The London Academy of Trading‘s research has shed light on the profound impact of social media on investment decisions among young adults in the UK.
A staggering 49% of individuals aged between 16 and 35 claim their investment decisions have been influenced by social media platforms. This figure is particularly significant when compared with the broader statistic, which states that 21% of UK adults have been swayed in their investment choices by social media.
Furthermore, 40% of social media users have observed an increase in ‘Finfluencers’ promoting investment opportunities, particularly on widely-used platforms like TikTok and Instagram.
The emergence and rapid rise of ‘Finfluencers’ on social media platforms are leading to an increased number of individuals, especially among the younger demographic, making investment decisions based on content viewed on these platforms. This trend is not restricted to young adults, as a broader spectrum of the population, approximately 21%, is also getting influenced.
Finance.co.uk’s Editor-in-Chief, Laura Rettie, remarked: “In the UK, any individual or organisation giving financial advice, including banks and experts like independent financial advisers, must first get approval from the Financial Conduct Authority (FCA). This approval is designed to protect you.
“When you’re on TikTok or other social media platforms, and you see people talking about how to get rich quick or where to invest your money, it’s important to be extremely cautious. No one is checking if these influencers are actually knowledgeable about personal finances or whether or not they’ve been authorised or regulated by the FCA.
“The FCA’s main job is to protect us from bad financial advice, so if you spot money advice on TikTok or other social media platforms, it’s smart to be very careful. Don’t believe everything you see unless it has the FCA’s seal of approval. It’s safer to verify and get advice from trusted sources or experts, especially when it comes to your finances”.
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