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Earning Interest To Cover For Inflation
Assalam o Alaekum
Thank you for creating this app to allow people like us to have a platform where we can ask questions.
I wanted to get clarification regarding my savings. In the past few years we have seen tremendous growth in inflation rate. Every year the amount that we have saved is lessened by its ability to buy things.
To protect my savings from further devaluation I was thinking of putting it in a savings account where I can get interest and reduce the devaluation. Since the interest is always going to be less than the inflation rate, my mind or the shaitan is telling me that its okay. Moreover the amount saved by me is already being used by the bank to earn interest by lending it in the form of loans or financing. Since the bank is already earning from my money why cant I use that to safeguard my savings against inflation?
I have seen a lot of videos by Ghamidi center of islamic teachings on Interest but I wasn’t able to convince myself in one direction or the other.
I would really appreciate if you could remove my confusion and point me in the right direction. I would really appreciate a detailed explanation of your answer.
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1 Reply
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Earning Interest To Cover For Inflation
updated 1 year, 3 months ago
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While the interest earned from an interest bearing bank account cannot be considered as riba within itself, it is generally still paid to the account holders from the riba received by the banks. It is therefore recommended that one should refrain from taking this money if at all possible. There are several ways to protect the buying power of one’s money against inflation, for example, investing it in commodities, real estate, etc. If possible, these methods should be employed instead of taking interest from banks.
For comments of Ghamidi sahab in this regard, please watch:
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