Should we trust TikTok, YouTube Finfluencers?


You’ve probably heard of finfluencers – the so-called financial influencers who post financial lessons and financial tips on social media. They have increased over the past two years thanks to platforms such as Instagram, TikTok and YouTube. A global pandemic forcing us to increase screen time, along with increased retail investment and the frenzy around meme stocks, have also helped propel finfluencers to digital fame.

It is easy to ignore such a phenomenon. After all, it is (mainly) young people who give out financial advice in the form of short catchy snippets on social media. But the rise of the finfluencer goes hand in hand with the democratization of finance. Making quality financial information more accessible is a good thing. The world of personal finance has long been primarily targeted at the middle class or already wealthy.

The catch, however, is that a lot of financial advice lacks substance or is even downright predatory.

Take that from someone who is often referred to as a financial influencer – a label I personally hate – for writing personal finance books and offering advice (based on extensive research and expert interviews) via the social media. Many influencers offer motivated and quality advice. However, the space is also full of people looking to make a quick buck.

It is essential that consumers – anyone who scrolls on social media – exercise good judgment. Finfluencer work is marketing, and marketing well done. It helps to understand the different strategies used by influencers to earn money.

For example, there are brand partnerships where you basically create advertisements for financial services companies to promote products. These posts should be disclosed with language such as “I teamed up with” and include #ad and #partner in captions and in photos. It’s a legitimate way for creators to make a living (full disclosure: I’ve made money from such partnerships), but the key is to be aware of those relationships.

Another way to monetize is to sell your own content, from courses, worksheets, and books to t-shirts, hats, and tote bags. And there are content deals with the social media platforms themselves if your audience grows big enough. None of this is downright problematic. But problems can arise due to a lack of transparency, regulation and references.

Bad financial advice is nothing new – scammers and scammers have long been working side-by-side with ethical financial advisers. But it’s everywhere now, and it’s increasingly up to us to do our due diligence and check who we trust. This is especially important when it comes to investing. Someone who doesn’t know you and has no idea of ​​your financial situation and goals can’t say for sure where you should put your money.

Whenever you come across financial advice online – watch out for those tantalizing promises to get rich quick or retire at 35 – take a moment to think about a few things.

First, audit their social media feed to see what the person is promoting. Seeing well-organized advertisements for products like payday loans should be a red flag.


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