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They call it FinTok (Financial TikTok). It refers to the world of online personal finance guidance offered by influencers and others happy to give it a go on TikTok, offering help and financial advice too, particularly when it comes to the younger generation.
Some of it includes easy tips like saving on your water bill by showering at the gym. Others offer advice on how to find extra streams of income. But how can you tell the difference between bad and good advice?
Cost of living crisis gives rise to ‘experts’
It initially became famous because it made people’s dance routines go viral. Then came the cat videos, followed by the wannabe chefs. But now the social media platform, TikTok, is offering a platform to influencers who believe they can offer households a financial tip or three to get them out of debt and make more money.
So, who are these influencers who are advising the predominantly Gen Z audience of TikTok? Many are American, but some of their advice can be universally used. Here’s a list of a few who have over a million followers:
@humphreytalks: Humphrey Yang has 3.3 million followers at the time of writing. Formerly of Wall Street ilk, he can explain complex topics by breaking them up into simple bite-size chunks that are very digestible and easy to follow. Recent topics he’s covered include ‘The number one wealth killer no one talks about’; ‘5 Money mistakes that the ultra-wealthy never make’; and ‘5 Realistic Side Hustles’.
@johnefinance: John Eringman has 1.3million followers on TikTok. He describes himself as ‘not your typical finance bro’. Recent videos include talks about ‘4 Money accounts everyone should have’; ‘Earn hundreds for no work’, where he talks about the benefits of high-yield savings accounts, and ‘Don’t fall into this trap’, where he warns against gambling.
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@pricelesstay: The young Taylor Price describes herself as a Gen Z money expert and highlights that most of this generation is constantly stressed about money. She offers practical tips in her videos, including ‘How to move on a budget’; ‘Financial hacks you need to know’, and ‘Get an 800 credit score’.
Should you trust these experts’ tips?
Dean McCoubrey, the founder of MySociaLife, an online safety programme in schools, says: ‘Many offer some phenomenal tips, but the challenge is distinguishing between those who offer good tips and those who offer the very average ones.’
McCoubrey adds that another thing you must consider is the motivation of the ‘money influencer’. Are they after fame, money and prestige, or are they genuine about what they say and the fact that they care about people’s purses?
He explains: ‘That’s the number one thing we teach to Gen Z. The first thing to do is to tell them to think critically. Ask yourself: “Who is saying it, when did they say it, what’s their reason for saying it, is this second-hand information?”’
McCoubrey says that the problem with watching videos on TikTok is that they are instantaneously consumed and automatic. ‘It’s a flick of the finger through a feed and we don’t often question the validity,’ he says.
So, should you, ultimately, take on their advice? McCoubrey says: ‘It’s a “yes” if they are financial experts but it’s a “no” if the whole reason behind what they are doing is to get more followers and they don’t have the experience to understand the market over time.’
Conduct your own research
McCoubrey says that if you want to keep an open mind about what an influencer says, you should do some research about the facts of what they are saying. ‘Take that advice, google it, and look at similar and conflicting pieces of advice. If we don’t look at opposing views, we can’t have a balanced view.’
Then the key is finding a real-life expert that you can consult about these ideas. ‘I’d take that information and go to a financial expert. I think TikTok is great for financial awareness, but it’s not something I would lean on.’
