The rise of financial influencers: The risks of unregulated advice
Over the past few years, social media has transformed the way people access financial information. Platforms like TikTok, Instagram, and YouTube have given rise to a new generation of so‑called ‘finfluencers’ - individuals who share tips on investing, saving, and building wealth. While many aim to make financial topics more accessible, the rapid growth of this trend has also brought significant risks, particularly for younger audiences.
Why are finfluencers so popular?
For many people (especially younger investors) traditional financial advice can feel complex, expensive, or out of reach. Social media, by contrast, offers quick, digestible content that appears easy to understand and free to access.
Recent research highlights just how widespread this shift has become. The Financial Conduct Authority (FCA) has found that nearly two-thirds of 18-29 year-olds follow financial influencers, with 74% trusting their advice.
While financial influencers have helped make financial topics more mainstream, it has also blurred the line between financial education, opinion, and regulated advice.
The key risk: unregulated financial advice
In the UK, only authorised professionals are allowed to provide regulated financial advice or promote investment products. However, much of the content shared by finfluencers falls outside these rules.
A recent article in the Express highlighted a study by forex broker experts, which found that more than nine in 10 (93%) trading-related videos on TikTok are potentially misleading or harmful. At the same time, 42% of Brits who acted on social media investment content said they lost money. Overall, 93% of the content reviewed was considered potentially misleading according to the study.
The concern isn’t just poor-quality advice, it’s that consumers may not realise they are receiving unregulated or promotional content until it’s too late.
Rising scams linked to social media
One of the most worrying trends is the link between social media financial content and the rise in scams - particularly among younger people. Recent data from Barclays Consumer Research shows that more than half of investment scams now originate on social media platforms.
More broadly, fraud is becoming increasingly sophisticated, with criminals using AI, impersonation, and social engineering to target victims.
Why younger investors are most at risk
Younger people are disproportionately affected by this trend. Not only are they more active on social media, but they are also more likely to engage with influencer-led content.
This creates a perfect environment for exploitation:
Financial content is often presented alongside lifestyle imagery such as luxury travel, cars, and ‘quick wins’, which can make risky investments appear credible.
Many influencers encourage rapid decision-making, increasing the likelihood of poor outcomes.
Trust is often built through personality rather than qualifications or regulation.
The FCA has specifically warned that finfluencers are trusted by young and potentially vulnerable audiences, increasing the risk of unsuitable decisions or financial loss.
The regulatory response
Regulators are increasingly taking action. The FCA has:
Investigated and interviewed influencers suspected of illegal promotions
Issued alerts against unlawful social media accounts
Coordinated with international regulators in a global crackdown
These steps reflect a growing recognition that financial advice delivered via social media carries the same risks as traditional channels—but without the same safeguards.
What does this mean for investors?
Social media can be a useful starting point for financial education - but it should never replace regulated advice.
There are a few key principles investors should keep in mind:
1. Be cautious of ‘too good to be true’
Promises of high returns, low risk, or guaranteed profits are a major red flag.
2. Check credentials
Always verify whether an individual or firm is authorised by the FCA before acting on advice.
3. Avoid pressure to act quickly
Scams often rely on urgency. Taking time to consider decisions is one of the best forms of protection.
4. Seek personalised advice
Financial decisions should reflect your individual circumstances, goals, and risk tolerance - not someone else’s experience online.
In Summary
The rise of financial influencers reflects a positive shift in making money conversations more accessible and engaging. However, it also highlights a growing challenge: distinguishing between helpful education, personal opinion, and regulated advice.
In an environment where misinformation and scams are increasingly sophisticated, the value of trusted, regulated financial advice has never been more important.
