Along with the rising cost of living, FinTok, an online world of personal finance advice, has emerged.
From breaking down the (old) mini-budget to navigating the dark realms of crypto, and even the best apps to invest with, Financial TikTok is populated with content creators offering their advice on how to survive the cost of living crisis.
It’s not the first time people have turned to the platform for help, with budget recipes and energy saving tips (including showering at the gym) has gone viral in recent months.
But as the cost of living increases, this new side of the application grows with it.
Beyond the viral dances, cat videos and feta pasta recipes that have made it so popular during the pandemic, Ofcom research shows TikTok is one of the top three news sources for teens – up there alongside Instagram and YouTube.
From candy to school four figures per month
Poku Banks started out as an entrepreneur selling candy at school, but turned his personal finance degree from the University of Nottingham into a source of income, sharing tips with his 341,100 TikTok followers.
Now, he said, he can earn up to four figures a month from the platform, sharing tips including; the best ways to finance a vacation using investments, tips on car financing or how to use the first week as an entrepreneur.
With 41% of users between the ages of 18 and 24, TikTok is particularly popular with Gen Z.
“Growing up, Gen Z, we have short attention spans and that’s life,” he said, explaining why he prefers to condense complex topics into short videos.
A study by One Poll in October 2022 of 1,046 teenagers and 2,050 adults found that 60% of people now choose social media as the best place to get financial advice amid the cost of living crisis.
People aged 12 to 17 said they got their best money-saving tips from TikTok and said they valued this kind of advice much more than what they got from their parents or school. school.
As a result, more than a third of the age group say they have set aside between £100 and £500 in personal savings from tips.
A TikTok spokesperson said: “TikTok is a place where millions of people come to be entertained, but also to learn. As more and more people seek financial information online, it is important for us to help our community access the right support and advice on TikTok, especially if they have trouble accessing it elsewhere.
“We’ve long partnered with Citizen’s Advice to produce informative videos and our #FactCheckYourFeed campaign. More recently, we launched a new cost of living hub – to bring together all the best advice from our community and help people to make the right financial decisions for their.”
“Wealth Brothers”
A quick search under the hashtag #stocktok shows videos of creators doing “thousands of seconds” and promising “stocks that will make me rich in 2023”.
Laura Pomfret of Financielle said: “If people in our community ask us, should I invest in cryptocurrency, I would say, well, that’s entirely up to you, but let me tell you what. is cryptocurrency, I’ll tell you what some of the risks are so you can make your own decision.”
But with anyone able to create an account and upload videos – and no real formula for what gets attention and goes viral – there are concerns about navigating the platform and the safety of following. some of the instructions.
“I’m worried. On my For You page [TikTok’s personalised homepage] yesterday a ‘wealth bro’ from America said you should finance a car and invest that money instead,” Laura said.
“[He was] promising returns that won’t happen, and when I see stuff like that, it makes me uncomfortable.”
Searching for financial hashtags brings up a disclaimer from TikTok, reminding users that “all investments involve risk” and to never disclose personal information on the app.
It also gives advice on how to recognize if something is a scam, alongside a TikTok from Citizen’s Advice.
“I like, all of us, don’t give financial advice,” This Girl Talks Money’s Ellie Austin-Williams told Sky News.
“And for a lot of people, that’s a real misconception. A lot of people are like, ‘well, I need a financial advisor on TikTok, to tell me what to do.’
“A financial adviser, no matter how qualified on TikTok, cannot tell you what to do.
“They’re not allowed to.”
“I will never sell you anything”
Like all social media platforms, Ellie said there was a “proliferation of scammers” impersonating her.
“It’s especially bad in finance,” she said.
“I will never sell you anything, I will never encourage you to trade.
“It’s just about having a bit of caution in mind that if something seems too good to be true, then it is.”
Poku added that all advice is based on their personal experiences, and while they “may nudge you in a way or direction that we think is best,” both use disclaimers on their content, warning users to only invest what they can afford, or reminding them that no investment has a guaranteed return.
Female overload
Less than 50 years ago, a woman could not open a bank account in her name. Now, women entrepreneurs are using their TikTok platforms to try to bridge this gender gap.
Laura Pomfret and her sister Holly Holland launched Financière in 2016 while Laura was on maternity leave.
Coming from a northern working-class background, the former lawyer said she was ‘just trash with money as a graduate living in the city, spending everything I earned’ because she ‘didn’t never had a financial education”.
“It’s kind of a concept of female overload, whether you’re a mother or a daughter or you’ve kind of been left out or those conversations, money seems overwhelming,” the mother-of-three said. .
TikTok, she said, appeals as a platform because you need to condense topics into short 60-second videos (although the app is now testing longer content, shorter videos remain among the most popular).
“We want things short and snappy, that can cut through the noise and say that’s how it is,” she said.
Amid the confusion of the past few months – with a mini-budget announced and then scrapped, two new prime ministers and several chancellors – Laura said: ‘There was a huge amount of economic terms tossed about, people saying ‘I’m trying to make sure I can pay my bills and I’m trying to figure out how much easing is or whether the interest rate issue is going to impact me or not’.”
“Everything was aimed at my parents”
Ellie, 35, says This Girl Talks Money’s target audience is 91% women and mostly Gen Z.
When she started researching personal finance, she was frustrated with how everything was aimed at “my parents’ age, rather than me” and thought that if more financial literacy was taught in schools, it would there might not be such a need for these online creators to fill the gap.
“What we need are mandatory sessions,” Poku added, though he was quick to caution that he didn’t blame individual teachers.
“Every adult is looking to invest, in a pension or themselves, we know we’ll have a credit card one day, but we’re not told about credit scores.
“So basically we’re thrown out into the world and we don’t know anything.”
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