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Financial content on social media: Financial friend or foe?
Social media is an everchanging landscape with new platforms arising often and a varying level of attention on each. Recently, TikTok has gained traction due to its wide range of content, personalized algorithm, with no shortage of users, 1 billion monthly users, to be specific. The short-form content platform has become a partner to financial content creators like Humphrey Yang (2.7 million followers) and Graham Stephan (285.1k followers).
Americans turn to social media for financial guidance
A recent 2021 survey released by NAPFA found that more than one-third (39%) of Americans under age 65 receive their financial advice online or from social media. And one-fourth of Gen Z Americans receive their financial advice from social media. Of those respondents who find their financial advice online, 60% say they have acted on the information. This begs the question: is social media a financial friend or foe?
While it is exciting to see young people more engaged in their finances and content writers creating financial articles, turning to social media personalities instead of a trusted financial professional can lead to misinformed decisions. Taking advice not relevant to your financial situation can cause unnecessary risk and potential harm if the information is inaccurate.
Not feeling prepared for retirement
The same survey found that over one-third (34%) of Millennials and Generation Z Americans say that a lack of financial guidance harms their ability to prepare for retirement, with the concern increasing with age. 34% of Millennials feel the most unprepared, with Gen Z close behind at 30%.
Only 22% of Millennials and 19% of Gen Z respondents have retirement savings in an IRA, while 35% of Baby Boomers and 23% of Gen X claim to have an IRA. Many individuals are even considering side gigs to boost contributions to retirement savings.
Different generations, different attitudes toward money
Gen Z receives most of their financial advice via social media from YouTube, TikTok, and Instagram, while millennials get their information from YouTube, Facebook, and Instagram. The data shows people are looking for trustworthy financial information in a streamlined and easy-to-digest format. The data also indicates that they feel left behind or neglected by financial institutions.
If you are a financial professional, now is a great time to subscribe to our content marketing subscription package. We provide you with the social media tools to show you provide the financial advice that Americans seek. Having a presence on social media with relevant financial content helps position you as the trusted expert that can help solve their financial and retirement savings problems.
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