READY 80% of young people say they turn to social media for financial advice. But maybe they should find another source.
A new one report from Social Capital Markets found that 71% of financial advice consumed by Gen Z and Millennials is misleading and only 13% of influencers had the relevant qualifications and credentials to advise on financial matters. This past summer in the UK, for example, some social media influencers were accused of promoting financial schemes to millions of followers.
The study analyzed 2,470 TikTok, YouTube, and Instagram videos and related hashtags (#StockTok, #Investing, and #Stocktips), looking for “hoax” posts that have key items, including no disclaimers, encouraging viewers to invest in specific assets and implying guaranteed returns.
Related: Here's how much an influencer with 21 million followers on YouTube, Facebook and TikTok earns
Of the videos analyzed, 83% had no disclaimers and offered “a one-sided view of financial decisions,” according to the report. Meanwhile, 57% of the stock content implied guaranteed returns.
Social Capital Markets
TikTok, Instagram and YouTube had the most fraudulent posts
According to the report, TikTok was named the platform no. 1 most dangerous, with 91% of videos having no disclaimers and 70% encouraging stock purchases.
Instagram was found to be the second most problematic, with 88% of financial videos lacking disclaimers and 65% encouraging specific stock investments.
YouTube came out as the third most misleadingly posted platform, known for being “aggressive in promoting specific stock picks,” with 76% of posts not including a disclaimer and 75% promoting specific investments.
Related: How to make TikTok work for your business
Why was TikTok considered the most dangerous platform for financial advice?
In addition to the high number of videos that did not have disclaimers and encouraged stock purchases, the analyzed TikTok videos also had a high percentage (65%) of content that implied guaranteed returns, while 50% encouraged viewers to invest a share certain of their income.
