Capital Wealth
Capital Wealth · Planning · Faith-Based
Principal FirstThe Faith Test

Can a RILA protect your principal and still pass the Community’s own test on interest, gambling and shared loss?

On the right segments, yes. Here is the guidance in the Community’s words, the contract measured against it, and the record behind the buffer.

By Capital Wealth · Sept. 21, 2026
An hourglass on a wooden desk beside a stack of old books in a sunlit studyCapital Wealth · Principal first
A house under a dark storm sky, lawn and palms still lit by sun
Buffer segments
Pass

Gain and loss are shared with the company. No rate is promised in advance.

A stone viaduct of many arches standing over a still river in morning fog
100% protection
Pass · ask

Your principal is guaranteed; a profit is not. Ask if a guarantee of any kind troubles you.

An old bank passbook and a pen on a counter
Fixed segment
Out

A declared 3% on money handed over is interest, by the Promised Messiah’s own definition.

The empty trading hall of a stock exchange at sunrise
The index underneath
Okay on the verses

Followed inside the contract it is trade by mutual consent, not interest and not a game of hazard. Owned outright, only the screened part.

01The ruleTwo things forbidden · everything else is an agreement
“With the exclusion of interest and gambling, the Shariah has permitted other agreements and responsibilities.”The Promised Messiah (as) · Badr, 27 March 1903
Morning light falling through a carved lattice window across a stone floorThe same line for 120 years
  1. 2:277“Allah abolishes interest and causes charity to increase.”The Holy Quran
  2. 1904Interest is lending money “for a prearranged profit in return.”The Promised Messiah (as) · Al Badr
  3. 1930Insurance may be permissible when company and policyholder “share the profits and losses.”Hazrat Khalifatul Masih II (ra) · Al Fazl
  4. 1980Permissible on one condition: “nobody should take any interest from the insurance company.”Majlis-e-Ifta, approved by Hazrat Khalifatul Masih III (rh)
  5. 2020Watching a share rise and fall “from morning till evening” comes under gambling.Hazrat Khalifatul Masih V (aba) · to the Sweden delegation
  6. 2023Capital that shares “in both profit and loss” is permissible; a profit with no share in loss is interest.Hazrat Khalifatul Masih V (aba) · Al Hakam
02How a RILA worksA contract · an index · a buffer
Waves breaking against a stone seawall below a green headlandA buffer is a seawall · it takes the first slice

The buffer

The company absorbs the first 10% or 20% of an index loss. You take what is left.

100% protection

No loss from the index. The gain is capped: 42% over six years, 60% with the rider.

The term

One, two or six years. The money is committed for six, with 10% a year free to take out.

You own no shares and receive no dividend; the credit is a formula on the index level. Every segment and rate is on the calculator →

03The testSix questions, asked the Community’s way
A hand signing a contract at a wooden desk

Is the profit prearranged?

No. The credit is whatever the index did, and it can be zero.

Pass
Two partners reviewing papers across a desk

Is the loss shared?

On a buffer, yes: the company takes the first slice and you take the rest.

Pass
A trading floor under a wall of market screens

Is it gambling?

The money is committed for years and credited on the whole economy. Nothing to watch.

Pass
One hand resting on another over an envelope

Is interest taken from the company?

Not by you. No fixed segment, and any credit labelled interest goes to charity.

Handled
A city skyline rising out of fog

Is the index screened?

No, and the contract does not own it. It follows it: trade by mutual consent, not interest, not hazard. The verses are in section 04.

Okay on the verses
Glass jars of coins with blank tags, set aside in a row

What about zakat?

2.5% of the contract value on your valuation date, run with the book.

Handled
04The S&P 500Is it okay? The verses first, then the answer
A city skyline rising out of morning fogThe whole market · and the part that passes

Is the S&P 500 okay? Put the verses first. Then separate the two things a household actually does with the index: being paid by it inside the contract, and owning all of it outright.

  1. 2:276“Allah has made trade lawful and made interest unlawful.”Trade is the permitted thing. Interest is the forbidden thing. The line runs between them, not around the market.
  2. 4:30“Devour not your property among yourselves by unlawful means, except that you earn by trade with mutual consent.”A contract two parties sign with open eyes is trade with mutual consent.
  3. 5:91“Wine and the game of hazard … are only an abomination of Satan’s handiwork. So shun each one of them.”The game of hazard is the other forbidden thing: a gain that turns on chance, watched like a table.
  4. 5:88“Make not unlawful the good things which Allah has made lawful for you, and do not transgress.”What the verses do not forbid, we are told not to forbid.
  5. 22:79“He has chosen you, and has laid no hardship upon you in religion.” “Allah desires to give you facility and He desires not hardship for you” (2:186).The rule is a line to keep, not a burden to invent.

Being paid by it: okay

The buffer segment on the S&P 500 is a contract you and the insurer sign with open eyes: trade with mutual consent (4:30). It fixes no rate in advance, so it is not interest (2:276). It shares the loss and is held for years, not watched like a game of hazard (5:91). The index is a yardstick; you own no share of any bank inside it, and no dividend from a brewer reaches you. To forbid the contract because a bank sits inside the yardstick would be to make unlawful what the verses have not (5:88), and to lay a hardship the religion does not lay (22:79). On the verses, and on the Community’s counsel of 2022 not to hunt for interest’s indirect trace, the S&P 500 inside the contract is okay.

Okay on the verses

Owning all of it: not the way

A plain S&P 500 fund is different: it owns the five hundred companies themselves, the banks at about 12% of the index by weight and the brewers, casinos and tobacco makers with them. The 2020 guidance permits shares of ethical businesses and names pubs, bars and gambling as the ones to leave out, so the fund that cannot leave them out is not the way to own the market. The screened part is: roughly 220 of the 500 pass S&P’s own screen, the North Star Faith-Based holds them through SPUS, and the single names are checked on Musaffa and Zoya.

Screened book instead
“If one wishes to buy shares of various companies, there is no harm in doing so. They should be businesses that you know are ethical. You should not make investments in companies that establish pubs and bars or companies that are associated with gambling.”Hazrat Khalifatul Masih V (aba) · to the Sweden delegation, 13 March 2020 · The Review of Religions, 15 Nov. 2021

So: the screened book owns the market, the RILA is paid by it, index segments only. The reading and the verses behind it go in your file in your own words; the scholars have the last word, and if a carrier ever offers a screened index on a contract we will use it.

05Principal firstEvery rolling S&P 500 period since 1984
A white lighthouse on a rocky point above a calm sea at dawnPrincipal first
0losing six-year periods after a 20% buffer
43 of 433six-year periods lost before it, none by more than 20%
23 of 493one-year periods still negative after a 20% buffer, from 100
42%the six-year cap on the 100%-protection segment

Two costs that are not faith questions: the credit is price return, about two points a year behind the dividends, and the money is committed for six years.

06In the planThe book grows it · the sleeve protects it
A couple reviewing papers together at a kitchen tableSized by the date, not the fear
  1. Size by the date. Only the dollars that must be there on a date go in the sleeve.
  2. Index segments only. Never the fixed segment.
  3. Take no interest. Anything labelled interest goes to charity, receipt in the file.
  4. Zakat once a year, with the contract and the book on one sheet.
The Faith-Based books →
07Your callWe show the lines · you decide

We will not call a product permissible. That belongs to the Community’s scholars and to your conscience.

Take the question to Ask Islam on alislam.org or to Al Hakam’s Answers to Everyday Issues, and bring the answer to your review. It goes in the file next to the plan.

Forest trails dividing below a snow-capped mountain at dawnYour call
Sources · every quote, dated

Capital Wealth LG is an independent investment advisory practice. This page is education for a planning conversation, not a recommendation to buy any security or contract and not a religious ruling; the quoted guidance should be read in full at the sources above. A registered index-linked annuity is a long-term contract issued by an insurance company: caps and participation rates limit the gain, buffers provide limited protection, withdrawal charges apply during the six-year period, credits are based on index price return without dividends, and guarantees rest on the claims-paying ability of the issuing insurer. Rates are from the carrier’s sheet dated 06/15/2026 and change; the rate in force is the one on the application date. Historical periods are shown for illustration; the product did not exist in them, and past performance does not guarantee future results.