The Children’s Mutual
Shariah Baby Bond® is designed to meet the needs of Muslim parents
and children living in the UK. It’s currently the only stakeholder
Child Trust Fund account that respects the requirements of Islamic
Shariah Law.
At The Children's Mutual we
recognise that parents of Muslim children need a Child Trust Fund
(CTF) that takes their beliefs into account.
That's why we’ve combined our expertise with the knowledge of a
specially appointed Shariah Advisory Board to create the Shariah
Baby Bond® Child Trust Fund account - which invests in a fund that
only holds shares in companies that comply with Shariah
law.
Shariah Baby Bond® Child Trust Fund is a stakeholder Child Trust
Fund account. So it also includes all the government’s required
features for stakeholder accounts, which are designed particularly
for people with little or no experience of investment linked to
company shares.
Features include:
- Greater potential for longer-term growth by linking investment
to company shares
- Investment reflects a range of shares to spread exposure to
risk
- A built in feature to limit the effect of share prices falling
in value as your child's 18th birthday approaches
- Tax efficient investment growth and payout at 18
- Charges are capped at 1.5% of the fund's value each year
What's more, Shariah Baby Bond® Child Trust Fund also
offers:
Not ready to apply?
Please remember that because Shariah Baby Bond® investment
is linked to shares, the value of the account could fall as
well as rise, and your child may get back less than has been
invested. No-one can access the money except your child, and not
until age 18.
The aim of Shariah Baby Bond® Child
Trust Fund is to build up a tax-free lump sum for your child when
they reach 18. This can then be used for whatever they choose –
maybe to help fund further education, buy their first car or to
travel the world.
Investment adhering to Islamic law
Shariah Baby Bond® Child Trust Fund fully adheres to Islamic law
by investing mainly in a fund that holds shares only in companies
that are listed on the Dow Jones Islamic Market Index. The fund
(and any investment made outside the fund) is approved by our
Shariah Advisory Board for this purpose.
This means that no investment will be made in any organisation
involved in:
- pork related products
- alcohol
- weapons and defence
- conventional financial services
- entertainment
More details of the fund can be found in the document below.
Getting a great return on your investment
The Children’s Mutual, like the government, believes that shares
should produce better returns in the long-term than cash savings.
That’s why our Shariah Baby Bond® CTF, which runs for 18 years, is
based on investment in shares. However, past performance is not a
guide to the future and your child could get back less than has
been paid in.
Protecting your investment
Investing in individual shares carries more risk than spreading
investment over a wider range of companies. That’s why Shariah Baby
Bond® Child Trust Fund invests in a fund that aims to match the
performance of an index including a wide range of Shariah compliant
company shares, rather than just a few.
And, if the price of shares is lower in the early years, any
money that you add to your child’s CTF account will be able to buy
more shares in the fund – meaning that the account will have a
better potential for growth should share prices start to
rise.
The Children’s Mutual will gradually move the money in your
child’s Shariah Baby Bond® to lower risk investments (such as
government bonds and cash) from your child’s 13th birthday. This is
called lifestyling.
Tax efficient investment
Under current regulations,all investment growth in your child’s
Child Trust Fund, as well as the lump sum payout at 18, are free
from personal taxes.
Low charges
Another benefit of the Shariah Baby Bond® Child Trust Fund is
that there are no hidden charges. There’s just a simple, fixed
administration charge of 1.5% of the account’s value each year,
already allowed for in the price of shares in the fund.
Your relationship with
us and information about Shariah Baby Bond®
PDF, 367KB (opens a new window)
How to get the
most from your child’s CTF
Shariah Advisory Board
Below you’ll find details of our specially appointed Shariah
Advisory Board who have helped design our Shariah Baby Bond® Child
Trust Fund account, and approved the fund it invests in.
Sheikh Nizam Yaquby
Sheikh Nizam is a member of the Shariah Committee for several
Islamic financial institutions. He has a MSc in Finance (Canada)
and is based in Bahrain. He has been a Professor of Tafsir, Hadith
and Fiqh in Bahrain since 1976 and is the author of several
articles on Islamic finance.
Dr Muhammed Imran
Dr Muhammed has a PhD in
Islamic Finance. He has also obtained degrees in Islamic
Jurisprudence from Karachi. Dr Muhammed is a faculty member of
Jamia Darul Uloom, Karachi and Institute of Business Administration
(IBA), Karachi as well as the author of various books of
Shariah.
Mufti Abdul Kadir Barkatullah
Mufti Abdul is the Imam at the North London Finchley Mosque. He
acquired a Mufti (diploma) in Islamic law and Fazil (Bachelor of
Islamic Studies) from the Islamic University, India. He also works
as a supervisor at the Islamic helpline for Fatwa and as a
presenter at Vectone Urdu.
Mufti Muhammad Nurullah Shikder
Mufti Muhammad is a Barrister at Law. He received a LLB (Hons.)
degree from London Guildhall University. He deals with reviewing
and drafting Shariah documents and advises individuals and
businesses on general Islamic finance.