What is FinTok? TikTok influencers offering money advice to Gen Z - but is it a useful financial tool?

We spoke to InvestwithRuss and TikTokInvestors to find out if Tik Tok is a helpful tool for financial literacy

Launched in 2016, TikTok is arguably the epitome of Gen Z adapting to the shifting society shaping around us.

With one billion active users in 2021, TikTok and other visual-based social media - such as Instagram, which has 1.386 billion active users according to BackLinko - provide ways to educate, entertain and inform.

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TikTok is infamous for its niche areas, and one gaining momentum is FinTok.

But what exactly is FinTok and is it reshaping financial literacy?

What is FinTok?

FinTok is a subsection dedicated to providing financial advice and hacks to managing money with content creators collapsing hard to grasp concepts into informative yet short clips.

The short clips cover the foundation of basic financial literacy, from what stock investing is to generating multiple side incomes, also known as side hustles.

What is FinTok? TikTok influencers offering money advice to Gen Z - but is it a useful financial tool?

Ali Bukhari, a 19-year-old-student in London, said: “With the genuine videos, like how to save money as a student, they can be incredibly helpful”.

This idea of informing and educating people to be more financially aware, seems like the on-brand method for Gen Z to tackle the topic of money talk - something usually deemed as too private to divulge.

InvestwithRuss is run by Russell Faigen and his team, who began making TikTok videos in September 2020 after working for a Fintech startup.

He began his account “as a way for me to interact and learn and teach myself every single day.

“I started to push myself to go into the news and create a story to share with everyone else. It really started out as something fun that picked up momentum. Then I was able to turn it into a career.”

He added: “A very large part of Fintok is the story visually. It makes the content enjoyable.

“The general consensus is how can we help the youth? How can we help them grow into a higher class of financial educators that are financial literate and financially intelligent?”

The different sides to FinTok 

FinTok may present itself as a way to improve financial literacy, however there are also concerns about videos promoting wealth and a materialistic lifestyle.

On the driving force behind FinTok, Bukhari said: “it can be quite overwhelming…

“I feel like the videos promote a hyper material lifestyle where people are trying to sell you their courses - that’s pretty crazy.

“It’s as if it’s just purely driven by money.

“There’s a fine line, social media has allowed a lot of good things to spread as well as a lot of toxic and hyper-social things, because I feel this generation is a lot more understanding and compassionate.

“But there’s another wave of people in Gen Z that are just purely driven by money and they’re really driven by just purely material things.

“It balances itself out. There are some ‘helping students’ type videos, but you see this hyper, capitalistic drive amongst the age ranges as well.”

This side, Bukhari thinks, has evolved as a rebellion against the current work lifestyle we see today: “I feel like there’s a group of people in my generation that just take it so far to the point that they absolutely reject anything to do with a nine to five lifestyle. So making their own money, and being financially independent, it’s the very first thing that they talk about.”

The two sides of social media 

There have always been two sides to social media.

On the one hand, there is now a widely accessible platform to help distribute ideas and connect to other people.

On the other, there’s an alternative and accessible method to make large sums of money without working a 9 to 5 - but with that follows potentially harmful advice.

TikTokInvestors is a parody FinTok account that started last summer during the pandemic.

Having a background in public and private finance, they decided to post content of "anything that just makes me laugh or gets a reaction out of me... has me saying ‘that doesn’t make any sense’.

“There was a guy recently who was saying if you had student loans, instead of paying back your student loans, you should actually take those loans and buy fixer-up real estate. Then sell that and from the profits and pay down the loans. So it’s like leverage on leverage almost.

"For the 1% of people who understand the real estate market and understand the cost that goes into fixing up a property, that might make sense.

“But for 99% of impressionable listeners, that is absolutely terrible advice. Take whatever money you have, pay down your student debt as quickly as you can, be debt-free, and then you can think about other various things."

However, when it comes to certain content creators, TikTokInvestors, said: "They’re clearly making these videos because they’re marketing themselves so people can get onto their discord (instant messaging platform) and pay their annual fee. I don’t know what happens in these discords, but it’s obviously a marketing ploy.”

However, they stress that FinTok isn’t all bad: “FinTok is probably going to be good over the long term for financial education. If you have somebody that is trustworthy and provides real financial literacy - social media is a wonderful platform to push that out."

Faigen agrees and said: “I’m not here to influence my viewers in a negative capacity. I’m here to teach.

“However, there were stock talkers that would create discords and use that community to pump up stock and then make a video about how they just had the most miraculous week of their trading life.

“I can’t see FinTok going down the path that it once went down. I really think the act is cleaned up. We really appreciate our viewers, there’s really no negative motive at all.”

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