The 5 Different Legacies you can Build with Waqf
Did you know that establishing a Waqf is one of the best ways to make a donation sustainable? A Waqf is essentially an endowment wherein your donation is invested, and the profits are used to fund the causes you care about (for more on waqf, check out our article here).
However, did you also know that there are many different uses of a Waqf? Awqaf (which is the plural of Waqf) have been around for centuries and have taken on different forms to play a vital role in supporting various charitable causes and community development.
This article will showcase 5 different ways a Waqf can be used to benefit society.
1. Family Waqf
A family Waqf is established by a donor to benefit their family members and descendants.
The assets endowed generate income to fund the welfare and sustenance of family members, including education, healthcare and financial support.
Family Waqf reflects the strong sense of kinship and responsibility for the well-being of one's own family, ensuring their long-term welfare through the perpetuity of the Waqf.
This type of act supports the Prophet ﷺ’s teaching on maintaining family ties as an act of high virtue in Islam. The Prophet ﷺ said:
“Whoever would like his rizq (provision) to be increased and his life to be extended, should uphold the ties of kinship.” (al-Bukhaari, 5986; Muslim, 2557)
2. Religious Institutions Waqf
A popular type of Waqf is to support religious institutions and activities.
These endowments are dedicated to the maintenance and development of mosques, madrasas, Islamic schools, libraries, and other religious centres.
Religious Waqf plays a pivotal role in ensuring the availability of religious resources and spaces for worship, fostering a strong, religious foundation within the community.
3. Cultural Waqf
You can also use a Waqf to focus on preserving and promoting cultural heritage, arts and literature.
These endowments support initiatives such as museums, libraries, cultural centres and theatres.
Cultural Waqf not only preserves the rich, historical and artistic traditions of a society but also enables the development and dissemination of cultural knowledge and artistic expression.
4. Charitable Waqf
Charitable Waqf is the most common and well-known type of waqf.
They are established to address humanitarian issues and help the less fortunate. They are used to support initiatives such as poverty alleviation, aid, and healthcare.
Charitable Waqf plays a crucial role in providing essential services to the less fortunate and fostering social welfare.
5. State Waqf
Rulers and states can also create Waqf to benefit their citizens. For example, libraries, hospitals or public utilities can be created through state Waqf for citizens to benefit from.
The Ottoman Empire was known for its use of the Waqf system to fund many public works like water systems and bridges.
Final words
As we have explored, Waqf represents a remarkable manifestation of Islamic philanthropy. In turn, this allows individuals and communities to contribute to noble causes in a sustainable way.
This highlights the need to revive the use of Waqf, in its many forms, including family, religious, cultural, charitable, and state Waqf, to create long-lasting solutions for the betterment of our societies.
Risk Warning: Equity investments are not readily realisable and involve risks, including loss of capital, illiquidity, lack of dividends and dilution, and it should be done only as part of a diversified portfolio. Investments of this type are only for investors who understand these risks. You will only be able to invest in the company once you have met our conditions for becoming a registered member.
Please visit www.wahed.com/uk/ventures/risk for our full risk warning.
Risk Warning: As with any investment, a Wahed Invest Ltd investment puts your money at risk, as the value of your investment can go down as well as up. The tax treatment of your investment will depend on your individual circumstances and may change in the future. If you are unsure about whether investing is right for you, please seek expert financial advice.
Please visit www.wahed.com for our full terms and conditions
Maydan Capital Limited, trading as WahedX, is registered in England and Wales (Company No. 13451691), registered office: 87-89 Baker Street, London, W1U 6RJ, UK. Maydan Capital Ltd (FRN: 963613) is an appointed representative of Wahed Invest Ltd (FRN: 833225), an authorised and regulated firm by the Financial Conduct Authority.Wahed Invest Ltd. is registered in England and Wales (Company No. 10829012), registered office: 87-89 Baker Street, London, W1U 6RJ, UK and is authorised and regulated by the Financial Conduct Authority: FRN 833225.
Subscribe For More Islamic Finance Content
As with any investment, a Wahed Invest Ltd investment puts your money at risk, as the value of your investment can go down as well as up. The tax treatment of your investment will depend on your individual circumstances and may change in the future. If you are unsure about whether investing is right for you, please seek expert financial advice.
Wahed Invest LLC (Wahed) is a US Securities and Exchange Commission (SEC) registered investment advisor. Wahed Invest provides brokerage services to its clients through its brokerage partner Apex Clearing Corporation, a member of NYSE - FINRA - SIPC and regulated by the SEC and the Commodity Futures Trading Commission. Registration does not imply a certain level of skill or training. Wahed does not intend to offer or solicit anyone to buy or sell securities in jurisdictions where Wahed is not registered or a region where an investment practice like this would be contrary to the laws or regulations. Any returns generated in the past do not guarantee future returns. All securities involve some risk and may result in loss. Any performance displayed in the advertisements or graphics on this site are for illustrative performances only.
Disclaimer: Wahed Technologies Sdn Bhd ("Wahed") is a Digital Investment Manager (DIM) licensee issued by Securities Commission Malaysia (eCMSL/ A0359/2019). It is part of Wahed Inc. Wahed is authorized to conduct a fund management business that incorporates innovative technologies into automated portfolio management services offered to clients under a license issued pursuant to Schedule 2 of the Capital Markets Services Act 2007. All investments involve risks, including the possibility of losing the money you invest, and the track record does not guarantee future performance. The history of returns, expected returns, and probability projections is provided for informational and illustrative purposes, and may not reflect actual future performance. Wahed is not responsible for liability for your trading and investment decisions. It should not be assumed that the methods, techniques, or indicators presented in this product will be profitable, or will not result in losses. The previous results of any trading system published by Wahed, through the Website or otherwise, do not indicate future returns by that system, and do not indicate future returns that will be realized by you.
Wahed Invest Limited is regulated by ADGM’s Financial Services Regulatory Authority (“FSRA”) as an Islamic Financial Business with Financial Services Permission for Shari’a Compliant Regulated Activities of Managing Assets and Arranging Custody [Financial Permission No. 220065]. Our ADGM Registered No. is 000004971. Wahed Invest Limited utilises Abu Dhabi Commercial Bank as its banking partner/custodian
Wahed assumes no obligation to provide notifications of changes in any factors that could affect the information provided. This information should not be relied upon by the reader as research or investment advice regarding any issuer or security in particular. Any strategies discussed are strictly for illustrative and educational purposes and should not be construed as a recommendation to purchase or sell, or an offer to sell or a solicitation of an offer to buy any security. Furthermore, the information presented may not take into consideration commissions, tax implications, or other transactional costs, which may significantly affect the economic consequences of a given strategy or investment decision. This information is not intended as a recommendation to invest in any particular asset class or strategy or as a promise of future performance.
There is no guarantee that any investment strategy will work under all market conditions or is suitable for all investors. Each investor should evaluate their ability to invest long term, especially during periods of downturn in the market. Investors should not substitute these materials for professional services and should seek advice from an independent advisor before acting on any information presented. Any links to third-party websites are provided strictly as a courtesy. We make no representation as to the completeness or accuracy of information provided at these websites nor do we endorse the content and information contained on those sites. When you access one of these websites, you are leaving our website and assume total responsibility and risk for your use of the third-party websites.
