In brief
- Nearly two out of three respondents said they had logged on to social media platforms to seek financial advice.
- The ASIC says financial information on social media and accessed through AI tools can be incomplete, promotional or misleading.
Two-thirds of young people rely on social media for their financial investment decisions, with one in five turning to artificial intelligence.
A survey of gen Z (18 to 28-year-olds) released by the Australian Securities and Investments Commission (ASIC) found 56 per cent of respondents somewhat or completely trust financial information on social media.
Nearly two out of three, 63 per cent, said they had logged on to social media platforms to seek financial advice.
In the poll of 1,227 young people, 30 per cent said they watched YouTube videos and 18 per cent relied on artificial intelligence tools to solicit advice about their money.
More than half of those surveyed, 52 per cent, said they trusted "finfluencers" (financial influencers) and 64 per cent put their faith in AI platforms.
Using social media for financial advice was a risk, ASIC commissioner Alan Kirkland warned.
"Financial information on social media and accessed through AI tools can be incomplete, promotional or misleading," he said.
"While gen Z value credibility when seeking financial advice, the information they see most often is shaped by algorithms that are designed to drive clicks and views rather than providing accurate information."
The study found gen Z also had a strong appetite for reputable and trustworthy financial content, with 60 per cent reporting they used formal or professional sources.
But their personal research often led them down a virtual rabbit hole of unreliable accounts designed for engagement rather than accuracy.
Almost one in four members of gen Z own cryptocurrency at 23 per cent, and of these individuals, 66 per cent take a short-term speculative approach to at least some of their crypto investment.
But nearly a third — 29 per cent — said they trade based on social media and influencer content or recommendations.
The financial watchdog said that strategy set unrealistic expectations about returns, price volatility and the realities of long-term investing.
ASIC reminded those in that cohort wanting to invest wisely to access free, reliable and independent guidance through the government's Moneysmart website.
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