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Starting off 401k

Assalamu alaikum,

I’m a college student, soon to graduate and working at a company as an intern this summer. They’ve offered for us to enroll in a 401k plan where they have a pretty good matching rate, and since there’s a decent chance I might be able to return to work here full time, I’d like to start that up.

The issue is, until there’s $10k in an individual’s account, one is not allowed to go and select their own stocks or specific funds to invest in. They do, however, give us the option of selecting from their different index and growth funds. For example, this one is probably the best I’ve found in terms of its holdings being Sharia compliant, but still there’s a good portion of them that are not:

I’m just looking for general advice on how to go about this, is the best option to go through all the holdings and just mark off percentages and do all the math to figure out how much might need to be purified? Are there other components that impact the permissibility of investing in a growth fund like the one I’ve listed? And should I divide up into a couple different funds they’re offering, or just put 100% into the one that’s the “most Sharia compliant?” As of right now my intention is to invest mostly into this fund I’ve linked above and once I hit $10k, to switch into Islamic ETF’s if possible.

I’d appreciate any thoughts or resources on the subject, jazakAllahu khayran!

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Read my new post: My Journey 401K to IRA Investment. It will help you if not today then in the future.

Congrats on the internship brother and coming graduation.

Short advice: Do the 401K to get the free matching contribution. Rest is secondary.
2) Hit the 10K limit first
3) You have a long horizon.
4) You can check each fund components to see which is closest to compliance. However, if you want to list the fund names, someone can help and see if there are any great choices.
5) Generally, it is good to diversify a bit among value and growth, large cap and small cap and a bit of international. That would be my upper bound 5 funds. If choices are not great, you could do fine with 1-3 funds given you will keep saving and adding and then possibly invest via IRA and taxable accounts.

Good luck!

Interesting, I definitely need to do more research on IRA and how to start that up.

Pretty easy as long as you have earned income , you can contribute to a traditional irA. Roth IRA is also possible as long as you are within the income limits.

I do provide financial planning about 401k , IRA, and fund selection

Unfortunately, I can’t find one place that lists them all without being logged in through a company account, so it might be difficult to ask others to look through. Thank you though, this was very helpful and I’ll keep these points in mind.

There should be one page that has a list. You. An take a screenshot or write down the name / ticker symbol and share that. If they are public funds anyone can research them. We don’t need to access the page you are using


I am in a similar position where I have requested self-directed brokerage for over last year and the company is still working on it. I am wondering which might be least impermissible option for now.

  1. FXAIX
  2. ERASX
  3. FSMAX
  4. HIAOX
  5. FTIHX

Not including any bond or blend asset class.
Any advice would be greatly appreciated.

Walaikum Assalaam @Mtk ! Welcome to the Community.

So with regards to the 5 funds you’ve mentioned here, $FXAIX is currently in Zoya, and thanks to your suggestion we’re working on adding $ERASX and $FSMAX as well.

As for $HIAOX and $FTIHX looks like they include mostly international holdings so we will need to add more markets to our screener first before we can check those funds.

Has anyone seen these funds as options? What would ya’ll suggest?