Almost one in three Australians is seeking financial advice from social media influences, according to new research.
Data from Compare Club found half of those aged 18-24 and 10 per cent of people aged over 55 use platforms like YouTube, Facebook, and TikTok for financial insights.
Experts warn that the rise of “finfluencers” — or financial influencers — could negatively impact how young people interact with money.
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“Too many Australians are getting financial advice from unreliable sources like social media,” Financial Services Council chief executive Blake Briggs said.
“It’s impossible to tell who is providing good advice on social media and who isn’t. For the average Australian it’s very difficult to them to discern from what is good advice and what is not.”
Briggs said people were turning to social media at a concerning rate due to the high cost of financial assistance.
The average cost of hiring a financial adviser or accountant is between $3500 to $7000, depending on whether the customer opts for general or comprehensive advice.
“There is a big concern with the rise in social media as a source of information is unstoppable,” he said.
“The way to tackle that is to make sure the cost of advice from reliable sources comes down through government reform.
“The cost of providing financial advice has been weighed down by regulations putting it out of reach to most Australians.”
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According to the research, people who get financial advice from social media are twice as likely to pay their bills late and three more times as likely to use a credit card.
About 79 per cent were more likely to be living beyond their means.
“This research highlights that there is a growing demand for cost-effective, accessible and easy-to-understand financial insights at a time where cost of living pressures are high,” Compare Club’s head of research Kate Browne said.
“While many content creators do a great job teaching skills like budgeting or investing, it can be very difficult to assess the legitimacy of advice.
“We’ve found an alarming link between those who use social media for financial advice and increased difficulties in their financial affairs.”
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