![]() ![]() ![]() “What these influencers are leaving out is the risks and understanding that are needed to manage those types of investments.” Financial Advice on Social Media Is a Boon for Historically Disenfranchised People “Gen Zers idolize influencers, many of whom are being paid to promote financial advice, such as advice about crypto,” Macksoud says. But that generational advice comes with a dose of caution. You don’t get that filtering online.”įalcon recommends depending on social media only for general education about financial matters, and then seeking in-depth advice from a certified financial professional.Ĭertified financial behavior specialist Cara Macksoud, managing director and CEO of the personal finance platform Money Habitudes, notes that younger people may be more inclined to follow advice dispensed by people from their own generation than from other generations. There are some things that I just can’t say, and for good reason. “Unfortunately, anyone can post anything online without consequence-including bad or inaccurate advice about money management,” says certified financial planner and certified private wealth advisor Rick Nott, a senior wealth advisor at LourdMurray. Half of the people surveyed say they’ve made money as a direct result of financial advice on social media, but 28% say they’ve lost money. Types of Advice Young Adults Receive on Social Media The two least commonly seen topics among those we surveyed were get-rich-quick schemes (11%) and borrowing money (7%). Using Social Media for Budgeting Advice, Not ‘Get Rich Quick’ SchemesĪs you’re browsing social media platforms, a flurry of financial topics pop up, such as stock and bond tips (the most common topic spotted by survey respondents, at 57%), recommendations about debt reduction or guidance on retirement savings. ![]() “I stress context because there are not many absolutes in personal finance.” Other platforms tend to offer much shorter content that often lacks context,” he says. “Both of these platforms allow people to provide context, which is extremely valuable when it comes to personal finances. Walsh recommends LinkedIn and Twitter as the best social media sources for reliable insights about personal finance. The use of financial advisors is comparatively rare (11%). Outside of social media, those surveyed primarily get financial advice from family (35%) and internet searches (33%). In the survey, just 31% of millennials and Gen Zers regularly check the experience and qualifications of people who supply financial advice on social media. But when it comes to something as important and complex as personal finances, it worries me because there is no one-size-fits-all approach,” he says.Īs such, social media can elevate bad, irresponsible approaches to achieving financial goals, particularly since someone dispensing financial advice might not be qualified to do so, Walsh says. “That means people can easily provide and access information. You just have to know where to look and how to distinguish between the two.” “Fortunately, good examples of sound financial advice on social media outweigh the bad. “Social media tends to get a bad reputation when it comes to personal finances, but that is extremely unfair,” Walsh says. For instance, if you follow the right folks on Twitter, you may find “valuable and diverse” information about personal finance, he says. On the other hand, certified financial planner Brian Walsh, manager of financial planning at online financial platform SoFi, doesn’t believe in discarding all personal finance information you come across on social media. “A big con from getting advice on social media is that the person offering the advice may not be qualified to do so.” “There are a few gurus out there that can speak to general advice, but the reality is that each individual is different and what applies to one person may not apply to another,” Falcon says. Should You Trust Personal Finance Advice on Social Media?Ĭhartered retirement planning counselor Jake Falcon, founder and CEO of Falcon Wealth Advisors, is skeptical about following financial advice spread on social media platforms. 50% have made money as a direct result of financial advice they received on social media.Reddit and YouTube are the most trusted platforms for financial advice.62% feel empowered by their access to financial advice on social media.76% believe financial content on social media has made it less taboo to talk about money.79% of Americans representing the millennial or Gen Z age groups have gotten financial advice from social media.But should millennials, Gen Zers or anyone else rely on social media to guide decisions about their money? Opinions among personal finance professionals are split. ![]()
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