Social media has evolved into a one-stop hub for everything from entertainment to investing advice. According to a recent survey, 32% of respondents reported relying on social media for financial advice.1
But while social media makes it easy to access information, it also blurs the line between education and persuasion. Just because someone has a large following doesn’t mean they have professional training — or your best interest at heart.
What is a finfluencer?
A finfluencer is a social media personality who shares opinions, investment strategies, or budgeting tips online. Some do offer helpful insights into basic financial literacy. However, many promote high-risk products or outdated strategies for personal gain.
Unlike licensed financial professionals, finfluencers aren’t regulated, trained, or held to ethical standards. In other words, anyone with a camera and a following can become a finfluencer — and the followers who act on their advice have no protection or recourse if that advice turns out to be inaccurate or harmful.
Conflicts of interest are common
Finfluencers typically earn income through sponsorships or affiliate marketing. Those payments often go undisclosed, creating a conflict of interest. When a finfluencer’s paycheck depends on your purchase or click, their advice becomes self-serving — not fiduciary.
SEC vs. Kim Kardashian
In October 2022, the U.S. Securities and Exchange Commission charged Kim Kardashian with unlawfully promoting EMAX cryptocurrency on Instagram without disclosing a $250,000 payment. At the time, Kardashian had 330 million followers. She agreed to pay a $1 million fine and return $260,000 — which included her payment from the company with interest — without admitting or denying the findings.2 This case is a reminder that when celebrities endorse investment opportunities, it doesn’t mean those investment products are right for all investors, or even legitimate.
One-size-fits-all advice doesn’t work
Your goals, income, and risk tolerance are unique. Generic financial advice can’t account for your complete financial picture and can even steer you toward unsuitable or risky investments.
If you’re looking for a financial advisor, asking the right questions to find someone who’s going to work in your best interest is key. Our article breaks down the questions you should ask when choosing a financial advisor.
The value of working with a fiduciary
The right financial advisor can make a world of difference in managing your money. One of the most important distinctions to understand is whether your advisor is a fiduciary. Having an advisor who is a fiduciary, or one that isn’t, can have real implications for the type of advice you receive, the fees you pay, and the trust you place in your advisor.
A fiduciary financial advisor is legally and ethically bound to act in your best interest. This means their advice must prioritize your financial well-being. It must be more important than their own compensation or the interests of any company they represent.
A non-fiduciary financial advisor may follow “suitability standards”, meaning they’re only required to offer recommendations that are suitable for you. However, they don’t have to necessarily be the best or most cost-effective options. This unrestricting standard can lead to conflicts of interest, especially when the advisor earns commissions on certain products.
Fiduciary vs. Non-Fiduciary: 4 Key Differences
| Fiduciary | Non-Fiduciary | |
| Putting your interests first | Fiduciaries are under obligation to avoid conflicts of interest and disclose any that do exist. If their own financial gain influences their advice, they have to let you know and work to resolve that conflict in your favor. | Non-fiduciaries may recommend higher-cost investments which earn them more in commissions and are still “suitable.” |
| Offering objective advice | Fiduciary advisors are often fee-only. Their compensation typically comes directly from clients through a flat fee, hourly rate, or percentage of assets under management. This structure helps ensure that their advice is objective and not influenced by incentives from third-party companies.
|
Non-fiduciary advisors may have incentives to sell specific products (like annuities or mutual funds). The products may pay them commissions, potentially skewing the guidance they provide. |
| Providing ongoing duty of care | Fiduciaries must continuously monitor your investments and financial situation. This helps to ensure their advice remains in your best interest over time. They’re not off the hook after the initial consultation. | Non-fiduciaries might not offer ongoing support or only engage when you seek it out. It depends on their business model. |
| Being transparent about fees | Fiduciary advisors are generally upfront about how they receive payment. This transparency helps build trust and avoids unknown costs down the road. | Non-fiduciary advisors, especially commission-based advisors, might have more complex compensation models. They’re not as easy to understand and potentially hide fees with product pricing or backend commissions. |
FAQs about financial advice from social media
- Can I trust financial influencers on social media?
Although you can learn basic money management tips online, be cautious about following unverified investment advice. Always consult a licensed fiduciary advisor before acting.
- Are all finfluencers unqualified?
Not all, but most are not licensed or regulated. Without fiduciary responsibility, they’re not legally required to act in your best interest.
- What’s the safest way to get financial advice?
Work with a fiduciary financial advisor who understands your entire financial situation and builds a plan around your goals.
- How can I identify a financial scam on social media?
Avoid anyone promising guaranteed returns, using high-pressure tactics, or asking for money or personal details upfront.
What sets Mercer Advisors apart?
Whether you have $300,000 or $300,000,000, Mercer Advisors provides a comprehensive wealth management experience that’s tailored to you and your specific circumstances and needs. Here’s how we can help amplify and simplify your financial life — and your family’s future:
- A unified in-house team of planners, accountants, and estate specialists that designs — and executes — your financial plan.
- A hand-picked wealth advisor who is focused on serving you, not on finding new clients.
- An institutional-grade portfolio that is tailored specifically for you and managed by a team of 100+ investment professionals (not just one advisor).
- A boutique fiduciary with national strength that combines intimate service and sophisticated capability and only acts in your best interest.
Working with the right advisor is more than just good investing. It’s about building a relationship with someone who listens, understands, and puts your needs first. At Mercer Advisors, we’re here to be that partner. Ready to get started? Let’s talk.
1 Measom, Cynthia. “32% of Americans Trust Social Media for Financial Advice: 5 Best Money Tips From ‘Finfluencers’.” Yahoo Finance, May 29, 2023.
2 Gura, David. “SEC charges Kim Kardashian for unlawfully touting crypto on her Instagram account.” NPR WHYY, Oct. 3, 2022.
All expressions of opinion reflect the judgment of the author as of the date of publication and are subject to change. Some of the research and ratings shown in this presentation come from third parties that are not affiliated with Mercer Advisors. The information is believed to be accurate but is not guaranteed or warranted by Mercer Advisors. Content, research, tools and stock or option symbols are for educational and illustrative purposes only and do not imply a recommendation or solicitation to buy or sell a particular security or to engage in any particular investment strategy.
