Is Social Media the New Financial Advisor?
By Stephanie Evans, originally published on March 2nd, 2022.
In 2021, 38% of Americans reported that they have worked with a financial advisor. Social media platforms, such as Youtube and TikTok, are known to create new trends and have become sources for a wide variety of information, ranging from fashion to intricate finance. A third of Americans said that they trust social media to help them make financial decisions. Financial Advisors need a certification to provide financial advice to their clients, but how does this verification transfer over to those giving financial opinions and projections through social media?
Scott White, a financial advisor at Ameriprise Financial, stated that even due to social media advice rising, education levels have stayed constant while financial questions have increased. Questions correlate to quick money trends displayed on social media in conjunction with questions of more fundamental accounts such as a 401K or Roth IRAs. Asking these questions do not only aid our decision making but can lead to critical thinking and financial success. Winnie Sun, the co-founder and managing director of Irvine, emphasized that “the key is to remember that bad advice is much more costly than good advice.” This advice asserts the importance of financial questions in the decision making process.
Understanding the market can help general populations increase financial knowledge and economic stability. There are not enough financial advisors in the industry and by sharing expertise, entire community’s will benefit. Since there is no regulation of this information online, there is a heightened importance for questions. Looking at multiple sources of information can create a greater sense of understanding and can give individual’s the confidence to make financial decisions. When young minds are able to immerse and educate themselves in finance and business, there is an opportunity for creating a better economic future. Learning and questioning the information around us and using these vital resources and new technologies is crucial. Although social media has increased its outreach, financial advisors are still important for economic stability and community welfare. The process of questioning aids in all areas of financial advice and trends, regardless of the source.
Thank you for reading this insight written by Stephanie Evans, an Associate in the Mel Rines Angel Investment Fund. To learn more about The Fund, please visit https://www.rinesfund.com/
Stephanie is a sophomore from Durham, NH who is pursing a degree in Business Administration with an option in Finance and a minor in Economics while also completing another major in Political Science. Stephanie has spent the past semester learning about the Private Equity space and recently got started working as a research assistant within the UNH Center for Venture Research. She joined Alpha Kappa Psi, which is the professional business fraternity on campus. Stephanie is enthusiastic about learning more about the different avenues and niche research areas within the field through the Rines Fund with real world experience.