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People interested in learning more about money probably won’t turn to social media for answers. In a recent GOBankingRates survey of money expertise, 44% of 1,001 Americans surveyed said social media was their least likely source of financial advice.
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Only 19% of Americans surveyed said they had used social media platforms – for example, YouTube, Twitter and TikTok – for financial advice in the past year. While social media can be a fantastic tool for increasing your financial literacy, it can sometimes be difficult to determine which online influencers are genuinely credible versus those who may be spreading misinformation.
Here are the red flags and green flags to look out for when using social media platforms to find trusted experts who can teach you about personal finance.
Look for certified experts
A large audience should not be the key indicator that someone is a financial expert. If you want to know more about the legitimacy of a TikTok or YouTube financial expert, take a moment to visit the website or LinkedIn profile and learn more about the person’s financial background. Ideally, there should be a match between previous work experience and current expertise.
Cecil Staton — President and Wealth Management Advisor at Arch Financial Planning – said a green light is an influencer with a formal education, such as CFP certification marks. Staton said another positive indicator that the expert has an understanding of financial literacy is if the person is quoted or referenced by other credible sources in the media.
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Find detailed content
Another sign that someone is knowledgeable about finance is that the person will create an in-depth video or blog post on financial topics.
These videos and articles will break down beginner, intermediate, and advanced levels on topics ranging from investing to retirement strategies. It may take a little longer to watch or read, but it should answer some important questions.
See how experts respond to their community
One of the simplest green flags that shows experts are listening to their audience is how they respond.
If viewers leave comments on YouTube or TikTok, influencers can answer those questions directly. In situations where there are too many questions or multiple repeated questions, they can make videos or create content that specifically answers those questions. It may not be the best idea to take the advice of those who aren’t listening or trying to understand their audience’s issues.
Reconsider following anyone trying to sell something
An important red flag to avoid is following anyone who tries to sell you certain products or promote their own courses or products.
If most of the content does not provide value to the audience but tries to promote personality products or sell unrelated products, reconsider following that person or using the person for advice. financial literacy.
Do the experts follow their own advice?
When using social media to learn more about money, it’s important to follow influencers who explain the “why” behind their recommendations.
Personal finance influencers should do what they advise their followers to do. If you follow an influencer who posts content about why you should budget but regularly shares photos of expensive purchases in Instagram Stories, the influencer may be contradicting their own advice.
Additionally, it’s a good idea to follow influencers who have a track record of high performance. They can share stories about surviving a previous bear market, recession, or other period of inflation. Surviving this financial downturn gives them the opportunity to share valuable insights into the current economic climate and better explain the “why” behind their recommendations.
Do experts recognize mistakes?
It’s easy to make mistakes or underestimate something in finance. You might think you’re investing in the next big thing and it turns out to be a dud. A red flag is an influencer who does not admit their mistakes. A green flag is someone admitting they were wrong.
In addition to being honest when a mistake is made, the most trusted personal finance influencers understand that market conditions change. When the facts change, their opinions can change to ensure better practices in everything from investing to saving. Keep an eye out for financial experts who understand that change is happening and are flexible in changing some of their own opinions to follow the market.
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