It’s no wonder we stop scrolling and imagine ourselves in that position—why wouldn’t we? What has been presented to us is an ideal situation, framed by the dream location, presented to us by the person with the body, hair or skin we wish we had.


You’re not alone if you’ve considered buying or investing after a quick scroll, because 35% of Millennial and Gen Z investors revealed they do their research on social media. We can learn everything with a quick swipe of the thumb, from the latest trending restaurants to the newest tech available, and financial advice is no exception.


Many trained financial professionals know that social media continues to play a big role in shaping our choices and are making the most of the platforms available to elevate their offerings. But not every influencer is a professional, and not all advice is correct.


It’s important that you stay on top of your finances and manage your money carefully, and this can often feel out of reach if there’s a lot of noise to sift through on your feed. Having control over your finances means you have control over your choices and your life. 


This article highlights how social media plays an active role in your financial decision-making, and how deliberate and considered choices are the best step towards successfully steering your own financial ship.



Social media affects your wealth whether you realise it or not 


Social media has a lot of benefits. You can connect with friends, family, and people who share your interests. But did you know that social media can also have an impact on your wealth? Your perception of what is important, attainable, and popular is impacted by what you see on your feed and this barrage of messaging influences what you spend your money on—even if you don’t realise it.


While social media has unlocked a world of possibilities and opportunities and made information more accessible than ever, it has also made impulsive shopping popular, much like 49% of social media users who impulsively bought a product they saw on their feed. 


This convenience comes at a cost, and the dark side of social media is making many of us financially unstable. This is because seeing an item on our feed creates a sense of urgency and encourages unnecessary purchases. 


To add to this, social media offers a quicker and more efficient way to distribute data and information to influence investor judgements. As a smart investor, it is your responsibility to take any information with a grain of salt, do your own research, and make decisions that are right for you and your financial position.



3 ways social media influences your financial decisions


Here we break down how your financial decisions are impacted and influenced by your feed, and how important it is to take advice from experts or professionals.


1. Saving isn’t posted about, but spending always is


What is everyone looking for when they post online? A sense of importance? A sense of status, even? Social media platforms are designed to give us that fix. But at what cost? This constant need for validation can lead to some unhealthy behaviours, particularly financially. 


People are often more likely to only show the best parts of their lives on social media and this can create an unrealistic standard that others may feel they have to live up to. In a recent survey, 25% of social media users say they have posted on their platforms with the intent of looking successful, while another 62% say they’re sure the people they follow do the same sometimes. 


It can be challenging to be mindful of your spending when everywhere you look online you see people spending on lavish experiences and products. What you need to consider is that trends change quickly, and the posts you are seeing likely have a considerable advertising sum that someone spent on them. It is up to you to sift through the noise and decide whether the messages that are targeting you are what you want to aspire to.



2. Spending is easy–and people tend to regret checking out their digital cart 


Buyer’s regret. You know it. You’ve lived it. And yet you keep going back and hitting “add to cart” time and time again. 


And now, social media is playing into that dirty little habit of yours. Most of us barely notice the extra advertisements that slip between our friend’s photos, and sometimes, we even start following these brands as a result. 


Studies show that Millennials (57%) and Gen Z (66%) are most likely to buy something they saw on their feed, and that’s because you’re continually tempted by whatever the algorithm has in store for you at the time. Unfortunately, it’s these little purchases that can wreak havoc on your budget. 


When you shop online, it’s easy to get caught up in the moment. Instead, take your time. Impulse buys are often the ones you regret the most, with around 64% of impulse shoppers saying they regretted at least one of their online purchases. 


If you see something you think you want, take a step back and sleep on it before making your final decision. Is that small purchase going to benefit you on your path to financial security?



3. Investing with new tech feels like ‘just’ an exciting game when it shouldn’t be


2020 and 2021 saw a huge jump in investing as many people found themselves at home with more time to focus on things they often put on the backburner. But unfortunately for some, the investing experience was associated with a bit of fun, rather than something that needed to be carefully considered. 


Fintech (financial technology) innovations opened new ways to trade, with some new investors saying they felt like they were playing a new game on their phones. Does Bitcoin ring a bell? These new trends in trading can have severe repercussions for those who do not make decisions with the right information and enough thought. 


When asked why they started investing, 27% of users said it was exciting and 24% said it was easy to do by themselves. These days, this thought process is not enough, especially since there’s a steady devaluation of fiat currencies as inflation continues to rise. 


If one word can describe how many fintech innovations have affected traditional trading, it’s ‘disruption.’ Like most things, new tech continues to move us away from large, entrenched institutions, making financial advice easier to access. It is important to remember though, that not all financial advice is right for you.


So, while you scroll Instagram after your shift today, consider this: are the products you’re seeing what you need right now? Does an influencer with 100k followers automatically become a financial expert? Is the algorithm working for you, or against you? Is this trend something you really need to jump on? 


With the right finance and investing advice, you can make intelligent decisions about where to allocate your resources, grow your wealth, and avoid making emotional (and impulse) decisions that can jeopardise your back pocket.


To start buying gold today, download the Nauggets app. We’re not a trend, we’re here to stay.