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Guiding Clients Through Social Media Misinformation

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What You Need to Know

  • Consumers ages 18-29 are more likely to get financial information through Instagram than through LinkedIn.
  • Instead of correcting social media commenter errors, explain concepts.
  • Explain how an idea seen on social media might or might not fit in the existing financial plan.

In the current digital era, it can feel like we have the world at our fingertips.

Anything you would like to know is just a few taps away.

But is this information always trustworthy? Social media is now a source of news and learning, and has even become a source for financial advice, both good and bad.

According to a recent MDRT study, 68% of Americans say they use at least one social media platform to learn about finance and investing.

However, this advice is often not presented by a certified financial advisor, nor is it always accurate.

By guiding your clients through financial misinformation they’ve found online, and helping them identify what’s credible and what’s not, you can build stronger client relationships while demonstrating the value of the personalized expertise you provide them.

Where are your clients finding financial information?

Content creators share DIY financial advice on many social media platforms — and your clients are likely learning from them.

According to the same MDRT survey, nine social media platforms attract at least 20% of consumers 18 through 29 for learning about finance and investing: Instagram (48%), Facebook (45%), YouTube (40%), TikTok (31%), Reddit (28%), Twitter (26%), Snapchat (23%), Discord (21%) and LinkedIn (20%).

With so many social media influencers sharing financial advice, some consumers may feel it’s not necessary to seek counsel from a certified professional.

Or, while some of this advice may seem helpful to your clients, it might not actually be a good fit for their personal financial plan.

This is especially true for younger clients, who may see a video explaining a complex financial concept during their daily scrolling and move to implement it — without fully understanding if it’s complementary to their long-term financial goals.

Become a trusted source.

The financial advice being shared on social media may not always be accurate, or if it is, may already be a part of your client’s financial plan and they didn’t realize it.

Content creators sharing financial ideas may not be licensed professionals, and therefore aren’t required to be fact-checked or approved by a compliance department.

Instead, many of these ideas may be infused with the creator’s opinions or personal experiences.

There’s a good chance that your clients will come to you with questions about something they saw on social media.

This makes it important for you to serve as a sounding board for financial concepts that clients see online and be poised to address their concerns or questions.

Rather than pointing out how the content creator is wrong, though, take the opportunity to explain the financial concept your clients are seeing.

This will help the client not only understand the concept, but also view you as their trusted source for financial information.

From there, let the facts drive the conversation.

Explain how this concept may affect their plan, how it already is incorporated into the client’s plan, or why it isn’t a fit for their financial goals.

Not only does this address their questions, but it’s also proof that a financial advisor is beneficial in creating an individualized plan that best meets the client’s needs.

Go one step further by proactively asking them about financial advice they might have seen recently; this sets you up well to understand what’s caught their attention lately, and to actively protect them against strategies that might not fit well into their plan or help them incorporate them if it makes sense.

Social media can be a powerful tool, but it’s also home to many fallacies when it comes to financial advice.

With so many consumers using social media as their source for financial information, it’s important to help educate and guide clients through the murky waters of Facebook, Instagram and Twitter.

Clarifying the financial concepts clients hear online will allow you to build a stronger relationship in person, and prove how beneficial you are to their long-term financial well-being.


Brandon Heckert (Photo: Heckert)Brandon Heckert is an advisor at FSM Wealth and a five-year Million Dollar Round Table member. He spoke at the 2019 MDRT annual meeting and the 2019 MDRT global conference.

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