Muslims use strict investment guidelines

What do Anheuser-Busch, Playboy and Bank of America have in common?

They are forbidden — or haram — stocks for the Amana Funds, an $81 million-asset mutual-fund family in Bellingham that invests according to Islamic principles.

The funds stay away from alcohol, pornography, tobacco and gambling, just as observant Muslims do in their personal lives.

For many Muslims, U.S. banks fall into the same category, because Islamic law forbids borrowing or lending money with interest.

Investing in insurance companies is also off limits, because insurers invest in debt instruments like bonds. Even companies with too much debt are forbidden investments.

Since launching a marketing campaign in 2001, the Amana Funds has more than doubled in assets, catering to people who have few choices for investing in a financial system not geared to their beliefs.

Only a handful of U.S. mutual funds use Islamic principles, including Amana and funds managed by Allied Asset Advisors in Burr Ridge, Ill., and Azzad Asset Management in Falls Church, Va.

Many savers don’t check rates

When was the last time you checked the interest rate you’re getting on your checking account or basic savings account?

“A lot of savers are asleep,” said Jordan E. Goodman, author of “Everyone’s Money Book.” “Banks love it, because they don’t have to raise the rates on their standard accounts to keep the money because there’s so much inertia.”

If you have cash parked in accounts earning a fraction of a percent, it’s probably time to shop around for a better deal, he said.

Since the Federal Reserve began raising rates last summer, the yields have risen on many savings products including certificates of deposit and money market accounts. And rates are expected to rise further with more Fed tightening this year.

One of the safest alternatives is a money market account at an online bank, Goodman said.

“They often can pay more because they don’t have the overhead of brick-and-mortar banks,” he said. “And many don’t require minimum deposits or charge fees to open accounts.”

Arbitration favors card issuers

When consumers shop for a credit card, they’re looking for the lowest interest rate, no annual fee or the best perk, such as frequent-flier miles.

Few pore over the fine print of card agreements. If they did, they might see they agreed to settle disputes with the card issuer through binding arbitration, giving up the right to sue.

Since the 1990s, large card issuers have been adding arbitration clauses to card agreements hoping to stave off expensive class-action lawsuits. Supporters of arbitration say having a third party hear the facts and make a binding decision is a lot quicker and cheaper for both sides than going to court.

Consumer advocates, however, say arbitration overwhelmingly favors card companies that select which arbitration company will handle thousands of credit disputes each year.