Moderation in Spending
Allah enjoins moderation in living. He condemns miserliness and forbids extravagance.
وَلَا تَجْعَلْ يَدَكَ مَغْلُولَةً إِلَى عُنُقِكَ
And let not your hand be tied (like a miser) to your neck,
this means, do not be miserly and stingy, never giving anything to anyone, as the Jews - may the curses of Allah be upon them - said,
"Allah's Hand is tied up (i.e., He does not give and spend of His bounty)."
They attributed miserliness to Him, Exalted and Sanctified be the Most Generous Bestower!
وَلَا تَبْسُطْهَا كُلَّ الْبَسْطِ
nor overextend it (like a spendthrift),
means, nor be extravagant in spending and giving more than you can afford, or paying more than you earn, lest you become blameworthy and find yourself in severe poverty.
فَتَقْعُدَ مَلُومًا مَّحْسُورًا
so that you become blameworthy and in severe poverty.
If you are a miser, people will blame you and condemn you, and no longer rely on you. When you spend more than you can afford, you will find yourself without anything to spend, so you will be worn out, like an animal that cannot walk, so it becomes weak and incapable.
It is described as worn out, which is similar in meaning to exhausted.
As Allah says;
الَّذِى خَلَقَ سَبْعَ سَمَـوَتٍ طِبَاقًا مَّا تَرَى فِى خَلْقِ الرَّحْمَـنِ مِن تَفَـوُتٍ فَارْجِعِ الْبَصَرَ هَلْ تَرَى مِن فُطُورٍ
ثُمَّ اْرجِعِ البَصَرَ كَرَّتَيْنِ يَنقَلِبْ إِلَيْكَ البَصَرُ خَاسِيًا وَهُوَ حَسِيرٌ
Then look again;"Can you see any rifts" Then look again and yet again, your sight will return to you in a state of humiliation and worn out. (67;3-4)
meaning, unable to see any faults.
Similarly, Ibn Abbas, Al-Hasan, Qatadah, Ibn Jurayj, Ibn Zayd and others understood this Ayah as miserliness and extravagance.
It was reported in the Two Sahihs from the Hadith of Abu Az-Zinad from Al-A`raj that Abu Hurayrah heard the Messenger of Allah say;
مَثَلُ الْبَخِيلِ وَالْمُنْفِقِ كَمَثَلِ رَجُلَيْنِ عَلَيْهِمَا جُبَّتَانِ مِنْ حَدِيدٍ مِنْ ثُدِيِّهِمَا إِلَى تَرَاقِيهِمَا
فَأَمَّا الْمُنْفِقُ فَلَأ يُنْفِقُ إِلاَّ سَبَغَتْ أَوْ وَفَرَتْ عَلَى جِلْدِهِ حَتَّى تُخْفِيَ بَنَانَهُ وَتَعْفُوَ أَثَرَهُ
وَأَمَّا الْبَخِيلُ فَلَأ يُرِيدُ أَنْ يُنْفِقَ شَيْيًا إِلاَّ لَزِقَتْ كُلُّ حَلْقَةٍ مِنْهَا مَكَانَهَا فَهُوَ يُوَسِّعُهَا فَلَأ تَتَّسِع
The parable of the miser and the almsgiver is that of two persons wearing iron cloaks from their chests to their collar-bones.
When the almsgiver gives in charity, the cloak becomes spacious until it covers his whole body to such an extent that it hides his fingertips and covers his tracks (obliterates his tracks - or, his sins will be forgiven).
And when the miser wants to spend, it (the iron cloak) sticks and (its) every ring gets stuck to its place, and he tries to widen it, but it does not become wide.
This version was recorded by Al-Bukhari in the Book of Zakah.
In the Two Sahihs it is recorded that Mu`awiyah bin Abi Muzarrid narrated from Sa`id bin Yasar that Abu Hurayrah said;
"The Messenger of Allah said;
مَا مِنْ يَوْمٍ يُصْبِحُ الْعِبَادُ فِيهِ إِلاَّ وَمَلَكَانِ يَنْزِلَاانِ مِنَ السَّمَاءِ
يَقُولُ أَحَدُهُمَا اللَّهُمَّ أَعْطِ مُنْفِقًا خَلَفًا
وَيَقُولُ الاْخَرُ اللَّهُمَّ أَعْطِ مُمْسِكًا تَلَفًا
There is no day when a person wakes up but two angels come down from heaven.
One of them says, `O Allah, compensate the one who gives (in charity),' and
the other one says, `O Allah, destroy the one who withholds."'
Muslim recorded from Abu Hurayrah that the Prophet said;
مَا نَقَصَ مَالٌ مِنْ صَدَقَةٍ وَمَا زَادَ اللهُ عَبْدًا أَنْفَقَ إِلاَّ عِزًّا وَمَنْ تَوَاضَعَ للهِ رَفَعَهُ الله
Wealth never decreases because of Sadaqah (charity). Allah never increases a servant who gives in charity except in honor, and whoever is humble for the sake of Allah, Allah will raise him in status.
According to a Hadith narrated by Abu Kathir from Abdullah bin `Amr, who attributed it to the Prophet;
إِيَّاكُمْ وَالشُّحَّ فَإِنَّهُ أَهْلَكَ مَنْ كَانَ قَبْلَكُمْ
أَمَرَهُمْ بِالْبُخْلِ فَبَخِلُوا
وَأَمَرَهُمْ بِالْقَطِيعَةِ فَقَطَعُوا
وَأَمَرَهُمْ بِالْفُجُورِ فَفَجَرُوا
Beware of stinginess for it destroyed the people who came before you.
It commanded them to be miserly, so they were miserly;
and it commanded them to cut the ties of kinship, so they cut them;
and it commanded them to commit immoral actions, so they did so.