The internet can be a great place to learn random life hacks and cry over anglerfish. But what about when it comes to managing your money?
According to new data from Intuit Credit Karma, 77% of Gen Z and 61% of millennials are turning to social media for financial advice. Millennials mainly seek out YouTube, Facebook, and Instagram for information, while for Gen Z, TikTok has emerged as an unlikely hub for financial advice, under the hashtag FinTok. Here, content creators such as @YourRichBFF and @JohneFinance have combined followings of millions with videos that offer tips on everything from credit card rewards to flight costs to 401ks, crunched into less than a minute.
Many finfluencers market themselves not so much on academic credentials or qualifications as on lived experience, with popular videos titles including “Money habits for a 6 figure net worth” and “How I manifested a million dollars.” Often the clips sound like solid money advice, but as is the case with anything online, if it sounds too good to be true . . . it often is.
@breakyourbudget Realistic habits that can help you reach a 6 figure net worth
♬ original sound – Michela – Break Your Budget
Some have discovered this lesson the hard way. Despite the popularity of online finfluencers, 39% of Gen Z and one-third (33%) of millennials say they will never take financial advice from social media or online ever again, and doing so has negatively impacted their lives. Mistakes and poor financial decisions can be costly. For 37% of Gen Z and a quarter (25%) of millennials, they have ended up in trouble (hello, IRS audit) after taking action on financial advice from social media or online. A quarter of Gen Z and 23% of millennials also admit they’ve been scammed by bad actors pretending to offer financial guidance.
“While social media platforms, and the internet at large, offer easy access to a ton of useful information people can adopt in their day-to-day lives, consumers should always do their research and verify the information they find online before taking action, especially when it comes to their finances,” says Courtney Alev, consumer financial advocate at Credit Karma. “There are a lot of bad actors and information out there that can end up causing a lot of harm to peoples’ financial lives.”
While it’s always best to check (and double check) the information you scroll past online, sometimes you can strike gold. In fact, 64% of Gen Z and 63% of millennials say that the financial advice they received from an influencer has made a positive impact on their lives. Just make sure to do your due diligence and don’t make a financial decision just because it is trending online.
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