Understanding Nisab.
Nisab is the minimum amount of wealth a Muslim must possess before they are obligated to pay Zakat. It ensures that Zakat is only paid by those who have the financial means.
Current Nisab Values
Based on today's global spot prices for precious metals.
The Gold Standard
Based on the value of 87.48 grams of pure gold.
Used primarily when a person's wealth consists entirely of gold.
The Silver Standard
Based on the value of 612.36 grams of pure silver.
Most scholars recommend using the silver standard for cash and mixed assets, as it benefits the poor by creating a lower threshold for Zakat eligibility.
Which standard should I use?
In the time of Prophet Muhammad (PBUH), the values of gold and silver were roughly equivalent, meaning both Nisab thresholds represented the same purchasing power. Today, the gap between the two metals has widened significantly.
If you have only gold, you use the gold Nisab. If you have only silver, you use the silver Nisab.
If you have cash, stocks, cryptocurrency, or a mix of assets, the vast majority of contemporary scholars advise using the Silver Nisab.
Using the lower Silver threshold ($485) means more people qualify to pay Zakat, resulting in more wealth being distributed to those in need.