For younger generations who have long looked to social media to learn new information, from cooking lessons to makeup tutorials, TikTok and Instagram are just the places to discover financial advice, according to new survey data from Credit Karma.
In fact, according to the recent study conducted by Qualtrics on behalf of Credit Karma, 56% of Gen Z and millennials intentionally seek out financial advice online or through social media, with more than half of Gen Z respondents admitting they have taken financial advice from someone they didn’t know online.
For footwear brands and retailers, the implications include keying into these generational cohorts’ desire for information about credit cards, incentives and rewards, as well as alternative payment options. And companies may want to reach them via social media and also team up with financial influencers.
In the Credit Karma research, Instagram was revealed to be the top social platform sought out for financial information by Gen Z — and second for Millennials, who were slightly more likely to turn to Facebook. Still, these advice seekers aren’t looking to just anyone. According to the report, 75% of those who have sought out financial advice say they follow specific social media influencers who create content relating to personal finance.
Moreover, 45% of those who have sought out financial advice from someone they didn’t know say they have put it in into action, and 69% of those who took advice said the advice they received made a positive impact on their lives. And nearly half of all respondents said they would be likely to share financial advice or information found online with friends or family.
“Finances are complicated for the majority of Americans,” said Colleen McCreary, financial advocate at Credit Karma. “It’s great to see so many young people are becoming more aware of their finances now and are taking steps to inform themselves on certain parts of their finances. That’s where technology and social media can be really powerful. However, it’s important that consumers do their research and verify the information they find online before taking action, especially when it comes to more risky advice, like investing in the stock market or in cryptocurrency. There are a ton of free resources online to help you cross-reference information you see on social media. At the end of the day, it’s your money and your financial future at stake.”
But what financial advice are Gen Z and millennials seeking out on social media? About 35% said they sought out budgeting or tax advice, respectively, while 29% said they were looking for advice about credit card debt. Nearly a quarter of respondents also said they were looking for advice on credit card rewards and points, investing in the stock market, home buying or opening a credit card/ bank account. Worth noting, said authors of the report, is an additional 22% of millennials who said they received advice on investing in bitcoin or crypto.
Overall, the report points to younger generations’ confusion about investing, filing taxes and credit score factors and a list of personal finance topics, like 401K versus Roth IRA options and stock market investments, that are seen as “daunting.”