Saving Gold: Between Shariah and Profit

Do you find yourself overwhelmed by thoughts about the future? Unsure how to shield yourself from life’s unpredictable turns? Are you torn between adhering to the principles of Shariah and finding proper ways to save? Do you fear trading your religion for worldly gains?

We are often consumed by dozens of questions about saving, investing, and safeguarding against future uncertainties—especially with the growing number of crises and trials in our modern age. This has led people to search for the most suitable investment paths—those farthest from suspicion and in full harmony with Islamic Shariah, which lays out a dignified and modest way of life. It commands work, effort, and striving, emphasizing that the upper hand that gives is better than the lower hand that asks, as the Prophet ﷺ said: “The upper hand is better than the lower one.” Islam holds work in high regard and considers one who strives to support himself and his family as being like a warrior in the path of Allah. Islam encourages saving and prudent financial planning, seeing it as a matter of foresight, balance, and self-preservation—not of miserliness or greed. The Muslim is called to maintain a balance between spending and restraint, managing wealth with sound judgment and long-term vision.

The Prophet of Allah, Yusuf (Joseph), peace be upon him, embodied the concept of saving, caution, and future-oriented thinking. He said: “You will plant for seven years consecutively; and what you harvest leave in its spikes, except a little from which you will eat.” (Yusuf: 47). Then he said to the king of Egypt: “Appoint me over the storehouses of the land. Indeed, I will be a knowing guardian.” (Yusuf: 55). This was a model of saving and wise management that safeguarded people’s sustenance and protected them during times of hardship. Gold has long stood as one of the most suitable saving methods across eras due to its stable value and ease of storage and exchange. Shariah has permitted saving and owning gold within the boundaries it sets, aiming to achieve a balance between earning and spending, and between saving and generosity—ultimately to ensure the individual’s financial security and the community’s economic stability.

Saving in Gold: A Source of Security and Wealth

In a world filled with tensions, unrest, and economic and political crises—where currencies lose value, oil prices fluctuate, and stock markets waver—gold remains the safe haven that wealth turns to. It has even been dubbed the “global currency of trust.” According to the 2024 report by the World Gold Council, total global demand for gold reached approximately 4,448 tons, accompanied by a sharp rise in investment demand, particularly by central banks, which purchased over 1,037 tons during the year. These figures reflect how decision-makers and monetary policy leaders view gold as a vital tool for economic protection.

Gold Saving in Arab and Islamic Countries

On the individual level, gold markets in Arab and Islamic countries have witnessed a significant rise in the purchase of gold bars and coins—especially with the increasing political crises and the devaluation of local currencies. According to 2024 data from the World Gold Council on gold reserves in Arab countries, Saudi Arabia holds 323 tons of gold, followed by Lebanon with 286 tons, Algeria with 173 tons, Iraq with 162 tons, Libya with 146 tons, Egypt with 126 tons, Qatar with 110 tons, and Kuwait with 79 tons. These figures reflect the trust that Arab and Islamic nations place in gold as a means to protect their economies from inflation and currency volatility.

Gold Saving in Islamic Shariah

Gold in Islam has never been merely a commodity for trade—it was a legitimate currency used by Muslims throughout centuries due to its stable value over time, its natural rarity that resists inflation, global recognition, and compatibility with Islamic Shariah in ensuring fairness and preventing injustice in valuation. These characteristics have led many Islamic economists to call for the revival of the gold dinar and silver dirham, or to tie paper currencies to gold reserves in order to reduce dependence on the interest-based monetary system rooted in inflation and debt.

Zakat on Gold

Islamic Shariah mandates zakat (almsgiving) on gold once it reaches the nisab (minimum amount) and a full lunar year passes over it. The nisab is approximately 85 grams of pure gold (24 karat). The Prophet ﷺ said: “When you possess two hundred Dirhams at the end of the year (if you still have all of them), five Dirhams are levied on them as Zakah. There is nothing upon you (to be paid) in gold, until it reaches (the value of) twenty Dinars. When you possess twenty Dinars, at the end of the year, then there is half a Dinar levied on it (as Zakah). Any additional amount will be calculated in the same manner. No Zakah is to be paid on monetary holdings, until they have been owned for one year.”

Zakat purifies and blesses wealth, as the Prophet ﷺ said: “The wealth of a man will not diminish by Sadaqah (charity).” It also prevents the hoarding of gold and keeps it in circulation by redirecting it to zakat recipients. If gold is owned solely for adornment and not for saving, it is exempt from zakat according to the majority of scholars. Gold is among the commodities that must be exchanged with immediate hand-to-hand transfer; thus, delayed payment or online purchases without immediate receipt are impermissible, as they fall under riba (usury).

An Islamic and Economic Perspective on Gold Saving

Many people have become accustomed to saving in gold to preserve their money’s value and protect it from inflation—something permissible in Shariah so long as it does not involve riba, prohibited trade, or market monopolies. Gold has become a safe haven amid fluctuating paper currencies and escalating political risks. This was demonstrated during multiple crises, such as the COVID-19 pandemic, the Russia-Ukraine conflict, and recent tensions in U.S.–China relations, where gold prices surged as markets collapsed—proving it to be a strategic option for individual and societal financial stability.

The Role of Gold Saving in Building a Stable Islamic Economy for Individuals

Gold enables Muslims to save for the long term without the risk of inflation or currency collapse—unlike current paper currencies that lose value over time. Gold is renowned for preserving purchasing power, offering individuals a reliable way to store savings and shield themselves and their families from price hikes and market volatility. It ensures financial independence and self-reliance. Furthermore, gold doesn’t require large capital to start saving—anyone can begin with what suits their means and gradually increase over time.

The Role of Gold Saving in Building a Stable Islamic Economy for Society

The importance of gold extends beyond individuals to encompass the entire Muslim society. If gold is used in transactions or if economies are tied to its value, it would curb the printing of money without real backing—which is a major cause of inflation. It would eliminate interest-based debt systems and the injustices arising from the collapse of the purchasing power of weaker social classes. Zakat on gold contributes to the redistribution of wealth among rightful recipients, ensuring that gold circulates among people rather than being hoarded. As Allah says: “And those who hoard gold and silver and spend it not in the way of Allah—give them tidings of a painful punishment.” (At-Tawbah: 34). In this way, a balance is achieved between individual and society, and between saving and social responsibility.

Buying and Selling Gold: When and How?

Many gold experts respond to this question by stating that the best time to buy gold is when a person has surplus money beyond their immediate needs. Gold is the most suitable means of preserving the value of that money. There is no need to wait for price reductions or to save up a larger amount to purchase more; likewise, there is no need to sell gold unless there is a need for capital—even if prices rise unexpectedly. The real value of gold does not lie in selling it for more than it was purchased, but rather in its ability to preserve the value of money and be relied upon in times of need, restoring one’s real wealth away from risks and inflation.

In conclusion, gold in Islamic thought is not merely a precious metal, but an economic tool based on stability and justice. It serves purposes such as saving, investing, and preserving wealth value—within the framework of Shariah rulings that protect it from injustice and usury, and that establish balance between the individual and society.

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