What are the “in” and “out” of 2024? Still trending on social media, And we're adding one more thing. He suggests that traditional banking advisors are leaving and financial influencers, or “finfluencers,” are on board. new report The CFA Institute's Center for Research and Policy made the announcement earlier this month.
Gen Z participants in the study told CFA Institute that creators are professional for several reasons, including being accessible 24 hours a day and offering free advice by posting videos on platforms like TikTok and YouTube. said they trust financial influencers more than their advisors. .
Influential companies in the financial world are also benefiting from the rise in consumer demand. Demand for long-form online content. These creators typically take more than 30 seconds to explain complex topics, such as which investments to make or which bonds to buy.
“Gen Z actually somewhat prefers consuming financial information delivered in a mobile-first, technology-driven interface rather than a traditional human-driven advice approach,” said Rhodri Preece, senior director of research at CFA Institute. he said. Business Insider.
CFA Institute conducted interviews with 32 Gen Zers across five markets – the US, UK, France, Germany and the Netherlands – to examine participants' investment attitudes and preferences.
Here are four reasons why 'finfluencers' are having a huge impact on young people's investment decisions.
1. Distrust of traditional financial institutions is driving Gen Z toward more “friendly” advisors.
Most participants reported being skeptical of traditional banks and personal finance advisors. They boil it down to concerns that advisors are not acting in the best interests of their clients because they believe that those who work at financial institutions are looking out for their own interests. Ta.
Gen Z participants in this study were influenced by their age, ability to easily break down certain notions, and influencers. tick tock.
“Many of them told us they prefer online because it gives them more reach than going to a bank and meeting a human advisor,” Preece said. “On the Internet, you can find people your age, [who] You are more likely to trust someone if they have the same background as you. ”
2. Long-form content is popular now.
Platforms including short video app TikTok are currently long video, stemming from online audience preferences for more educational and informative content. Preece said the return of long-form content suits the needs of financial influencers because it takes 10 minutes to explain a concept instead of 30 seconds.
”“Most financial topics are complex, so it gives viewers more time to really understand and think through the information,” he said.
He also said that longer videos will allow creators to better consider appropriate disclosures and disclaimers. For example, a creator may be making affiliate money from followers who use their link to apply for a new credit card or invest in a new type. Of bonds.
3. Young people want more information about unregulated assets such as cryptocurrencies
Most financial influencers specialize in providing information about very niche and complex topics like cryptocurrencies because they understand that their audience likely wasn't taught by school or family. It has turned into.
According to CFA Institute Report published last yearBecause Gen Z is the age group most likely to own cryptocurrencies compared to other demographics, Reese believes this type of investment content is the key to why finfluencers are making such a leap forward. He said that is the reason.
4. Accessibility and low cost are driving the popularity of financial content
Focus group participants told CFA Institute that they often view Finfluencer content in their free time, rather than setting aside time like they would with a banker or personal advisor. Gen Z also said they liked that money tips on YouTube, TikTok, and Instagram were free.
“Young people don't want to pay for advice, and that's one of the factors,” Preece said.
