Personal finance is a hit on TikTok

VMARKED IDEAS #moneytok had 10.6 billion views on TikTok, more than #tacotuesday, #gossip and #cookingtiktok. Creators can use the tag to flag their posts as part of a genre on the short-form video platform that offers financial advice. In posts lasting less than a minute, Mandi Woodruff-Santos posts career and investment advice to her 27,500 followers. Ms Woodruff-Santos, who was born in Atlanta, Georgia, says her working-class parents didn’t discuss investments at the dinner table and her upbringing left her with little knowledge of how to manage a credit card or negotiate a raise. Now she and other influencers are helping their followers with money issues.

It hasn’t quite gained the notoriety that Reddit, an online forum frequented by many retail bettors, gained during the dramatic rise in GameStop stock last year. But TikTok, which has 1 billion users worldwide, is introducing many young Americans to the world of savings and investing. Nearly a quarter of investors aged 18-40, and 41% of those aged 18-24, sought financial advice on the platform, according to a survey conducted last year by Magnify Money, a website .

Videos can rely primarily on text (“HOW TO BEAT CREDIT CARDS” or “Adulting 101”), or can feature cute kids or dancing. Some creators use their experience to explain financial concepts. Retail company boss Mark Tilbury has amassed 7 million followers with his explanations of Fortune 500 company strategies. Other creators tap into their personal experience. Tori Dunlap, who founded Her First 100k, which offers financial advice and paid finance courses for women, says she grew up in a family that often talked about finances. “I’ve become the go-to money friend,” says Ms Dunlap, now a money friend to around 2 million followers. Still others tout the stock’s potential for gains, like videos of day traders in California posing with their sports cars after striking gold in the markets.

As with social media more broadly, the problem is that posts can be misleading or inaccurate. TikTok has certain rules for monitoring content: users can flag posts, and creators must tag branded content they can profit from. Those who click on #moneytok are warned that investing involves risk. But some videos are only 15 seconds long, leaving little time for nuanced discussions about these risks. According to a study by Paxful, a cryptocurrency trading platform, only around 10% of top influencers mention financial qualifications in their TikTok bios or on their personal websites. Day-traders posting on TikTok are posting big gains, but few might admit nursing losses, as they may be doing after the market turmoil of the past few days. The popularity of #moneytok is certainly a testament to users’ enthusiasm for finance and investing. The hope is that social media nurtures, rather than destroys, that interest.

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This article appeared in the Finance and Economics section of the print edition under the headline “MoneyToks”

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