Set your age, salary, contribution rate, and employer match. See your projected balance at retirement using halal fund growth rates side-by-side with a conventional index fund — plus a full breakdown of contributions vs. investment growth.
~10%/yr
S&P 500 historical avg.
~18%/yr
SPUS since 2019 launch
SPUS · HLAL · ISDU
Halal funds modeled
Enter your current age, planned retirement age, and current 401(k) balance to establish your starting point.
Set your annual salary and what percentage you contribute. The calculator shows your exact monthly contribution amount.
Enter your employer's match percentage and cap so the calculator can compute the 'free money' added to your balance.
Adjust the halal and conventional return assumptions to match your actual fund choices and see the projected difference.
The 401(k) itself is not inherently haram — it's simply a tax-advantaged structure for diverting part of your salary into investments. There is nothing in the mechanics of tax-deferred or tax-free growth that conflicts with Islamic principles. The compliance question is entirely about what you choose to invest in within that structure.
Most employer 401(k) plans offer a limited menu of pre-selected mutual funds and target-date funds, virtually none of which are explicitly Shariah-screened. This means most Muslim employees face a real dilemma: contribute to capture valuable employer matching, using funds that may contain interest-bearing bonds or conventional bank stocks, or forgo the match entirely. This calculator helps you model both scenarios so you can make an informed decision.
SPUS
Holds ~220–250 S&P 500 constituents that pass Shariah screening. The closest halal equivalent to a standard S&P 500 fund. Launched 2019.
HLAL
Tracks the FTSE Shariah USA Index. Heavily weighted toward technology and communication services. One of the first US-listed halal ETFs.
ISDU
Tracks the MSCI USA Islamic Index from BlackRock/iShares. Broad-based exposure with institutional-grade screening methodology.
These funds exclude companies failing AAOIFI screening — interest-based banking, alcohol, gambling, and companies with debt exceeding 30% of market cap. This structural exclusion of heavily-leveraged sectors has, historically, sometimes resulted in competitive or better returns versus the conventional S&P 500. Past performance never guarantees future results.
Many large 401(k) plans offer an SDBA window that allows participants to invest in any publicly traded ETF or stock — including SPUS, HLAL, and ISDU — rather than being limited to the plan's default fund menu. Ask your HR or benefits administrator if this option exists.
Contribute enough to receive the full employer match using the least objectionable available fund (broad S&P 500 index funds are considered acceptable by many scholars, with appropriate purification of any incidental interest income). When you change jobs, roll the full balance into a halal-focused IRA.
Use a platform like Wahed Invest, which offers fully automated halal Roth and Traditional IRA accounts with built-in Shariah screening and Zakat tracking, or a self-directed account at Schwab/M1 Finance where you manually select halal ETFs. The 2026 IRA contribution limit is $7,000 ($8,000 if 50 or older), separate from your 401(k) limit.
An employer-sponsored retirement plan where the underlying investments are screened for Shariah compliance. The 401(k) tax wrapper itself is permissible — compliance depends entirely on fund selection.
Additional money your employer contributes based on your own contribution, often capped as a percentage of salary. Effectively free retirement money — losing it by not contributing has a real opportunity cost.
The standard used to determine if a fund's underlying holdings are halal — excluding interest-based banks, alcohol, gambling, and companies with debt exceeding 30% of market capitalization.
An option within some 401(k) plans allowing investment in a wider range of securities beyond the plan's default fund menu — the key to accessing halal ETFs inside an employer 401(k).
Donating the impermissible-income percentage of investment returns to charity. Relevant if you hold any fund (halal or conventional) with incidental interest income before fully transitioning to halal options.
How investment returns generate their own returns over time. The core engine behind long-term retirement growth — small differences in annual return rate compound into large differences over decades.
The 401(k) account structure itself is permissible — it's simply a tax-advantaged savings wrapper. Whether your 401(k) is halal depends entirely on what you invest in within the account. Most employer plans offer a limited menu of mutual funds, and you'll need to check whether any are Shariah-compliant. A growing number of plans now offer S&P 500 index funds (often considered acceptable by many scholars with some caveats) or dedicated Shariah-compliant fund options. If your employer's 401(k) has no halal options, you can typically still contribute to capture the employer match, then roll over to a self-directed IRA with halal funds upon leaving the job, or ask HR about adding a Self-Directed Brokerage Account (SDBA) option.
The most widely used Shariah-compliant US funds include SPUS (SP Funds S&P 500 Sharia Industry Exclusions ETF), HLAL (Wahed FTSE USA Shariah ETF), and ISDU (iShares MSCI USA Islamic ETF). These screen out companies failing AAOIFI criteria — interest-based banking, alcohol, gambling, and excessive debt. Since their respective launches, several of these funds have shown performance comparable to or exceeding the conventional S&P 500, partly because excluding heavily-leveraged sectors like banking has acted as a structural quality filter. Past performance never guarantees future results.
Halal screening excludes companies with high debt-to-market-cap ratios (above 30%) and conventional financial institutions. This means halal funds are structurally underweight in banking and finance and overweight in technology and healthcare compared to the broad S&P 500. During periods when tech outperforms, halal funds can outperform. During periods when financials outperform, halal funds may lag. Over the long term, several halal ETFs have shown competitive or better returns, but year-to-year results vary and the sector tilt cuts both ways.
Enter your employer's match percentage (e.g. '50%' means they contribute 50 cents for every dollar you contribute) and the match cap (e.g. '6%' means they only match up to 6% of your salary, even if you contribute more). The calculator computes your effective employer contribution monthly, capped appropriately, and adds it to your projected balance separately from your own contributions and investment growth — so you can see exactly how much is 'free money' from your employer.
Many Islamic finance scholars permit this as a necessity-based exception, especially if you plan to convert or roll over the funds into halal investments as soon as possible (e.g. after leaving the employer) and purify any interest-bearing growth along the way. Turning down free employer matching money entirely has a real opportunity cost. That said, this is a personal religious decision — consult a qualified Islamic finance scholar for guidance specific to your plan's options and your own comfort level.
Options include: (1) Ask HR if a Self-Directed Brokerage Account (SDBA) window is available within the 401(k), which lets you buy any publicly traded ETF, including SPUS or HLAL. (2) Contribute enough to capture the full employer match using the least objectionable available fund (e.g. broad S&P 500 index, which some scholars find acceptable), then roll over to a halal IRA when you change jobs. (3) Open a separate Traditional or Roth IRA with a halal-focused provider like Wahed Invest for additional retirement savings outside the 401(k) structure entirely.
This calculator defaults to 9% for halal funds and 10% for conventional, reflecting long-term historical averages with halal funds running slightly more conservative due to a smaller, more concentrated holdings universe. However, you should adjust both sliders to match your actual fund choices and risk tolerance. Younger investors with longer time horizons may use higher assumptions; those closer to retirement often use more conservative figures. These are projections, not guarantees — actual returns will vary year to year.
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Read the guideThis calculator projects retirement balances using compound growth assumptions you control — results are estimates only, not guarantees. Historical fund performance (including SPUS, HLAL, and S&P 500 figures referenced) does not predict future returns. Investment values fluctuate and can decline. Not financial, investment, or religious advice. Consult a qualified financial advisor and Islamic scholar for guidance specific to your retirement plan and personal circumstances.