Tik Tok: The New Financial Advice Frenzy

Fondly known as the platform to go to for trendy dance routines, Tik Tok is now grabbing viewer’s attention as the latest source for financial advice. Nearly half of Generation Z (those born in 1997 and up), turn to Tik Tok for investment information according to a survey conducted by the LendingTree Magnify Money unit.

“There are very few educational resources about personal finance that are accessible and compelling to young people,” says Tim Sheehan, co-founder, and CEO of Greenlight. “So it isn’t surprising that kids are turning to social media. TikTok, in particular, provides quick, digestible content that can instantly capture your attention,” says Mr. Sheehan. However, he adds, “Misinformation dominates social media and it can be very difficult to discern the facts.”

The approachability and relatability factor draws younger viewers in, with more complex matter simplified to visually deducible steps in Tik Tok form. While the trend is well received by the youth, financial advisors are concerned by the accuracy of information portrayed by influencers, many of whom have no financial background or education. Some TikToks contain misleading or false information, make overly optimistic assertions about investment potential, or include overly generalized statements that could lead to the major financial detriment, according to financial professionals and users who have encountered these types of Tik Toks. Claims of fail-proof, high-risk investment moves and blanketed advice on rental properties and loans may lead young Tik Tok viewers to financial harm, concerning financial experts. Tik Tok warns audiences to remain cautious in its financial-related hashtags pages like #fintok, with more than 296 million views, which states, “Before following any financial advice, keep in mind that all investments involve risks and consider doing your own research.”

Regardless of the potential negative outcomes, those in their 20’s and 3o’s say they find it useful in learning relevant skills and knowledge they didn’t learn at home or in the classroom. Teaching children financial literacy, retirement, buying investment properties and budgeting are among the most popular topics that young professionals want to learn about in a quick time frame.

 21 year old influencer Taylor Price produces content to 1 million Tik Tok viewers, on subjects like tax strategies, summer side hustles, and renting versus leasing. As chief executive of TAP Intuit, financial-education platform targeted towards Gen Z, Taylor puts research and data into her videos, but still encourages her audience to do their own due diligence. In the current crypto frenzy, many Tik Tok users follow financial advice learned from influencers like Taylor Price and Robert Shields, also known as stock_genius on social media.

Ultimately, finance-related social media content should be used to capture trends and spark interest to then research on your own, using reputable sites. Generation Z shows us that creativity and learning reach new heights in the Tik Tok era-one minute you are hitting the latest dance and the next you are on your way to becoming a stock trade expert.

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