Don't Invest Until You've Done These 6 Things

Assalamu Alaikum girlie! 🌸

So, I always talk about how great investing is and the importance of starting early. This is true but given that investing is a long game, you need to have a solid financial foundation.

Imagine building a beautiful, tall house on shaky ground. Without a solid base, even the best-built structure can come crashing down. Investing is similar—it’s powerful, but only when you’re truly prepared for it. 🏡

Today, we’ll cover 6 things you need to do before you start investing!

Let’s take it step by step!

6 Things To Do Before You Start Investing

1. Build Your Emergency Fund First 🕊️
Imagine this: you’ve started investing, things are going great, and then—boom—an unexpected expense pops up. Maybe it’s a car repair, a medical bill, or a sudden travel need.

If you don’t have an emergency fund, your only options might be dipping into your investments (ouch😣) or taking on debt (double ouch😬). And here’s the kicker: if you have to pull from a retirement account, you’re hit with penalties, taxes, and possibly withdrawing during a down market. Yikes!😖

How to Avoid this: An emergency fund of 3-6 months of expenses is there to catch you when life throws a curveball. Start small if you need to—just $1,000 can make a difference. Set up an automatic transfer each month to build it up. Your future self will thank you Inshaa Allah!

2. Tackle Debt with Intention 🚫💸
Debt can feel like a heavy weight, and the cost of carrying it is more than just financial—it’s emotional too. High-interest debt can eat away at your hard-earned money, leaving less for building real wealth. And if there’s interest involved? As Muslims, we know that should be avoided.

Plus, there’s the opportunity cost—the longer your money goes toward debt, the longer you miss out on growth through investing.

Why This Matters: Paying off debt before investing frees you to focus fully on building wealth, without feeling like your investments are weighed down. Every debt you pay off is one step closer to financial freedom and investing with a clean slate. 🎉

3. Keep Learning and Stay Informed 📚
Investing can be like navigating a new city—you wouldn’t go without a map, right? Educating yourself helps you make informed choices, avoid rookie mistakes, and save on unnecessary fees or losses. Ignorance in investing can be costly, from missing out on good opportunities to choosing high-fee investments or even incurring tax penalties. Knowledge is key.

Why This Matters: The cost of ignorance is real—lost growth, unnecessary expenses, and potentially bad investment choices. Make it a habit to learn something new regularly. Join me in on December 15th in Raleigh for a Muslimah’s Guide to Halal Investing Workshop. [Sign up here!]

Pro tip: Don’t invest in anything you don’t understand

4. Research Halal Investment Platforms 🕋
With investing, we’re not just thinking about profits but also keeping our investments halal. Explore platforms like Zoya to screen investments for halal options. This platform screens out haram industries, like interest, alcohol, gambling, etc. so you can make an informed decision. 💫

Why This Matters: Investing in ways that don’t align with our values can create stress, not to mention compromise your goals. Focus on halal options to invest with peace of mind, knowing your money aligns with your beliefs.✨

5. Connect with an Expert 💼
You may not need an advisor if your finances are simple, but once your investments start growing exponentially, having a financial advisor can make a huge difference.

A good advisor can help you with tax strategies, portfolio diversification, and more—things that can get costly if handled wrong. The right advisor can also help you avoid high-risk choices that don’t align with Islamic finance principles.

Why This Matters: The cost of bad financial decisions can be high. Having expert guidance, especially as your portfolio becomes more complex, can help you avoid costly mistakes and keep your wealth-building journey aligned with your values.

Pro Tip: Ask potential advisors about their knowledge of halal investments and their approach to financial planning.

6. Set Clear, Long-Term Financial Goals 🎯
Picture yourself on a road trip with no destination in mind. 🚘 Where do you go? Do you take the highway or the scenic route? Without a goal, it’s easy to get lost. Investing is no different!

If you’re saving for a big goal in 5 years (like buying a home), your investment choices will look very different than if you’re saving for a 20-year goal (like retirement). Long-term goals can handle more risk and growth, while short-term goals need more security.

Why This Matters: Without clear goals, you could end up in investments that don’t suit your needs, and that could cost you in missed opportunities or losses. Write down your “why” for investing, and set a timeline. Is it retirement? A big purchase? Or just growing wealth over time? Your goal is your compass. 🌱

Investing is a marathon, not a sprint. You’ll see highs, lows, and everything in between, but remember—every small step is progress. Allah has a plan for us, and while we put in the effort, we trust the outcome to Him. Take your time, stay committed, and remember that patience truly brings barakah. 📈

With intention, knowledge, and a solid foundation, you’re setting yourself up for a financial journey that’s both rewarding and secure. 🌿

Stay safe,

Fatimah ✨ 

Founder, Finance Girlie