36% of Americans now prefer social media over advisers for financial advice, raising risk concerns in 2025

In an era where digital platforms dominate daily life, a notable shift is underway in how Americans seek financial guidance. Recent surveys indicate that a significant portion—around one-third—of the population prefers turning to social media for advice on money matters over consulting traditional financial advisers. This trend underscores broader changes in consumer behaviour, driven by accessibility, immediacy, and the allure of peer-driven insights, but it also raises questions about the reliability and long-term implications of such sources.

The Rise of Social Media as a Financial Oracle

The appeal of social media for financial advice lies in its democratisation of information. Platforms like TikTok, Instagram, and X (formerly Twitter) offer bite-sized tips on everything from budgeting to investing, often delivered by influencers with large followings. A Gallup poll from earlier this year revealed that 42% of American adults under 30 rely on these channels for financial insights, a figure that climbs higher among Generation Z. This preference reflects a generational divide: younger demographics, accustomed to on-demand content, view traditional advisers as outdated or overly formal, while social media provides relatable, real-time narratives.

Yet, this shift is not without precedent. Historical data shows a steady erosion in trust towards conventional financial institutions following events like the 2008 financial crisis. By 2019, surveys from CNBC indicated that 99% of Americans managed their finances without professional advisers, often citing high fees and perceived conflicts of interest. Fast-forward to 2025, and social media has filled this void, with platforms evolving into hubs for financial education—or, in some cases, misinformation.

Demographics Driving the Change

Breaking down the data, the preference is starkest among younger cohorts. Reports from the Philadelphia Federal Reserve highlight that millennials and Gen Z are increasingly sourcing advice on saving, investing, and debt management from social media. A Forbes Advisor survey from last year found nearly 80% of these groups engaging with such content. This aligns with broader cultural trends: in a world of economic uncertainty, where inflation and rising living costs dominate headlines, quick tips on “no-buy” challenges or side hustles resonate deeply.

For instance, a Bankrate study from early 2025 noted that 16% of Americans prioritised investing more as their top financial goal, yet many feel unprepared for retirement. The National Association of Personal Financial Advisors (NAPFA) reported that over one-third of millennials and Gen Z cite a lack of guidance as a barrier to retirement planning. Social media steps in here, offering free, accessible content that traditional advisers might charge hundreds per hour for.

Risks and Realities of ‘Finfluencer’ Advice

While the accessibility is undeniable, the risks are substantial. Experts warn that not all advice on social media is created equal. The Consumer Financial Protection Bureau and similar bodies have flagged the rise of “finfluencers”—individuals who leverage popularity to influence financial decisions, sometimes with self-serving motives. A TSB survey from July 2025 found that over half of those who acted on social media tips lost money, particularly among 16-24-year-olds, where 42% reported using these platforms for advice in the past year.

Bankrate’s analysis earlier this year labelled trusting social media for financial advice as “a terrible idea,” pointing to the lack of regulatory oversight. Anyone can pose as an expert online, and algorithms often prioritise engaging content over accuracy. This has led to a surge in fact-checking: the CFP Board reported that nearly half of Americans now question online financial information at least five times a month, with two-thirds spending more time vetting sources than five years ago.

Contrast this with traditional advisers, who are bound by fiduciary duties and qualifications like CFP certification. A Northwestern Mutual study from just days ago emphasised that while AI and digital tools are on the rise—used by nearly one-third of Americans—most still prefer human interaction for complex tasks like retirement planning. The irony? Social media often mimics this human touch through relatable stories, yet without the accountability.

Implications for Investors and the Industry

For investors, this trend could amplify volatility in personal finances. Analyst models suggest that reliance on unverified advice might lead to impulsive decisions, such as chasing meme stocks or cryptocurrency trends, which have historically resulted in significant losses. For example, multi-year trends from 2020–2023 showed retail investors influenced by social media suffering outsized drawdowns during market corrections.

On the industry side, traditional advisers must adapt. Forbes Advisor’s 2023 guide to choosing financial professionals stresses evaluating credentials and fees, but in 2025, firms are incorporating digital strategies. Hybrid models—combining robo-advisers with human oversight—are gaining traction, potentially bridging the gap. Forecasts from investment analysts at firms like Morningstar predict that by 2030, social media-influenced investing could represent 20–25% of retail flows, labelled as a “high-risk growth segment” due to potential regulatory crackdowns.

Sentiment among verified sources remains cautious. Gallup’s May 2025 report described the trend as “truly concerning,” citing misinformation risks, while InvestmentNews echoed worries about Gen Z’s vulnerability. Dryly put, if financial stability is the new luxury—as Bankrate quipped in July—relying on viral videos might turn aspirations into regrettable anecdotes.

Navigating the New Landscape

To mitigate risks, consumers should treat social media as a starting point, not a sole source. Cross-referencing with credible outlets, such as government resources or certified advisers, is essential. For those eyeing long-term goals like financial independence—94% of Gen Z aim for it before 55, per recent reports—building a diversified strategy grounded in fundamentals trumps trendy tips.

In summary, the pivot to social media for financial advice reflects evolving preferences but demands vigilance. As economic pressures mount, blending digital convenience with professional rigour could offer the best path forward. Investors ignoring this balance risk turning potential gains into avoidable pitfalls.

References

• Bankrate. (2025). American adults trust social media for financial advice – why that’s a terrible idea. https://www.bankrate.com/investing/financial-advisors/american-adults-trust-social-media-for-financial-advice-why-thats-a-terrible-idea/
• CNBC. (2019). 99% of Americans don’t use a financial advisor—here’s why. https://www.cnbc.com/2019/11/11/99percent-of-americans-dont-use-a-financial-advisor-heres-why.html
• Consumer Financial Protection Bureau. (2025). Social media “finfluencers”: Who should you trust? https://dfpi.ca.gov/news/insights/social-media-finfluencers-who-should-you-trust/
• FA Magazine. (2025). Americans trust human connection over AI for financial advice. https://fa-mag.com/news/americans-trust-human-connection-over-ai-for-financial-advice-83637.html
• Forbes Advisor. (2023). How to choose a financial advisor. https://www.forbes.com/advisor/investing/how-to-choose-a-financial-advisor/
• Gallup. (2025). Americans’ financial advice rooted in people. https://news.gallup.com/poll/660467/americans-financial-advice-rooted-people.aspx
• InvestmentNews. (2025). Americans spend more time fact-checking online financial advice as regrets mount, CFP Board finds. https://investmentnews.com/practice-management/americans-spend-more-time-fact-checking-online-financial-advice-as-regrets-mount-cfp-board-finds/261619
• InvestmentNews. (2025). ‘Truly concerning’: Social media is winning Gen Z’s wallets over financial advisors. https://www.investmentnews.com/ria-news/truly-concerning-social-media-is-winning-gen-zs-wallets-over-financial-advisors/260522
• NAPFA. (2025). Social media survey. https://www.napfa.org/social-media-survey
• Philadelphia Federal Reserve. (2025). How Americans use social media for financial advice. https://www.philadelphiafed.org/consumer-finance/how-americans-use-social-media-for-financial-advice
• Securities Law. (2025). Many Gen Zers turning to social media for financial advice, survey finds. https://www.securitieslaw.com/blog/2025/05/many-gen-zers-turning-to-social-media-for-financial-advice-survey-finds/
• TSB. (2025). Over half of those who have acted on social media financial advice have lost money. https://ffnews.com/newsarticle/fintech/over-half-of-those-who-have-acted-on-social-media-financial-advice-have-lost-money-tsb-finds/
• WWNY-TV. (2025). Getting financial advice on social media? Experts say be careful. https://www.wwnytv.com/2025/06/30/getting-financial-advice-social-media-experts-say-be-careful/
• Business Today. (2025). Indians turn to social media over traditional channels for financial advice, new report shows. https://www.businesstoday.in/technology/news/story/indians-turn-to-social-media-over-traditional-channels-for-financial-advice-new-report-shows-488317-2025-08-07
• X (formerly Twitter). (n.d.). Posts by @unusual_whales. Retrieved from:
  • https://x.com/unusual_whales/status/1953082883368992780
  • https://x.com/unusual_whales/status/1953445270819119345
  • https://x.com/unusual_whales/status/1895146123452448918
  • https://x.com/unusual_whales/status/1790004567809081762
  • https://x.com/unusual_whales/status/1941980728264126672
  • https://x.com/unusual_whales/status/1889659973292192229