Personal Finance Influencer Red Flags

Personal finance influencers share money tips and strategies with their followers through social media platforms, podcasts, and blogs. Millennials and members of Gen Z frequently turn to channels like TikTok, Instagram, Reddit, and YouTube when looking for ways to improve their financial situation. While getting free money tips from influencers can be a cost-conscious move, it’s important to know how to spot potential scammers, fakes, and frauds.

key takeaways

  • Personal finance influencers share money information and advice with their followers through social media channels, blogs, and podcasts.
  • Professional financial education or experience is not necessarily a qualification to become an influencer; many draw on their own experiences instead.
  • Financial advice offered by influencers may be free, but it may not always be accurate or appropriate to your individual situation.
  • Supplementing advice from influencers with guidance from a professional financial advisor can help you create a solid plan for managing money.

What is a personal finance influencer?

A personal finance influencer is someone who uses social media platforms to offer money advice and information to their followers. These are often ordinary people using their own experiences with money to help others solve their financial problems. While some influencers may have a background in financial services, such as working in banking or being a financial advisor, it’s not a requirement to become one.

Personal finance influencers create content related to different financial topics and provide it to their followers for free. This content can include blog posts, social media posts, podcasts, financial “printables” (downloadable PDF files that you can print), e-books, guides, courses, workshops, and webinars. Some of the most popular channels for financial influencers include:

  • tik tok
  • Instagram
  • Youtube
  • Facebook
  • Reddit

Influencers can also create their own blogs or websites to promote their content. They can monetize their blog and/or social channels in a variety of ways, including participating in affiliate marketing, running ads, selling digital or physical products, charging fees to access premium content, and creating sponsored content. Some influencers may also offer coaching services for a fee.

Who uses social media for financial advice?

Anyone can search social media for financial tips and advice, but it’s particularly appealing to younger adults looking for content that’s easy to consume and understand. A survey by the National Association of Personal Financial Advisors found that more than a third (39%) of Americans under the age of 65 get financial advice online or from social media, while more than a quarter of Gen Z get money tips through social media platforms

In terms of the most popular social media outlets for financial advice, here’s how they rank, according to the 2022 Investopedia Financial Literacy Survey:


As mentioned, young adults are also turning to Reddit and Twitter as innovative options for financial advice. Part of the appeal may lie in the fact that much of this information is offered free of charge. That may be more appealing to young adults, who would prefer to avoid paying the 1% or 2% annual management fee that financial advisors typically charge.

Another attraction is the relationship. A 20-something struggling to increase their income or pay off student loans can relate more to a 30-something who has successfully paid off debt with side hustle than a 60-year-old financial advisor with a seven-figure net worth. Similarly, women, people in the BIPOC community, people who identify as LGBTQ+, and people with disabilities may seek out personal finance influencers who share similar backgrounds rather than seek help from an industry that is still significantly lacking. diversification.

Using hashtags, such as #financialadvice or #moneytips, can make it easier to find content from personal finance influencers on social media.

6 red flags of personal finance influencers

Before taking advice from a personal finance influencer, it’s important to make sure the information you’re receiving is trustworthy and has proven authority and credibility. Keeping an eye out for common red flags can help you identify influencers who aren’t legitimate.

Here are some of the most common signs that a personal finance influencer may not be what they seem:

1. Promises that are too good to be true

Personal finance influencers who frequently use terms like “foolproof,” “guaranteed,” or “fail-free” may need to be taken with a grain of salt, as there are no absolute guarantees when it comes to money. Also, beware of any influencer who promises to help you “get rich quick” with minimal effort.

2. Hard sell

Genuine influencers are interested in helping their followers improve their financial situation first; any money they earn should come second. If you’re constantly bombarded with sales pitches, it could be a sign that an influencer doesn’t have your best interests in mind when giving you financial advice.

3. Lack of evidence

Influencers who claim to be making $100,000 a year doing side jobs, or who say they retired at 35, should be able to back that up. If an influencer can’t show you the receipts to prove how they achieved their success, she should approach their advice with a healthy dose of skepticism. It also does not hurt to look for a series of facts that the influencer cites in reliable sources such as the Internal Revenue Service (IRS) or the websites of the US Securities and Exchange Commission (SEC). Are they accurate, careful, and up-to-date?

4. Pushing too many paid promotions

Influencers can earn money through affiliate marketing or sponsored posts; this is quite normal. However, if they are constantly promoting products they haven’t used themselves or are writing sponsored post after sponsored post, it may be a sign that making money, not sharing genuine financial advice, is their primary motivation.

5. Many followers, but little engagement with them

An influencer who has hundreds of thousands, or even millions, of followers can look impressive. But it’s important to see how many of those followers actually engage with your content by liking, commenting, or sharing it. A high number of followers could be hiding bots instead of real readers.

6. Requests for money in advance

If an influencer asks you for money or gift cards before providing content, a product or a service, that could be a clear indication that what they are really doing is a scam.

Should I get financial advice from social media?

Whether you’re comfortable receiving money tips and advice from social media platforms may depend on how trustworthy you think that information will be. Social media influencers can provide financial advice for free, which is a plus if you’re on a tight budget, but shouldn’t necessarily be considered a substitute for advice from a financial advisor, financial planner, or certified credit counselor.

How can I spot scams?

A personal finance influencer who makes promises that sound too good to be true or asks you for money without providing any content or services could be a scammer. Watch out for anything that feels strange; In other words, trust your intuition and avoid influencers who give off the wrong vibe.

Can anyone offer financial advice online?

Technically, yes, anyone can share financial advice or information through social media channels, a podcast, a website, or a blog. However, whether that information is accurate and legitimate may depend on the person sharing it. Again, personal finance influencers often use their own experiences to inform the advice they share, which may or may not include professional experience in the financial services industry. Still, having a financial certification couldn’t hurt.

The bottom line

Asking the right questions can help you find the right personal finance influencers to follow. For example, ask yourself what motivates this person to share their money advice. Is it a genuine desire to help others? Or is it about making money?

If they are leveraging social media platforms to earn money as influencers, are they disclosing affiliate relationships and sponsorships? Are they transparent about how they earn their income? Can you back up your claims with verifiable evidence? Looking under the hood and kicking the tires can help you determine which tip deserves your attention.

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