Bitcoin, gold, mutual funds, ETF's, index funds, bonds, real estate... all of them? Where should we invest our money? We want our money to be growing faster than inflation and we want it safe! I get it.

Without discounting the individual merits of any of these investment choices, or the importance of diversification among asset classes, I will argue that none of them, individually, or within a well diversified portfolio, come even close to Judaism’s prescribed investment that no financial guru ever told us about: maaser – tithing!

For years I subscribed to the normative personal finance rules of four ways to allocate our money: save, invest, spend and give. The last one – giving – being last because it’s what one would take care of after everything else. If there’s extra, then, of course we give. Or so I thought.

Up until the last recession, when my financial life took a big hit, I had assumed that I was a pretty generous person. Only then, did I begin to understand that Judaism flips this financial paradigm on its head. Jews give first.

The mitzvah of maaser, or tithing, demands us to give 10% of our after-tax income to those in need, regardless of our other allocations. We take care of the giving first! Money comes in, 10% goes out. And while this ensures that we are charitable and givers regardless of our income level, I’ve come to realize that this mitzvah is as much about giving as it is about investment math and financial acumen.

When the Talmud discusses the Torah verse “Aser te’aser” – “you shall set aside a tenth,”1 it explains, "Give a tenth in order that you will become wealthy."2 That made me curious.

The Talmud narrates numerous stories showing how those who are strict about maaser become wealthy, and those who aren't lose their wealth. There’s nothing random about the gains or the losses, and the math is quite precise. As Rabban Gamliel used to warn: "Do not tithe by guesswork..."3

If the tithing happens after everything else got allocated, it’s very unlikely that my contribution will end up being a precise 10%. Savings and investing aside, I sure know how to take care of those expenses! Moreover, most of us overestimate how much we give (and we also tend to underestimate how much we spend) and when we do the math, we might shockingly realize that we don't even come close to giving 10% of our annual income.

Our 90% is a security backed by God Himself! This is the only mitzvah in which we are allowed to test God.

This investment presupposes a 90-10 partnership with God, the Source of all money. Throughout this partnership we get 90% and God gets 10%. Moreover, our 90% is a security backed by God Himself! He says, "Test me on this!"4 In fact, this is the only mitzvah in which we are allowed to test God. Talk about sure gains!

But there's one caveat. The moment we skirt our obligation as “wealth managers,” the roles of the partnership swap. Our Partner – God – now keeps 90%, and we get 10%. Yes, the Talmud explains that when we do not tithe the income that God gives us, we will receive just the tithe! That’s a risk I’m not willing to take.

The Talmud narrates the story of a rich man who owned a field. This field produced a thousand kor (think of it as tons) annually. Thus, every year, following the Torah precept of tithing, the separated 100 kor as tithes. Upon his deathbed, he called his son to give him final instructions: “My son, know that this field that I am giving you for inheritance yields a thousand kor every year. Make sure that you will separate 100 kor as I did throughout my lifetime.” The rich man then passed away.

His son was now the owner of the field. Just as his father had told him, it yielded 1,000 kor. Dutifully, the son-turned-businessman separated 100 kor. The second year, however, the tithe started feeling burdensome to him. “It’s too much,” he thought to himself. He did not tithe. To his dismay the next year, the field produced only 100 kor. He mistakenly thought he’d been saving himself some money, and look what happened.

The Mishnah states that "maaser is a fence."5 For indeed, giving maaser protects our wealth.

Implementing Judaism’s system to protect your wealth and ensure your return is quite simple. Here are a few steps you can take:

  1. Open a separate bank account: The most important step to do this correctly and avoid any mistakes is to open a separate bank account. Make sure it’s one that is free and allows you to easily make transfers.

  2. Make those transfers: Now all you have to do is either automatically, or manually, transfer 10% of your after tax earnings into that account, without fail.

  3. Give regularly: You will now be able to send money to those in need easily from that account. This will be the one account that you’ll love emptying out. Additionally, you will now always be in a position to give, regardless of how much you’re earning. And there’s no better way to feel rich, like when we give.

  4. Use a spreadsheet (optional): If you want to be extra organized, keep a spreadsheet with one column for earnings and one for donations, which you update regularly. It will make the next step much easier.

  5. Make an annual accounting: Decide ahead of time if you will do your accounting based on the fiscal year, or the Hebrew year. Either way, right before the end of the year, calculate your entire earnings for the year and your giving. Make sure the giving added up to 10% of your after tax income for the year. If you "owe" maaser, then send the amount to charity right away. If you “over-gave”, then smile, and discuss with an expert on Jewish law how to account for this.

So, does it really matter whether you invest in Bitcoin, real estate, gold, or index funds? Yes, but only if you first and foremost are investing in the only investment that has guaranteed returns: maaser. Everything you do with your money beyond that will surely be blessed.

  1. Devarim 14:22
  2. Taanit 9a
  3. Avot 1:16
  4. Taanit 9a
  5. Ethics of Our Fathers 3:17