Choosing a Shariah-compliant super fund in Australia

Applying Islamic screens to compulsory savings

Employers must pay the superannuation guarantee, 12% of ordinary time earnings from 1 July 2025, into a fund. A halal fund screens out conventional bonds, term deposits and companies involved in alcohol, gambling, weapons or excessive debt, replacing them with compliant equities, sukuk and real assets.

How does Salaam super apply the screens?

Salaam follows AAOIFI standards, with IdealRatings screening holdings and Dar Al Sharia in Dubai acting as Shariah Supervisory Board. It offers Defensive, Balanced and Growth options launched on 1 June 2024, and members can switch between them at no charge.

Trustee and custody arrangements

Salaam super is a division of the Russell Investments Master Trust, whose trustee is Total Risk Management Pty Ltd, AFSL 238790. Salaam Wealth Funds Management, formerly Crescent Wealth Funds Management, sponsors the division, and State Street acts as independent custodian.

Regulation of super funds

Public super funds are regulated by APRA, which runs an annual performance test on MySuper and certain trustee-directed products. Funds that fail must tell members. The ATO administers contributions, caps and the YourSuper comparison tool.

Super is preserved until a condition of release is met, usually retiring after preservation age, which is 60 for anyone born after 30 June 1964. Choosing a compliant fund therefore shapes decades of investment, not only the current year’s returns.

Which halal super products are open today?

Salaam is the most clearly available public option. Crescent Wealth Superannuation Fund members were transferred into the Salaam division of the Russell Investments Master Trust, and Salaam states its fund has invested compliantly for over a decade.

Hejaz Islamic Super and Pension offers Growth, Balanced and Conservative options, but Hejaz states it is reviewing the offering and has paused new members, with rollovers and redemptions delayed by late unit pricing according to a notice dated 20 August 2026.

Self-managed super as an alternative

An SMSF lets trustees choose every investment, including Islamic property finance from MCCA, Shariah-compliant ETFs and the MCCA Income Fund. SMSFs suit larger balances and engaged trustees, as they carry audit, administration and compliance obligations.

MCCA requires a company as SMSF trustee for its property finance, with maximum funding of 80% for residential and 75% for commercial property. Trustees must also follow limited recourse borrowing rules and maintain a written investment strategy.

Insurance inside super

Moneysmart explains that most funds provide default life and TPD cover to members aged 25 and over, but not automatically to new members under 25 or with balances under $6,000. Cover is cancelled after 16 months without contributions unless the member opts in.

Switching to a halal fund

1. Find your current fund, balance and any insurance cover through myGov or your statement.
2. Read the halal fund’s PDS, target market determination and Shariah certificate.
3. Check fees and whether the options suit your age and risk tolerance.
4. Arrange equivalent insurance before leaving a fund, if you need cover.
5. Join the new fund online and provide your tax file number.
6. Request the rollover through myGov or the new fund.
7. Give your employer the new fund details using a choice form.

Fees and documents

Common super mistakes

• Rolling over before confirming the new fund is accepting members.
• Losing valuable insurance cover when closing the old account.
• Choosing Growth options too close to retirement without considering risk.
• Keeping several accounts with duplicate fees.
• Assuming an ethical fund is automatically Shariah-compliant.

Comparing performance fairly

Moneysmart suggests comparing returns over five years or more and between similar options. Shariah-screened options exclude bonds and many financial companies, so returns can differ markedly from conventional balanced funds in any given year.

Can non-Muslims join Salaam super?

Yes. Salaam states that membership is open to people of all backgrounds. Anyone who wants an ethically screened portfolio that excludes interest, alcohol, gambling and weapons can join, provided the product suits their circumstances according to the target market determination.

Is the super guarantee itself permissible?

Contributions are compulsory by law, so scholars focus on how money is invested. Choosing a Shariah-screened option is the practical step within the member’s control. Any small residual non-compliant income may be purified by donation if the fund advises it.

What happens to Hejaz members during the pause?

Hejaz says existing members can continue contributing and use the member portal, while new memberships are paused. Members considering withdrawal should read the latest significant event notice and ask whether rollovers are currently delayed before acting.

Do halal funds pass the performance test?

The APRA performance test applies to MySuper products and some trustee-directed products. Members should check their fund’s latest notice. A failure notice obliges the fund to inform members, who can then compare alternatives using the ATO’s YourSuper tool.

Planning contributions efficiently

Salary sacrifice and personal contributions can boost balances within annual caps. Exceeding caps creates extra tax, so check current limits on the ATO website. Compliance with Shariah rules does not change the tax treatment of contributions.

Preparing for retirement phase

Salaam’s iQ Retirement offers account-based pensions with three Shariah-compliant options, including transition to retirement strategies. Checking how the accumulation fund links to a compliant pension product avoids being moved into conventional options at retirement.

Reviewing your super every year

Read the annual statement, check fees, insurance and investment option, and confirm the Shariah certificate is current. Super runs for decades, so periodic reviews matter more than a one-off decision when first starting work.