Following the news that the FCA is cracking down on finance influencers aka 'finfluencers', Lily Megson, Policy Director at My Pension Expert responded on being wary of social media as a source for financial guidance.
Lily (pic) said: “It’s no secret that personal finance content on social media has exploded in popularity, with millions turning to platforms like TikTok, Instagram and Facebook for guidance, with mixed results.
“At its best, this content can serve as an engaging and accessible way to get an informative overview of certain fiscal concepts. But at worst, it can be ill-suited to the financial situations of those consuming it – or even just wildly inaccurate – leading people to poor financial decision-making.
“In a bid to drive following and engagement, many online creators treat their tips as gospel. But this ignores the simple fact that successfully tackling your personal finance planning is far from one-size-fits-all.
“People’s financial circumstances vary so hugely that guidance given on video viewed by hundreds of thousands just cannot reliably meet the needs of all watching. Take pension planning, for example. The financial priorities and therefore the retirement savings approach of a 55-year-old mortgage-free homeowner differ significantly from that of a 30-year-old new parent struggling with debt.
“So where can savers go from here? Firstly, if it helps you stay engaged with and on top of your personal finances and planning, then continue consuming it. Just take it with a considerable pinch of salt. And importantly, don’t act on it unless it comes from a 100% reliable resource, such as a government organisation.
“For a solution tailored specifically to your goals, consider independent financial advice. An advisor would take into account your unique financial situation, goals, and risk tolerance, and help you put together a plan for both shorter term financial goals (holidays, new cars, paying off a pay day loan) and longer ones (buying a home, saving for children, retirement planning).”
