Social media offers strong appeal for the masses to learn finance due to the ability to quickly disseminate information in a digestible way.
While this may not be how previous generations learned financial acumen, it is undeniable that social media platforms are opening new ways of understanding how to build wealth.
According to a recent survey conducted by National Australia Bank, 31 per cent of 18–29-year-olds consider themselves as savvy savers. TikTok is becoming a popular tool for accessing information, with ‘money management’ searched over 21m times by users last financial year. So, what are the benefits, challenges and basic principles the Rising Generation need to consider to continue building wealth for generations to come?
Benefits of social media for financial education
Short and catchy
TikTok and other forms of social media provide short, catchy and easy ways to learn about financial acumen. This content format can be accessed relatively easily and packages complex concepts into bite-sized chunks.
Easy challenges to try
Some of the content offers easy challenges for you to introduce to your day-to-day life, which helps with understanding basic saving principles. For example, waiting 48 hours on large purchases and ‘spending free’ weeks to understand whether you really want to purchase an item. In turn, it encourages saving and thinking about what you're buying.
Diverse experiences and perspectives
Social media has democratised knowledge, with anyone able to establish a social media presence. This provides more diverse perspectives around different spending habits and experiences.
Community support
Often, it’s easy to find community support when it comes to learning about financial acumen on social media. People set up community Facebook pages to establish a forum where members can learn off each other. Separately, it can be a way for people to find like-minded individuals that help validate their own experiences or challenge their perspective.
Challenges of social media for financial education
Misinformation
While it can be a positive that more people have access to financial education information on social media platforms, there is a risk of misinformation, particularly when it comes to more complex or technical topics. It’s critical to always consult a professional for advice tailored for your personal situation.
Keeping up with the influencers
Social media has also become a marketplace, with some influencers having paid partnerships with brands, affiliate links and ‘discount codes’, encouraging spending on material branded items. Although influencers are now required to disclose paid partnerships or advertising, it can be easily missed. Ensure you always do your research, and be aware of any overtly branded posts.
Professional and personalised advice
The content on social media is often general advice. It does not include the tax structure or asset protection you need to consider in your personal situation.
Back to basics
While the Rising Generation are exposed to different learning platforms because of social media, communication, budgets and education are still critical to ensure both generations are on the same page.
Start the conversation
It’s important for families to discuss finances. A topic we once held close to our chest is now something families need to have an open conversation about to help the Rising Generation increase their financial awareness. It helps them understand what their parents contemplate or research when making a financial decision. Separately, creating an environment where any question can be asked is critical to establish a culture of curiosity within the family business.
Budgeting
It doesn’t need to be sophisticated or detailed, but it’s important to allocate funds – for example to savings, spending and emergency accounts – each time you’re paid. Budgeting helps you create a plan and visualise your income and outgoings. It helps track your financial goals and puts guardrails in place to avoid overspending. This creates discipline from a young age to be considerate with your spending, which can involve to investing once the rising generation are older.
Education
When considering further education, do not overlook financial education. It is important to understand financial investments, the property market, asset protection and estate planning – to name a few. Learning about money from a young age is crucial as these early stages form the building blocks for more sophisticated wealth generation as the Rising Generation become older.
We’re here to help
We need to work with the Rising Generation so they understand the value of money and can continue to grow the family wealth for generations to come. If they’re seeking advice from social media, we recommend complementing that with formal coaching courses as well.
Sign up for our Rising Generation Financial Acumen course below and empower the next generation to build wealth for your family and business. Feel confident in their ability to secure a prosperous future. Complement your social media knowledge with our financial acumen course.
Learn more about how our Rising generation financial acumen training services can help you
