Article Finfluencers: How to keep up with the changing face of financial advice

The face of financial advice is changing with the times. Financial influencers – otherwise known as ‘finfluencers’ – are becoming increasingly popular.¹

Social media has potentially made the industry more accessible for novices and first-time investors with age on their side – so how can advisers keep up?

This article will help support you through this new era for financial services, offering recommendations, tips and advice on how to rival this trend.

What are finfluencers?

‘Finfluencers’ are influencers that share financial advice on social media.² Popular on platforms like Instagram and TikTok, these content creators often cover complex topics surrounding investment or financial advice.

They’re gaining in popularity as their advice is engaging and accessible. It’s not complicated or confusing and is often in line with its target audience.

Sometimes, finfluencers jump on viral trends to deliver advice – using memes or videos to entertain and engage with a mass audience on tricky topics.

Who uses finfluencers?

Social media, especially video or reel-based platforms, is predominantly used by younger generations.³

Younger audiences may feel overwhelmed, alienated or scared by traditional means of financial advice – turning to relatable influencers on a platform they already feel comfortable with.

According to the Financial Conduct Authority (FCA), nearly two-thirds (62%) of 18- to 29-year-olds followed social media influencers, with 74% of those saying they trusted their advice.¹

Research by MRM, conducted in 2022, also found that a quarter of those surveyed went to financial advisers for their insight, and that traditional financial media only reached one in 10 of those under-30.⁴

It could be time to get on your audience’s level. Consider simplifying your offering in terms of how you present it to clients – both present, and prospective. Making your language around complex topics everyday and accessible could be key to attracting and securing a first-time investor as a long-term client.

Head over to our article on what Gen Zers want from financial advice for more tips.

What do finfluencers promote?

Financial content creators promote financial products and share advice. There are so-called crypto and digital currencies experts, as well as those who give advice on saving, investing, or even ‘get rich quick’ schemes.

As of October 2024, there were over 116.9k #FinTok tagged posts on TikTok, and over 257k posts for #StockTok – so the interest exists.

As an adviser, you could consider your social media presence. What do younger generations see when they land on your page, and could you make it more attractive, or engaging, for them?

Read our article on our insights hub asking if your marketing strategy is fit for a rapidly changing world for more advice.

Are there any risks to finfluencers?

While it seems this trend has brought an increased interest in finances amongst younger, perhaps once disengaged audiences, it comes with its issues.

According to the FCA, finfluencers’ promotions ‘target younger consumers who are likely to trust the information influencers provide them with’ – meaning that their advice isn’t likely to be risk-free.⁵

Like social media, this trend is in its infancy and isn’t regulated. Finfluencers may seem personable and trustworthy – but aren’t’ authorised by the FCA to give financial advice. ¹

Finfluencers making money on certain platforms may also hold advertising deals with certain companies and partners, too – unfairly representing the market.

As a result, young people may find it hard to determine a scam. Back in 2021, research by the FCA of 1,000 18-to-40-year-olds discovered that over half (58%) of those that had invested in high-risk assets had been directly influenced by social media – as well as the news and from other people.⁶

In 2023, the FCA said it helped to remove or change more than 10,000 misleading promotions and financial ads. There has been a reported 17% increase in removals year-on-year.² And, as of October 2024, the FCA has already brought charges against nine influencers for promoting an unauthorised trading scheme.⁷

Kate Smith, Head of Pensions at Aegon said: ‘People need to be very wary of so-called ‘finfluencers’ offering financial advice or guidance online, particularly if they are promoting products or so-called investment opportunities. Alarmingly an increasing number of young people are falling for these.’

Stress the importance of spotting a scam to your existing clients, especially younger generations. Remind clients that anyone can be a target, referring them to the FCA or Action Fraud if they feel like they’ve been a victim of one – from social media, or otherwise.

These reminders could sit on your website, or be stressed through multiple social media posts to attract the attention of younger potential investors.

How do finfluencers affect me?

The popularity of finfluencers could be detracting from your business – especially when it comes to younger generations, or first-time investors.

But keeping up with them, and other trends, could be an opportunity to help reshape and innovate traditional financial advice mediums in line with key audiences. It could attract first-time, or perhaps sceptical, investors from younger, once disengaged audiences.

Building long-term relationships based on trust will help reassure clients – at whatever age and stage in their life – that traditional mediums of financial advice are reliable, and in their best interests.