rather, we often as Muslims, we live in families typically. And we need to consider about the family responsibility, whether it be, adults and children, grandparents. So cash inflows coming in and also cash outflows, which are where the money is being allocated and spent to. And one of the things there's two kind of concepts that I always think a lot about and I talk to people about. One is, The prophet's cousin he not only do we know him as a deeply spiritual person, a military leader, a political leader, but he also was known to be a successful financial planner and someone who organized wealth and managed that really well. There's a particular saying that's often attributed to him, which is that he used to say that you should prepare like you could die at any time. And that's coming from that spiritual perspective that, death can be as
Mifrah Mahroof:So your finances, you
Dr. Tanvir Uddin:no. As in prepare for death because we could leave the world at any time. So we should always try and be good and we should try and be prepared that our balance of good deeds is outweighing our bad deeds. But he said in terms of when you're living the world and you're managing your finances and you're managing your responsibility to society. Imagine like you're gonna live forever. And what that means is, and what people interpret it as is that, we need our resources to last for us. We don't wanna become dependent in society. We don't wanna be in an old age where we like begging people for resources and money. We should think okay, if I'm gonna live forever in a sort metaphoric sense what am I doing? I'm producing, I'm being productive and I'm being useful to society. I'm not becoming a burden in that sense. And so that comes down to financial planning and how we think about allocating our resources today, so that it can last in the future. How are we earning money today so that we have enough to invest and save for the future? So that's one thing. The other thing is Rosulullah SAW used to make a lot of dua around debt and, there's so many Hadith talking about debt. Particularly there was a case where someone. had a debt and he was hesitating to pray the Jenazah over that person to someone that person's debt. And that's because debt is a burden. It's a burden on a person, but also can cause rifts between people and between societies. So if we weigh those two kind of concepts up I'll talk about some principles from budget. So let's say I've got$5,000 20% of that, or$1,000. I should immediately from my pay packet, I should think about, okay, I'm gonna put this aside for savings and that's going to be money that I'm gonna put aside for the future. I might invest it, I might just leave it into account because I might have an expense coming up in the future. So I'm already starting to think about my future planning, right? So 20% there, then the bulk of our expenses should be for the most essentials, we need to make sure our essentials taken care of. If we don't take care of our essentials and we start spending on things that are less essential then we're not taking care of the most important things, whether it be our families, our basic sort of living items like shelter and food and clothing. So probably 40% would be allocated to that then another 20%. And is to help us pay off any its existing obligations and they might be debts that we have incurred. And again, coming back to that principle, the Prophet SAW was really cautious about debt. It's not forbidden to take debt, but. If we want to follow that guidance, we wanna try and minimize our debt. And for a lot of people there might be debts associated with student debt. People might have taken out credit cards, this'cause they were trying to pay for something that became unexpected or there might be other types of, debt relationships that one has entered into, whether it be a home finance or a car finance. So that would be another 20%. And then the final 20% are for things that are short term in nature. They might be a bit of leisure. They might be for those additional things that pop up every now and then. You've got family visiting, you might want to go visit someone and buy them gifts. You might go take your family out every now and then to eat out for a coffee. So for those sort of discretionary and less essential items. So that's roughly a framework that one can apply. Obviously circumstances will change and everyone's situations a little bit different, but at least getting to the mindset of every time. Setting up budget at the beginning of the year particularly.'cause you'll know things like, okay, what my income's gonna be for the year. And you can obviously tweak it across the way, but setting that up and monitoring and adjusting as you go along. Am I spending too much? Am I spending too less? What's going on? Can I invest more? How's my investment performance going? Can I perhaps. Allocate a bit more in the next couple of months to take advantage of this current investment opportunity. Then maybe in the next few months, I'll just dial it back. So it's just having a very practical and pragmatic way of monitoring ourselves on a regular basis. And just keeping ourselves accountable. At the end of the day, it's just about accountability. What we don't wanna be is hedonistic, that's the crux of what Rosulullah SAW and Ali r.a. is messages. We don't wanna treat our wealth like. You know, it'sothing that we take it for granted. We wanna be proactive, and that proactivity comes back from a very spiritual perspective because we want to be grateful for Allah SWT's given us, and we want to be responsible towards our families and our society, and that requires us to be on top of it.
Mifrah Mahroof:Yeah, that's true when you actually put the spiritual frameworks in it, like thinking that, okay, if we can die any moment, I should do the right things with my wealth, be ethical and all those principles, and then think long term so that we don't become a burden on our societies or we don't, we live such a hard life when we, retire and that income goes away or anything. And it's really sad to see when you see people who have retired and they didn't think about their long-term finances when they were younger. And now they're really at the mercy of their children or society if they don't have any children or even if they did have children and the children didn't want help or things like that. And it's one it's very sad to see,
Dr. Tanvir Uddin:It is
Mifrah Mahroof:All right, so we're actually nearing the end of the interview and very, a lot of interesting points that we covered on. Now I actually want to know about your life hack actually. So what's actually one life hack that has helped you improve your life, whether that be in finances or just your life in general?
Dr. Tanvir Uddin:I think that one particular thing when I've been on top of this particular activity I've really reaped the benefits and when I haven't, everything else seems to have started to fall apart a little bit or not have not as been as great. And that is A regular physical exercise or activity regimen. The thing that I started picking up doing when I moved back to Australia from Saudi Arabia was running whatever your activity might be, whether it's running, whether it's gardening, whether you do a lot of walking. But it's really, I think that physical exercise and having a regularity to it is so key. What I found that was beneficial was when I started running, I not only started to, fix my weight and my sort of, even in terms of just moving the body, getting the heart flow going. But I started to see a lot of really great benefits for everything else. My, my mental health was a lot better. I had more sort of optimism and more energy to do other things. And likewise when I've dropped it, so there's in periods where I'm running really well. Then I get a little bit sick and I'm out of that habit. Then I start feeling sluggish. I start feeling stressed. Anything starts to irritate me. And I'm like, okay, this is a thing that's dropped. I need to get back onto it. And one, I've realized was that it just started helping give me a good structure to my day. So for example, if I'm going to be traveling out to work somewhere. I would usually run in the morning feel really good, and then I'll do my day or I would do like a solid stint of work in the morning and take a break at lunch to go for a run, come back, energize, continue the day. So it just sets a really good regime. and, you feel a lot good about yourself as well. Especially even with finances, like one of the things is about momentum and what you wanna do is just keep at the momentum. It's not about, like for running. It's not like I've gotta be a under two hours, under three hours marathon runner, but it's just that small steps, that regular steps. And coming back to Rosulullah SAW advice about taking the moderate path and being very consistent. So that's something a hack that I find a lot of benefit and a lot of other people that I admire, people who seem to be doing really well with their finances or with their careers. I find that's one of the most common threads. They have a regular exercise regime. that's something that yeah, I, I'll definitely encourage.
Mifrah Mahroof:Yeah, I guess it just really comes down to when you fulfill the rights of your body and then your body can perform at its peak and you can be able to use that'cause in order to take care of finances, it requires a lot of thinking and brain power. So you need that and I guess like you said about physical exercise and finances, it really comes down to just maintaining. I think a lot of things in life is just about showing up continuously
Dr. Tanvir Uddin:That's it.
Mifrah Mahroof:sometime it can be boring, but sometime it can be very energizing and it's just really going through the waves that, it comes up and down really.
Dr. Tanvir Uddin:That's it. Yeah.
Mifrah Mahroof:Awesome. Okay. And what's one book that's helped you level up in your life?
Dr. Tanvir Uddin:Ah, okay. I think the one book that I've benefited a lot from and it carries on with this theme of I guess community connection and mental health is a book called The Lost Connections. And the book, essentially the author suffered from a lot of depression and anxiety for many years, and he traveled the world to try and understand why is it that we've got more sort of experts, more drugs, more research and yet we are not really, solving this epidemic of depression and anxiety around the world. And it's growing rapidly everywhere, especially in a lot of advanced countries associated with loneliness. And he found that those sort of six lost connections. I won't spoil them for everyone. I really encourage you to check that book out. And maybe before can put it in the show notes. there's a couple that I'll just talk about, and it's actually, I'll just talk about one, the first one, which I think for me resonated and I think a lot of people from faith-based communities or people who have an active participation even in this very small way. And that is the first connection he talks about that's been lost is purpose. As Muslims, we know from the Quran that we are not created without purpose, and the Quran actually talks about three types of purposes, right? One is, of course, Ibadah and worshiping Allah SWT, but another one is to be his representative. And third one is about being stewards and caretakers of the earth. in those dimensions. I think cover many different aspects and many different walks of life. Some people's purpose is taking care of someone. Some people's purpose is to serve the community. Some people's purpose is to lead. Some people's purpose is to educate, So everyone's got a purpose
Mifrah Mahroof:the difference between the sorry, the representative and the caretaker?
Dr. Tanvir Uddin:Yeah the so the two different verses in the Quran one talks about Khilafah, which is about vice Jarncy, and the other one is about stewardship. So one of our purposes is to represent alone earth. And that means to represent his values his his commandments and uphold that. And that's a separate one to being a caretaker of the earth that we've been sent here for a period of time. We take care of the earth. This the three purposes are really well explained in is a talk at the Festival of Faith by Hamza Yusef. I found that particular talk very fascinating as well and very beneficial. But yeah, If we think of purpose in a very broad sense and really reconnecting to purpose. We will find that we take every single moment with a gravity that it deserves that, every breath, every moment, every day. We can just do that and we can feel that we are part of a bigger thing. And I think when I go through some of the most difficult periods in my life and a lot of other people that I speak to, it's that purpose to family, to their own mission. To society that's really helped them go through it a lot. And the author talks a lot about that. That first connection, I think is something we can all connect to. I've used the word connect to us, but we can all take, I guess, as Muslims and trying to get through all the noise around the world that is out there. And sometimes it can be very gloomy. But Rosulullah SAW is someone who lived a life of purpose and he advocated for that. And I think that if we wanna lead a life of per purpose, we take every moment, we take care of our health, and we take care of our finances. These, it naturally flows on from that.
Mifrah Mahroof:Yeah. And we're very blessed that we actually know our purpose through our religion. I guess it's like when we don't have that, it's the mainstream things in personal development. It's oh, go find your purpose and this and that, and you just go all over the place and you're constantly in pursuit of that and Alhamdulillah, we have this in our deen and broken down the frameworks there and it's just up to us to really use that and help us find how it is for us, Alhamdulillah. It's been an absolute pleasure having you on the show, Tanvir. Thank you so much.
Dr. Tanvir Uddin:Thank you so much, Mifrah. It's been a real pleasure speaking to you and you asked some great questions. I hope it's of benefit to everyone. In shaa Allah
Mifrah Mahroof:Hey everyone, that wraps up another episode of the Muslim Life Hackers podcast. I really hope you enjoyed our chat today and got some great takeaways from it. If you like what you heard and don't want to miss out on our next conversations, hit that subscribe button. It really means a lot to us and helps us grow the show. And you know what? If you're feeling extra generous today, drop us a review or a rating. I'd love to hear your thoughts. Thank you again for tuning in until next time, keep striving and getting better every day.
