Investment Advice
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I’m 20 years old and recently started a small business. I want to begin investing in a way that helps diversify my money, but I prefer a simple and mostly passive approach since I don’t want to actively manage investments or spend a lot of time studying the market. I also want all investments to be fully Shariah-compliant.
Recently, I’ve been researching Islamic mutual funds and income funds, particularly those offered by Alfala Asset Management and they seem promising. However, I’m still trying to understand which options would suit me best.
I’m comfortable with higher-risk investments and I’m willing to stay invested for at least 1-3 years or longer. At the moment, I can invest around 10,000 PKR initially, and then continue investing a portion of my monthly business profits. Right now, I can probably contribute between 1,000-5,000 PKR per month, with the intention of increasing that amount as my business grows.
I’m also trying to build a proper long-term financial strategy for myself. My current idea is to save 50% of my monthly profits. From those savings, I’m unsure whether I should:
▪︎ Invest all of it into mutual funds
▪︎ Split it between high-risk and low-risk funds (Low-risk would be used like emergency fund)
▪︎ Keep part of it as cash savings.
One reason I’m considering investing more aggressively is because I understand that money can lose value over time if it simply sits idle due to inflation.
My other idea is to use the remaining 50% of my profits to continue growing and expanding the business. Overall, this approach feels balanced to me, but I’m not sure whether it’s financially optimal.
Currently, Alhamdulillah, most of my personal expenses are covered by my family, except for fuel costs. However, I also want to prepare for a future where I may need to fully support myself and my family financially. In that situation, I would need to balance:
▪︎ Personal living expenses
▪︎ Business reinvestment
▪︎ Emergency savings
▪︎ Long-term investments simultaneously
I’m looking for a simple, practical, and sustainable financial strategy that allows me to grow financially over time without making things unnecessarily complicated. In the near future or mid future? I might/will try opening new businesses too. I have a lot of stuff on my mind but I don't have capital to do stuff.