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Edutainment. It’s about learning more about your favourite topics on social media and being entertained at the same time. But you need to learn to critically evaluate what you are being told!
We love that you are learning on social media...
The 1Life Insurance 2024 Generational Wealth Youth survey found that over 45% of respondents use social media to help them manage their finances! As less than 30% of South African youth have a solid monthly budget in place, any encouragement to get a budget and build good financial habits, from any source, is welcome!
Some of the advice on social media is good, and you can learn about investing and how to manage your money well. But there are also many biased opinions and ideas, uninformed and inaccurate posts!
It's all about social media literacy
Social media literacy is all about responsible use of your favourite feeds. Think critically about the information shared and evaluate its credibility and reliability. Here’s how...
Find out who the advice comes from
Who is posting? Is it a young South African sharing their experiences, is it a financial expert such as a financial adviser, or is it a business using an influencer to sell their products? Do some research on the person and/or any company mentioned in the post to see who they are, what their qualifications and experiences are. A post using personal experience can be invaluable as you may have a similar situation to them, such as when a person shares how to buy a first car or home. A qualified expert may also help you understand financial concepts and have good tips on how to invest wisely.
Fact check information and advice
Even if the post says it comes from experts, and even if it seems believable, logical, truthful and factual, you must check the facts if you are considering using the information or advice! If there is a product mentioned, such as an investment fund, research more about the product. If a company is mentioned, research the company, and if a piece of legislation is mentioned, research this too! There have been instances of social media posts stating that new laws allow your debt to be written off – which is not true! So, be a non-believer to start with, especially before you part ways with any money!
Find out if posts are paid for
Reputable social media users will always disclose somewhere if they are paid to explain a product, sell a product, review a product or are part of a financial services group. This does not mean any advice or information they give is biased, in fact the opposite is often true! Many paid influencer posts and brand affiliate posts contain excellent information. But it does mean the information they share about products is only about one product. This product may be suitable for you, but there are probably also other products that will be suitable too that you should research before making any financial decisions!
Look for feedback and interaction
Be sure to read the comments and reviews from other followers. Their comments and any debate in the comments can give you some idea of whether the information is accurate and factual, and whether the host is biased or not.
Get independent financial advice if the decision involves a lot of money
Only licensed financial advisers are qualified to give financial advice, and any advice they give has to be personal to your circumstances. In other words, they have to have met you, asked about your financial goals and circumstances, and determined what your financial needs are. If you follow advice from someone who has not done this, you run the risk of buying a product or making an investment that is unsuitable and you could lose money. For big financial decisions the best person to ask for advice is a licensed financial adviser.
Watch out for the scams
When it comes to scams, the idea is for the criminal to get you to part with your money so they can pocket it! They may also want your personal details to commit identity fraud and run up bills in your name.
- Before you part with any money, make sure you verify the legitimacy of the organisation, and that any investment is being run by a registered financial services provider.
- Don't pay funds into an unknown bank account, check it out first with your bank to see that the bank account belongs to who it is supposed to.
- And, as always, protect your personal information! Before you give out your personal details, make sure there is a good reason, such as you are investing with a registered financial services provider.
Follow 1Life Insurance and Truth About Money on social media to boost your money smarts
Follow 1Life Insurance on X and TikTok as well as Facebook and Instagram. Keep an eye out for educational posts from Truth About Money, and give your finances a makeover with posts about financial planning, budgeting, saving and investing in our TikTok Money Makeover series!
Enjoy the financial fundi's but think twice before following their advice
The bottom line when it comes to social media and financial advice is to stop and think how the advice relates to you! Be careful of parting with your money, and when you do make sure it is to a legitimate organisation and will be well managed. There is some excellent financial commentary available on social media that can help you become financially independent!