How to Invest as a Canadian Muslim

Investing as a Muslim in Canada can feel overwhelming—But it doesn’t have to be

If you’ve ever tried to start investing in Canada as a Muslim, you’ve probably run into one (or all) of these struggles:

❌ Most investment options include haram income (like interest or unethical industries).
❌ You’re unsure where to start or what accounts you should be using.
❌ You want to invest, but you don’t have time to research every stock and ETF to check if it’s halal.

I get it.

Between navigating Islamic finance guidelines, avoiding interest (riba), and making sure your investments align with your values, it can feel easier to just keep your money in a savings account and call it a day.

But here’s the problem:

📌 Saving alone won’t build wealth. Inflation is eating away at your money every year.
📌 Investing is necessary to grow your wealth. But it must be done in a way that’s halal and sustainable.

The good news? You don’t have to figure this out alone.

Today, I’m going to break down exactly how to invest as a Canadian Muslim—step by step.

And if you want a done-for-you, halal investment solution, I’ll share how we can manage your investments for you, so you can grow your wealth stress-free.

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1. Step One: Understand the Basics of Halal Investing

Before we dive into how to invest, let’s clarify what makes an investment halal vs. haram.

📌 Halal Investments Must Follow These Guidelines:

✅ No interest (riba). This means avoiding bonds, GICs, and traditional savings accounts that generate interest.

✅ No haram industries. Stocks and funds must avoid sectors like alcohol, gambling, adult entertainment, weapons, and non-halal food industries.

✅ Ethical business practices. Companies should follow Shariah-compliant financial structures (e.g., low-interest debt ratios).

✅ Annual purification. Any haram income (like small interest payments received from stocks) must be calculated and given to charity.

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📌 Common Investment Products in Canada That Are NOT Halal:

🚫 Bonds & GICs – These rely on fixed interest (riba).
🚫 Traditional Mutual Funds – Many contain non-halal stocks or high-interest debt.
🚫 Index Funds (Like the S&P 500) – While diversified, they include haram industries.

This is why most mainstream investment options aren’t suitable for Muslim investors.

So, what’s the alternative?

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2. Step Two: Choose the Right Investment Accounts in Canada

In Canada, where you invest is just as important as what you invest in.

There are three main types of investment accounts that offer tax advantages:

📌 Registered Retirement Savings Plan (RRSP)

✔️ Best for: Long-term retirement savings
✔️ Tax benefit: Contributions are tax-deductible, and investments grow tax-free until withdrawal.
✔️ Ideal if: You have a high income and want to lower your taxes now.

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📌 Tax-Free Savings Account (TFSA)

✔️ Best for: General investing (retirement, wealth-building, big purchases)
✔️ Tax benefit: No tax on growth, withdrawals, or gains.
✔️ Ideal if: You want flexibility and don’t want to pay tax on investment profits.

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📌 Registered Education Savings Plan (RESP)

✔️ Best for: Saving for your children’s education
✔️ Tax benefit: The government matches 20% of your contributions up to a certain limit.
✔️ Ideal if: You have kids and want to invest for their future education.

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📌 Other Investment Accounts:

If you’ve maxed out your RRSP and TFSA, you can also invest in a non-registered brokerage account.

➡️ Action Step: Choose the right investment account(s) based on your goals.

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3. Step Three: Pick Halal Investments

Now that you know where to invest, let’s talk about what to invest in.

There are three main ways to invest in a halal portfolio:

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Option 1: Invest in Individual Halal Stocks

✅ Pros: Full control over stock choices, potential for high returns.
❌ Cons: Requires a lot of research to screen for compliance and financial health.

If you choose this route, you’ll need to:
✔️ Screen stocks for halal compliance (avoid companies with haram income).
✔️ Diversify to manage risk.
✔️ Monitor your portfolio regularly.

This is a great option if you have the time and knowledge to research every stock you invest in.

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Option 2: Invest in Halal ETFs & Mutual Funds

✅ Pros: Less risk and easier diversification.
❌ Cons: Limited halal options in Canada.

Some halal ETFs & funds include:
✔️ Wealthsimple Shariah-Compliant ETF (WSHR & HLAL)
✔️ Manulife Shariah Global Equity Fund
✔️ Wahed Invest (Halal robo-advisor)

This is a simpler way to invest while keeping your portfolio halal.

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Option 3: Let a Halal Investment Professional Manage Your Portfolio

✅ Pros: No research or management needed, fully Shariah-compliant.
❌ Cons: Small fees apply for portfolio management.

If you don’t have time to research halal stocks or manage your own investments, we can do it for you.

With our partner’s managed halal investing service, we:
✔️ Screen investments for Shariah compliance.
✔️ Create a diversified, halal investment portfolio tailored to your goals.
✔️ Handle all the buying, selling, and zakat purification calculations for you.

This means you can grow your wealth without worrying about haram investments or market complexities.

📌 Want us to build and manage your halal investment portfolio for you?

Click here to learn more

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4. Step Four: Start Investing Consistently

💡 The key to building wealth isn’t timing the market—it’s time IN the market.

Here’s how to start:
📌 Set up automatic monthly investments so you don’t have to think about it.
📌 Stick to your plan, even during market dips—investing is a long-term game.
📌 Work with a halal investment professional if you want a hands-off approach.

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5. Want a stress-free way to invest Halal? Let us manage it for you.

I know that figuring out where and how to invest halal in Canada can feel overwhelming.

That’s why along with our partners OneVest and Manzil, we offer a fully-managed halal investment service—so you can grow your wealth with confidence, knowing your investments align with your faith.

✔️ We research and select halal investments for you.
✔️ We handle all portfolio management, so you don’t have to.
✔️ We take care of zakat calculations on your investments.

📌 Want to start investing stress-free?

Book a call and learn more here

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The Best Time to Start is Now

If you’ve been waiting for the “perfect time” to start investing—this is it.

The earlier you start, the more time your money has to grow.

💬 Tell me in the comments: Have you started investing yet? If not, what’s holding you back? Let’s talk about it!

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