Should You Get Financial Advice From TikTok?

What Kind of Financial Advice Is on TikTok?

Creators are flooding TikTok with financial advice—both good and bad. Some TikToks analyze which companies to watch on the stock market or provide a breakdown of options trading. Others share useful financial knowledge that guides viewers to try budgeting techniques to get rid of debt or how to capitalize on a side hustle.

These bite-sized videos breaking down complex concepts can make for entertaining and efficient ways to learn. Picking up a book on investing for retirement may not appeal to the average teenager, but a TikTok can package the information in a digestible form, then deliver it en masse to young viewers looking to invest in their futures. It likely won't deliver a deep dive into the subject, but even a barebones overview of a topic could be enough to spur further research and action.

Undeniably, the platform can be a valuable instrument in the early stages of learning about finances and how to manage your money. How useful this information is, however, depends on how well the app's users can discern what's good advice and what isn't. The app's algorithm-driven nature means you don't have much direct control over what you see, so it's important not to take everything at face value simply because it makes its way into your feed.

How to Separate the Good Advice From the Bad

In TikTok's seemingly never-ending feed of finance-focused content, a portion is bound to be inaccurate, malicious or just plain bad advice. Ask yourself three questions to determine the worth of the personal finance TikToks you see:

1. Who Is Posting It?

Some TikTok pages, like those of news organizations and financial institutions, adhere to strict standards for accuracy—for example, Experian's TikTok account. Similarly, certified professionals are more likely to post more trustworthy information. They can face instant backlash in the comments or replies if they dole out bad advice online. Just confirm their identities and qualifications before you assume they know what they're talking about. If the poster is a "finfluencer" (personal finance influencer), they may not be an expert, but can still offer valuable knowledge based on personal experience and research.

2. What Is the Source?

Is the TikTok a result of the poster's personal experience, like a frugal-minded creator posting about their budgeting methods, or is it something that can be confirmed through your own research? The number of views a TikTok has is no indication of its accuracy, either. One viral TikTok included a presumably well-meaning individual encouraging viewers to exploit tax law to their benefit—unfortunately, the method she suggests could qualify as tax fraud. Be diligent and check sources of financial information on TikTok to avoid mishaps and misinformation.

3. How Does It Apply to You?

Do your own research before making any money moves, as even great advice might not be suited for your life. One TikTok user may recommend limiting your mortgage payments, while another advises you implement extra payments—either recommendation could have merit, but they depend entirely on your unique financial situation.

It's important to look out for red flags too: If a TikTok is guaranteeing you an easy million dollars or pushing you to purchase specific stocks, steer clear. Instead, look for posts that explain things more generally, suggest legitimate methods of investing for yourself and offer other advice you can use to make smarter financial decisions. Be sure to keep your personal information private, and go to professionals before making any big moves.

When and Where to Get Expert Help

Much of the financial advice you come across on TikTok may require additional help from a real-life professional to implement. The world of finance is wide, but these are the key experts you should consider contacting for help with different issues:

• For tax questions: After you've watched some particularly insightful TikToks about boosting your tax return this year, talk to a qualified tax preparer or certified public accountant (CPA) near you. They can advise you based on your unique income and assets.
• For investing questions: TikTok can be a great place to discover investment plans like 401(k)s and Roth IRAs, as well as to learn about stock market terms and news. However, you may want to discuss the details with a trusted financial advisor before you start making specific financial moves.
• For housing questions: Mortgage professionals, like specialized attorneys, will know the pertinent legal and fiscal components of a home loan—and, unlike TikTok posts, they can hone in on your individual needs when it comes to managing a mortgage or considering different housing loans.
• For credit questions: Credit card debt is no joke, and creators on TikTok love to offer up their own ways to conquer it. Some of the credit advice you'll encounter on the platform is misguided or blatantly inaccurate, however, so it's best to consider contacting a credit counselor or consulting reputable sources such as Experian's credit education blog when tackling the issue. When you see high interest fees piling up, you can also look into free financial services near you for no-cost help managing your money.

Often in the case of finance professionals posting on TikTok, their certifications can point you in the right direction. Check on the posters' credentials, then search for similarly (or better) qualified specialists to guide you.

The Bottom Line

There's a big difference between using TikTok to budget better and using TikTok to invest large sums of money. It's always a good idea to double-check advice from any TikTok, tweet or Facebook post you plan to implement into your life, especially when it comes to your money.