The rise of finfluencers

Cash stuffing—that old-school, envelope-based budgeting method—is experiencing a resurgence. And this time, its popularity is largely the result of TikTokkers documenting the practice, from designing their own envelopes to providing first-person accounts of their wins (and fails). 

The trend is just one example of how social media is changing how people think about their financial goals. Forget all those dance challenges. TikTok now has #MoneyTok (or #FinTok), a whole genre of content devoted to finance tips. But getting a dance move wrong doesn’t have quite the same effect as a financial misstep. This begs the question—how do you know who to trust among the growing crowd of “finfluencers”? 

Whether it’s sharing investing tips or waxing poetic about financing a car purchase, these new social-media stars primarily use their platforms to educate. But they’re also using the TikTok or Instagram stages to promote financial strategies—some unproven—to their followers. 

“There are two camps,” says Humphrey Yang, a former financial advisor who started publishing personal financial content in 2019 and has amassed more than 5.2 million followers across YouTube, TikTok, and Instagram. “There are the people who just want to give financial or entrepreneurial advice because that’s what they’re intrinsically motivated to do, and then there are people who see the ad rates are high and are trying to create money content to make a living.”

Finfluencers have found an eager audience, particularly among Gen Z and Millennial audiences. In a world where finance is often perceived as boring (and downright intimidating), younger consumers are seeking education beyond traditional channels. 

Schwab’s latest Modern Wealth Survey found that 38% of Gen Zers receive financial information or advice from YouTube, while 33% turn to TikTok. And while 29% of Gen Z respondents say social media has positively impacted how they feel about money, that number drops as ages rise. Just 24% of Millennials, 14% of Gen Xers, and 7% of Boomers agree with this sentiment. 

Hoping to connect with these younger generations, finfluencers aim to make financial education more accessible, engaging, and sometimes even—dare we say—fun. They also prioritize keeping lessons short and sweet.

“Financial services, both by custom and regulation, has not historically lent itself to short-form communication,” says business author Jay Baer. The industry is heavily monitored, and with that comes caveats and disclosures. Finfluencers mostly offer their own opinions that do not come under regulatory scrutiny (for better or for worse). “Finfluencers try to take a relatively comprehensive, nuanced subject and boil it down to 57 seconds,” Jay says. 

Yet that quick-hit, social-first approach carries greater risks when it comes to personal finance advice. If an influencer gives poor advice in a makeup tutorial or a cooking video, the result could be a botched smoky eye or a less-than-perfect poached egg. If a finfluencer gives bad advice, the long-term impact on followers could be far more consequential. 

And consumers typically bear the brunt since finfluencers often aren’t licensed financial professionals or fiduciaries. “If a finfluencer offers wrong advice, what are the repercussions? The answer is largely none,” Jay says. “They don’t have the burden of correctness, whereas financial professionals do.”

Although there’s little regulation of finfluencers, they are required to tell their followers when a brand has sponsored one of their posts. Case in point: In 2022, media personality and entrepreneur Kim Kardashian paid a $1.26 million settlement to the Securities and Exchange Commission amid charges that she promoted a cryptocurrency without disclosing that she’d been paid for the endorsement. 

“Anyone can put on a hat and start making recommendations to their followers, with the confidence to look and sound like they know what they’re talking about,” says Mari Smith, a social media consultant.

Social media users who follow finfluencers can protect themselves with some basic precautions. That includes checking the credentials of the folks they’re following and doing their own research to learn more about the strategies or products that a finfluencer advocates for.

When it comes to big decisions, users should involve “a financial professional, someone who is regulated, and see whether that financial advice makes sense for their situation,” Jay says.

Whether it’s cash stuffing or some other trending #MoneyTok challenge, financial education has taken a hip and humorous turn on social. But any user who really wants to be a #moneymaker should stay cautious, check credentials, and, when in doubt, consult a licensed financial expert.