Monem Salam:
Welcome to Halal Money Matters, sponsored by Saturna Capital. I'm Monem Salam. And today we're going to talk about something very interesting because every year around the time of March, people are thinking about, after doing their taxes or right before doing their taxes, you know, how much money should I be contributing to an IRA, Roth IRA, all these different types of different nontaxable accounts. So today we have Hud Williams on the podcast. He is regional manager for Saturna Capital. He has a degree, an MBA, actually, from the Georgia Institute of Technology, and he's currently pursuing a certificate in Islamic finance at a university in Malaysia called INCEIF, which is the International Centre for Education in Islamic Finance. I'm really excited to have him on the show. So let's get started.

[music]

Monem Salam:
So Hud, welcome to the show.

Hud Williams:
Thank you. Thank you. Glad to be here.

Monem Salam:
Yeah, you know, this is a really interesting time to be having this podcast. I mean, tax deadline is coming up really soon, and this is sometimes the time when people really think, begin to think about contributions to any of their any of their retirement plans.

Hud Williams:
Definitely, definitely. So let's get to it.

Monem Salam:
Okay, let's do it. So, you know, I think what we'll do in the show is really kind of talk about individually, each of the different types of plans, and then, and then we'll, we'll get into a little bit about retirement plans for your employer, but I think we want to stick to those that are going to be more for the individual level. So let's start off and really talk about the main one, which is what's called a traditional IRA.

Hud Williams:
Definitely, definitely. So let's backtrack, because let's talk about individual retirement accounts as a whole. So when you think about individual retirement accounts, this is your retirement account outside of your employer. So at your employer, you can have a 403(b) or 401(k), if you don't, if you're not offered that at your job, then outside of it, you can open an individual retirement account.

Monem Salam:
Can you contribute to both in the same year? That's really the question people would be asking. I guess.

Hud Williams:
It depends,okay, it depends on salaries, and we'll get into some of the specifics. But when we look at an individual retirement account, we have two flavors, have a traditional and then you have what's known as the Roth IRA. And so when you think about an individual retirement account, between those two flavors, there are three similarities that go through both of them. The first one is contribution limit. How much money can you contribute to an individual retirement account? And that limit for 2024 is $7,000 as well as 2025 is $7,000.

Monem Salam:
And that, that one, the IRS changes once in a while, and there's an announcement that's made and if you call like, for example, Saturna, they'll be able to tell you what that contribution limit is.

Hud Williams:
exactly, exactly. And so what happened in 2024 to 2025 is that the government left it the same, okay, but usually that they will change it in December, and they will let folks know, the public know that this is the new contribution amount.

Monem Salam:
There's a, there's a, that's a caveat, because of the contribution limit, if you're above the age of 50, which I think we have till both of us have, like, 25 years left before we're 50. But if you're above the age of 50, then you can do more.

Hud Williams:
Exactly, so the $7,000 if you're under 50, if you're over 50, then it's $8,000 so that's the first one. The second one is time frame. So you have up until the April tax filing deadline of the next year to put in money for the previous year. And so let me make it simple. For the year 2024 you have up until April of 2025 to contribute that seven or $8,000.

Monem Salam:
Okay, so in this, in this one, but it's April 15. If you file on April 15, so if you file earlier, then you've you've lost whatever that date is that you filed is the date you're going to have.

Hud Williams:
Exactly. So when you're filing your taxes for that tax year, before that time, you can contribute for that previous year. So 2024, taxes, you can contribute up till April 15, or the time that you filed your taxes.

Monem Salam:
And I think you have to also tell your the your hosting company, like free here, Saturna Capital, hey, I'm putting this contribution in, and this is going to be for last year.

Hud Williams:
Exactly, exactly. Sometimes they will ask you, is this a 2024 contribution or 2025 but please note when you're calling in, and if you want it for that previous year, to let the person know that this is a 2024 contribution. So the third similarity across the two is the tax deferred status of an individual retirement account. And this means that when you put in 7000 a year, and this money grows right into retirement, that it's going to grow tax deferred. So that means that if there's any capital gains, if there's any dividends, if you buy one fund and then you sell it and there's a capital gains and you buy another fund, you're not going to have to pay any taxes for this, so it's tax free growth while you have your funds invested in an individual retirement account. So across both flavors, the traditional as well as the Roth, all these three things are the same.

Monem Salam:
All right. So now that we talked about the same, it's time to talk about the differences.

Hud Williams:
The differences, and this can be tricky, but I want folks to know is that you will understand this over time, after you start investing, after you start putting money into an IRA, year after year, you're going to understand these differences. It's almost like playing a new game. Like if someone's sitting down and playing Monopoly for the first time, they're going to say, what are these chance cars, what's a community chest? But after you play the game for a while, you start understanding, okay, so the difference is, the traditional is that you get a tax deduction for the year that you're putting in the contribution for traditional. So for example, if you make $50,000 and you contribute $5,000 to a traditional IRA, then at the end of the that tax year, it will be as if you made $45,000.

Monem Salam:
Okay, so basically, you're saving the tax rate.

Hud Williams:
Yes, you're getting a tax deduction. And so then it's going to grow tax deferred. And then when you're in retirement, then when you bring money out of your individual retirement account, your traditional, that's when you'll pay taxes. The Roth, on the other hand, you get no tax deduction when you put it in, it's still going to grow tax deferred. But then when you're in retirement, or when you take it out in retirement time frame, you won't have to pay any taxes on the money that you're taking out.

Monem Salam:
So it's really like either tax now or tax. Leader, exactly, right? So the Roth is tax now, not taxes later. Traditional is no taxes now, but you'll have to pay taxes after you take it out.

Hud Williams:
Exactly. And so the question is often asked, Hey, Hud, which one should I do? Which one is better for me? And then there's two answers to this. The first one is, there's a math answer where you can actually calculate what is your tax rate now, how much you're going to save. What you don't know is going to be the tax rate in the future, and that's kind of unknown. But then there's also the answer that says, hey, which one works better for you and your kind of personal saving and retirement goals?

Monem Salam:
Yeah. So let's, let's kind of break those down a little bit. So the first one, my assumption would be that, you know, the math, would be like, okay, so what's my tax bracket now, and what's going to be in the future? So if my tax bracket is low now, maybe I'm just starting off in school right after college. I'm not making a lot of money, or maybe I am, but I'm single in lower tax bracket. And then, you know, that might be maybe beneficial for a Roth.

Hud Williams:
Exactly.

Monem Salam:
Okay. And then if I'm as I'm getting older, right, then if I don't have an employer, employer plan, it might be better for me to put it into a traditional because the savings I'm getting now immediately are going to be at a higher rate because I'm in a higher tax bracket.

Hud Williams:
Definitely, one of the things I often encounter is students who are maybe have a part time job, or maybe have a job where they're not making like kind of their full salary. So if you think about someone doing their residence, a soon to be doctor, but they're not making the doctor salary. So if they use a Roth now, and they pay taxes on it, and then it's going to grow tax free, and they're going to be in higher and higher tax brackets later on. Also one of the things to consider about the Roth is that if you are a high wage earner, then it limits how much money that you can put into a Roth.

Monem Salam:
And how do you define a high wage earner?

Hud Williams:
The IRS is going to define it. And so every year it changes, and there's a rate for single, and then there's a rate if you're married as well. So the single rate is roughly around 140,000 because it's a range. So there's a one range where it kind of phases out how much you can put in from maximum contribution. So single is around 140,000 and the married amount is roughly around $220,000.

Monem Salam:
So, you know, I found out something really interesting, just the other day, because I was talking to a family member. If you file married, like each file joint, and what you call it, married and joint. Then you that's the limit that applies, which is the 220 that you talked about exactly. But you know what the income limit is? If you file married separately, like, $10,000 it's like, ridiculous. It was, like, so weird that it was so small, but yeah, one of my relatives actually messed up on the taxes. And filed it one way. And he wasn't eligible for it. He has to do a refilling, whatever. So, so do be careful. I know a lot of times people go online and do these things, just be make sure you're, you're doing the filing of your taxes properly, so.

Hud Williams:
Definitely, definitely.

Monem Salam:
So that's regarding the contributions and the limits and those type of things, right? What can you invest in?

Hud Williams:
So that's a great question. So for an individual retirement account, one of the most powerful reasons why you have an individual retirement account is because you have a wide array of investment options. So you can invest into stocks, you can invest into Sharia compliant mutual funds, you can invest, in some cases, even into real estate.

Monem Salam:
The choice is there for you to do whatever it is that you want to do.

Hud Williams:
One of my mentors said to me early on, when I was doing presentations on Islamic investing, is that when you want to make your investments Sharia compliant, you always have to have more choices. So the more choices you have, the more ability that you're going to be able to get your investments to be Sharia compliant. Do you remember who that was?

Monem Salam:
I'm going to guess. No, I don't actually. Don't know.

Hud Williams:
That was you. That was you. (laughs)

Monem Salam:
I appreciate that. So now that we talked a little bit about the contributions themselves and what you can actually invest in. Now we need to talk a little bit about when and when and how you can take it out, because I think in some cases, there's actually penalties involved.

Hud Williams:
Exactly. Remember that these are individual retirement accounts, so the purpose of it is for retirement. But we know that life often happens, and so if you have a personal emergency that and you need to access these months these funds, then there's going to be allowance for accessing the funds. However, because they were put in for retirement, the government is giving you that tax deferred because it wants to encourage retirement savings, and so taking out early is going to require some penalties for a traditional, right, you got a tax deduction when you put it in. So anytime you take it out, that you're going to have to make sure you pay the taxes on it. So one of the ways when you can take it out without penalty is for the early retirement age. So the early retirement age is 59 and a half. Then you can start withdrawing the money from the individual retirement account, where there's a traditional or Roth without penalties. But in the traditional you're still going to have to pay taxes, while in the Roth, you won't have to pay taxes. Additionally, there's some withdrawals for life challenges or life events, when you think about buying a home for the first time, when you think about major medical expenses, if you have to file for bankruptcy, and also if you're putting money in for if you're using the money to pay for college, for anyone in your immediate family, for these reasons, after five years, you can take the funds out of a Roth for any of those four reasons without taxes and penalties.

Monem Salam:
I mean, that's a really good point that you mentioned, because I think let's, let's kind of tie back to early tie back to earlier you were talking about, you know, kids or younger, young adults that have part time jobs and they're working, but they're not, you know, obviously they're still dependent on their parents. And if you put that money away into a Roth, for example, and you let the money grow tax free, then they could end up using it for their own education without any penalties, because they're taking it out for that education purpose.

Hud Williams:
Definitely, definitely. Another idea that we have discussed is called Hajj 59. Hajj 59 is starting a Roth IRA in order to make Hajj right. And so if you put in funds in order to make Hajj, and say it's $5,000 a year, and you kind of let it grow. At the age of 59 you can take your funds out of your Roth IRA, without penalties, without taxes, and you can use those funds to then go make Hajj.

Monem Salam:
Yeah, that's really good. That's a good point. And you can, I mean, from that perspective, you can actually use it earlier, because if you're putting in 5,000 a year, let's supposing in five years you've contributed 25,000 right? You take that out, the principle out for your Hajj, and then you let the rest of it kind of grow, or whatever else might might come up. Maybe it's 59 and a half for your retirement, or maybe for your college tuition, for college, you know, those type of things as well. But I like that idea of the Roth 59 that's that, that's really good. I think, I think I'm going to patent that.

Hud Williams:
Definitely, definitely.

Monem Salam:
So okay, going back, so both of them have penalties. It's just a matter of, again, the taxes is what's going to determine whether it's a traditional or Roth, that type of thing, right? And then you mentioned in retirement that can be done as well. Are there any benefits for having a Roth versus a traditional, or traditional versus a Roth?

Hud Williams:
Definitely, definitely. One of the benefits, especially when you look at withdrawal, when you look at a withdrawal, the Roth IRA has the benefit of you're not going to be required to take it out. For example, for the traditional where you got a tax deduction when you put it in, it grew tax free. The government never had a chance to tax it. So at the age of 73 and a half, you're going to be required to take out a minimum distribution every year, right, whether you want it or not. But part of that reason, or the idea behind that, is that the government can now tax it so the required minimum distribution, they'll be able to tax it. On the Roth side, because the money was taxed when you received it, so it was after tax money, you're not required to have a required minimum distribution when you're 73 and a half, so you don't actually have to take it out. And so, and while we're on the subject of the withdrawal process, it's important to note that one of the other advantages of an individual retirement account is that it gets passed to your heirs automatically upon you passing away. So it doesn't have to go through the process of a will. It doesn't have to go through the process of a trust, it's that upon you passing you, the money will pass to your beneficiaries. Second thing that you do when you open your account is actually name your beneficiaries for your individual retirement account.

Monem Salam:
Yeah. So I want to go back to this idea of the on the like, the required minimum distribution, which is the RMD and also taking, I mean, a couple of things that are really important. Number one is the fact that, I mean, you know, I mean, everything's based on intention. I mean, so why you're doing it? But really, you should be thinking about what it is that you're trying to do. The two scenarios come to my mind, right? So let's supposing I did start early on what, you know, I graduated from college, I started putting money into my, you know, Roth versus traditional. And then, you know, 30 years from now, my kids are going to college, right? And I need to take pull money out to be able to do that. Now, here's a scenario, right, 30 years from when I started doing it. I'm in a lot higher tax bracket, and then when I take the money out of my traditional IRA, I'm going to be bumped up maybe into another tax bracket, because I took money out of it for my college, for the way kids college tuition. So you might be ending up paying a lot higher taxes, even though the kind of math was to be able to pay lower taxes. So that's one scenario. The other one, which I can think of is, and people don't think about it, because it's such a long way away, is that you can really accumulate a lot of money within these IRAs, right? And so you know, if you have the RMDs at 73 and a half, you know, you could have technically put in about $210,000 into your account, from yourself, and then the growth could have been a lot more. And so there are people now that have RMDs that are so large because their IRAs are so large, and so you're forced to take it out, and you're going to be forced to pay taxes on it. So it's really, really important to kind of think about this a little bit more.

Hud Williams:
Of course, one of the tax advantages of giving is that you can actually donate your required minimum distribution to a 501(c)3 of your choice, up to $100,000 so if you are receiving an RMD, and you don't want to receive it and then pay taxes on it, then you can actually go and donate that to a 501(c)3, of your choice.

Monem Salam:
Yeah. But the beauty of maybe, in this particular case of a Roth over a traditional is that there are no RMDs or requirement and distributions for a Roth IRA.

Hud Williams:
Exactly. There's no requirement of the distribution.

Monem Salam:
And then, I know this is getting a little technical, but maybe looking at for if somebody's listening to this, and then they're older, you know, I think in the in the traditional, once you've passed away, and it goes to heirs, they have a time limit of when they need to be able to withdraw money from their beneficiary, IRA, traditional, but in the Roth, there's no there's no time limit. They can keep it for forever, if they wanted to.

Hud Williams:
The time limit right now for an inherited IRA is 10 years. And so it gets back to this traditional versus Roth. Back to taxes, as many things in our economy, is that for a traditional the funds will not be taxed until they're eventually taken out, whether in the lifetime of the person who started the IRA or his or her beneficiaries. For Roth, the money was taxed when it's put in. And so that's why it's really kind of a fair system, when you think about it, they've really thought about all the ways that taxes play a part in it. And so that's why you see these differences between the traditional and a Roth kind of carry through even past the lifetime of the person who started the IRA.

Monem Salam:
So now we're getting a little bit more granular and different exceptions and those type of things. So maybe we can kind of dig a little bit deeper into these areas. Number one being like, when you have an employer plan, right, that you maybe basically like, what's called either 401(k), or 403(b), those type of things, are you allowed to put money into a traditional IRA and take the tax benefit or the Roth and not take it?

Hud Williams:
So 401(k)'s have two different types of contributions. In some 401(k)'s, they are now allowing you to have a Roth contribution in your 401(k). Traditionally, the contributions in your 401(k) were tax deductions, so there are pre tax contributions. So now you can have a Roth or a traditional contribution, your 401(k). The employer's contribution is going to be pre tax and so there's limits on the amount of kind of pre tax contribution that you can put in. If you have a 401(k), then there's a limit on the amount of pre tax contribution that you can put in into an IRA when you have a 401(k). So there's an income limit that if you're above that income limit, you can't contribute to a 401(k) and contribute to an individual retirement account. However, that still allows you to contribute to a Roth IRA, because that money is being put in after tax.

Monem Salam:
Okay, so, but then there's still those income limits.

Hud Williams:
Yeah, still the income limits. And so when you're thinking about these things, there are going to be a lot of nuances. You know, if you are 25 years old and you make 25,000 it's going to be very, very clear. But when you're in these upper wage earners, you want to make sure that you pay attention to these nuances, and you kind of consult professionals, especially for any tax advice.

Monem Salam:
I know that we talked about income limits, kind of multiple times now, but there are exceptions to that. There is a way for you to put money into a Roth IRA, even if your income is higher.

Hud Williams:
So okay, my understanding is that we were on Retirement Planning 101, I didn't know we were going to get into Retirement Planning 400 level. But of course, there's what's called a a Backdoor Roth. And so a Backdoor Roth would allow, or Roth Conversion is the official name, but the it's colloquial we referred to as a Backdoor Roth. And so a Backdoor Roth is when you are a high wage earner. So let's say you make $300,000 and you cannot put in money the traditional way into a Roth IRA. And so the Backdoor Roth means that you open a traditional IRA, you fund that traditional IRA, and then you're allowed to convert that money over to a Roth IRA, but you want to make sure that you do not claim a tax deduction for the funds that you put into that traditional IRA.

Monem Salam:
So now that we're talking about, you know, tax deadlines and those type of things, specifically, we're going Backdoor. The deadline for putting in the Backdoor for that year is going to be the end of that year. It's calendar year, not your tax deadline or whenever you file it.

Hud Williams:
Yes.

Monem Salam:
Okay, so we did talk about, you know, these two, the traditional and Roth, are mainly for individuals. But there are, you know, besides the larger 401(k)s and those type of things, there are other types of IRAs or vehicles that companies can use as well to be able to help their employees save for this, for the retirement.

Hud Williams:
Definitely, and I'll just focus on three of them. The first one is going to be one where you have partners who are owners of a company, and it's called a SEP IRA. So a SEP IRA allows the company to contribute to the retirement account. The caveat is that the percentage that it contributes has to be an equal percentage for every employee, and so where we see the most for SEP IRAs is where there may be one or two partners, or there might be a company where it's a husband and wife, and so they can put in the same percentage up to $69,000, it's 25% of your income up to $69,000 for a SEP contribution.

Monem Salam:
Yeah. So like, for example, if you did 25% up to that 69 then if you had three employees that were not related to your they were just working in your company, you would have to give 25% of their income and put that into that SEP IRA as well. So exactly. I mean, great, if you want to be generous, but I think a lot of people would be kind of turned off by that.

Hud Williams:
Exactly. And so then we have two other options, right? We have what's called the SIMPLE IRA. The SIMPLE IRA is where you can do a contribution for yourself and for your employees, and the contribution you have the option of doing and matching a contribution of up to 3% or you can do a voluntary contribution where you are putting in money for your employees up to 2% so for a SIMPLE IRA, you have those two options. Of course, you know, there's very a lot of nuances within the SIMPLE IRA, but also the employees can also contribute.

Monem Salam:
But that's but you're required to do that. The contribution you can get away with not doing it.

Hud Williams:
Yeah, you required to do one or the other. And for example, if you're doing a matching, some years, you can go down to matching at 1% but it's between three to 1% in terms of matching,

Monem Salam:
But the benefit of both of these is there's no admin cost. And I mean, it's no pun intended, but it's a simple way to do it.

Hud Williams:
Exactly, no pun intended. It's a simple it's a very simple and it also satisfies the requirement for retirement plan. And so there's many states across our country that are requiring organizations to create a retirement plan for their employees. So a SIMPLE is one solution for those states who are requiring a retirement plans for your employees.

Monem Salam:
And you said there was three of them. So before we do the third one is, let's talk about deadlines for both the SEP and the And you ffor tax purposes, can we, can can you actually contribute the following year for a previous year, like for, for 2024, can I still in 2025 contribute?

Hud Williams:
So when you're thinking about a SEP, the contributions are going to be recorded on the day they come in. It's going to be up to the tax professional that you work with to kind of make sure that they get coded to the right time. And so when you're thinking about these taxes, especially as an employer, make sure that you have a proper tax consultant that'ss going to make sure that the tax rules are changing on an annual basis. So make sure that you're working with a tax consultant who's aware of the tax deadlines, who are aware of the nuances for these different types of contributions. So the third one and we want to talk about is called a 401(k). So it's pretty popular. It's a 401(k). There's also a version of the 401(k) is if it's just you at the company, or if it's just you and your wife, you can do or you and your husband, you can do a solo 401(k), and so similar to, like, a SIMPLE and a SEP that they have very kind of intricate tax rulings in terms of when you could put money in, when you could put money in as an employer, when you could put money in as an employee, for example, when you're thinking about a solo 401(k), if I establish a solo 401(k), if I establish it in 2024 I can still put in money in 2025, but just that first year. So there's a lot of rules and regulations about contributions into a 401(k) and so it's always best to consult a tax professional just to make sure that you're getting that right. Yeah.

Monem Salam:
I mean, right now we're basically talking about the individual person putting money in for these, for these type of things. So we're really talking about, if you own your business, then the SEP SIMPLE and 401(k) work and a whole another subject is going to be whether your employer, you know, can, can do that or not. Maybe then we'll, we'll save that for another, another podcast, because that gets really interesting as well. This has been amazing. I know a lot of people are going to be like, Wait, what did he say? You can easily go back and listen to this. Obviously, this, this, this podcast. But there's a lot of information that's available online as well at satirma.com where we talk about a lot of these issues as well. But is there anything else you wanted to kind of kind of wrap up this session with?

Hud Williams:
When I think about retirement, the individual retirement account is roughly 51 years old. It started in 1974 but when you think about what's happening for retirement, this is something that is kind of timeless when you think about it. And one of the ways that I kind of connect us to that timelessness of retirement savings is through one of these suras in the Quran. So when I'm giving these presentations, I often say that the Quran, the scripture for Muslims, talks about retirement, and people often are looking at me like I've never heard the Quran talk about a Roth. However, if you go to Surah, Yousuf and Prophet Yousuf, may God's peace and blessings be upon him. He's asked to interpret the dream of the Pharaoh, and in this chapter, the Pharaoh has a dream about seven fat cows and seven lean ones and seven green ears of corn and seven other withered and the lean cows are devouring the fat cows. So Prophet Youssef gives his interpretation, and it goes like this, that we're going to have seven years of great harvest, where it's going to be very plentiful. We're going to have more than we need. We're going to think this is going to continue forever. Those seven years are going to be followed by seven years of famine, where the harvest is very small, and the famine is going to be so dire that it's going to outstrip those years of great harvest. And so Prophet Yousuf said, put me in charge of your storehouses, and I'll make sure that we take from these years of good harvest to provide for those years of lean harvest. And so when I'm giving this presentation to audiences, I'm saying that you have to be in charge of your own storehouse, right? If we look at our life, we have roughly 85 years of living in the US. That's our lifespan. Those first kind of 20 or so years, we're learning, we're being educated, so we're just getting started. We're really not earning a lot of money.  Those last 25 years we're kind of slowing down. Our bodies are not functioning as well. So roughly, we have 40 years where we're going to make more money than we ever make in our lives. We have to take from those years to provide for these years where it's going to be a little leaner.

Monem Salam:
That's true, but I don't know if it applies to me, because my golden years, my amazing years, are going to be after I'm 60, especially when I'm 90, I'm going to be like snowboarding and and climbing mountains, doing all of those things, so.

Hud Williams:
You might have a lot of investments, right? But we want to make sure that folks are thinking about this as you go through your career. Because I think one of the hardest things for young Americans to think about is for retirement. In some studies, they say that young folks think about death more than they think about retirement. But retirement is going to be a reality, and so you have to prepare for it. And so in a similar fashion, I often say that retirement is like paradise, because you have to prepare for it. You just can't show up to retirement and say, hey, I want to retire. It's going to be, what have you put in a 401(k), what have you put in an IRA and you just can't show up to the afterlife and say, I want to paradise? It's like, well, what have you prepared for it? How much praying, how much good deeds have you done, so on and so forth? So we have to prepare for this thing that's called retirement.

Monem Salam:
That's really good. And since you're talking about parables in the Quran, I'll give you one that I just thought about as you were talking and I use this example for estate planning, but I think it can work in this, this area as well. And that is in the surah of the cave in the Quran, when the Prophet Moses is going out with the wise man Khidr. And he's, you know, he's going for different places. One of the places that he stops in the town where he's not given any kind of hospitality or food. So as they're leaving the town, there's a wall that's crumbling. And so what Khidr does, the wise man, he builds up that wall again. And so Musa asks him, like, why is it that you built up this wall? These people were so rude to us, you know, those type of things. And so he says, basically, that underneath this wall was a treasure belonging to two orphans whose father was a righteous man. So basically, at that time, the father, the way he knew how to save was to bury the treasure for his sons to be able to claim. And if you think about it from a Roth perspective, or even from an traditional IRA, you're putting money away to be able to pass it on, in the case of the Roth, probably 100% of it to your heirs, and they can keep it forever, whereas maybe in the in the traditional one, yes, you still passing it on, but they're going   have to spend it within 10 years.  

Hud Williams:
We have to be careful, because this can really turn into a Quran. (laughs)

Monem Salam:
And that's true. No, no less, we can probably…

Hud Williams:
Process as a retirement. But I think  that's definitely something that I'm going to make sure that people know about kind of this Roth is like a buried treasure.

Monem Salam:
Well thank you so much, Hud. I mean, I think this has been really great, I do think our listeners are really going to be benefiting, especially since if they haven't, you know, filed their taxes already. They have until April 15 to do it every year. They can take advantage of these kind of, you know, retirement planning tools like the traditional and the Roth and those type of things. So really appreciate your time, and thank you for coming on.

Hud Williams:
No problem.

[music]

Monem Salam:
Thank you for listening to Halal Money Matters. If you like what you hear, please do rate us on the app stores and also leave us a review. It helps other people find us a lot easier.

Disclosures read by narrator:
The thoughts and opinions expressed on Halal Money Matters do not necessarily reflect the views of Saturna Capital, Amana Mutual Funds, or their affiliates. This podcast is prepared based on information Saturna Capital deems reliable; however, Saturna Capital does not warrant the accuracy or completeness of the information. We do not provide tax, accounting, or legal advice to our clients, and all investors are advised to consult with their tax, accounting, or legal advisers regarding any potential investment. Investors should not assume that investments in the securities and/or sectors described were or will be profitable. Investors should consult with a financial adviser prior to making an investment decision. The views and information discussed in this commentary are at a specific point in time, are subject to change, and may not reflect the views of the firm as a whole. All material presented in this publication, unless specifically indicated otherwise, is under copyright to Saturna. No part of this publication may be altered in any way, copied, or distributed without the prior express written permission of Saturna Capital.

Performance data quoted herein represents past performance and is no guarantee of future results. Investment return and principal value of an investment will fluctuate so that an Investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be significantly higher or lower than data quoted herein. Performance current to the most recent month-end can be obtained by visiting www.amanafunds.com or by calling toll-free 1-800-728-8762. Please consider an investment's objectives, risks, charges and expenses carefully before investing. To obtain this and other important information, which you should carefully consider before investing, about the Amana Funds in a free prospectus or summary prospectus, please visit www.amanafunds.com or call 1-800-728-8762. The Amana Funds limit the securities they purchase to those consistent with Islamic principles. This limits opportunities and may affect performance. The Amana Funds are distributed by Saturna Brokerage Services, member FINRA/SIPC and a wholly-owned subsidiary of Saturna Capital, investment adviser to the Amana Funds.