Why You Shouldn’t Get Financial Tips From Social Media

Many people in the world use social media for their daily news. Some people will use social media for just interacting with friends and others will use it for work.

There are many influential people on the internet and this can get you to buy or do certain things. Something that is often discussed in the online world is financial advice.

In this article, we will explain why you shouldn’t get financial tips online as it can cause you to lose money.

Influencers Giving Unregulated Advice

One of the main reasons why you shouldn’t get your tips from social media is that it is unregulated. These influencers are giving you advice while knowing the risks it poses to you.

The FCA is not able to protect users online from scams or investing their money in any areas they are unsure of. It is down to social media platforms such as Facebook, Instagram and TikTok to regulate this sort of content to ensure users are not being scammed online.

There Are Many Online Scams

The issue with the internet is it is so easy for someone to be scammed, without them knowing who they have been scammed by. It has been an issue for many years now and seems to be more common than ever.

There are many different internet scams that a user must be aware of as well. However, some of the most common scams include pyramid schemes, pump-and-dump scams and much more. These have all been capable of scamming people of thousands of dollars and them not being able to get their money back.

It Is Easy To Follow Trends

Another massive issue people have is that it is easy for people to follow trends. If you see something being talked about a lot, you are likely going to get involved with it yourself.

A good example would be GameStop back in 2021. This was caused by a group of people who managed to convince people to invest in this company. That caused the share price to shoot up significantly. Even Wall Street investors who know the market very well fell for this misinformation, which led them to lose millions of dollars. This was a classic pump-and-dump scam that caused thousands of people to lose millions of dollars.

Many other types of internet scams occur on the internet but not to the scale of GameStop. Nevertheless, these are still influenced by people on TikTok, Twitter, Reddit and other platforms. You must read other news sources about these stocks to ensure you don’t lose too much money.

Summary

As you can see, the internet can be a very dangerous place, especially when it comes to financial tips. Furthermore, AI has caused even more issues online due to impersonating public figures to trick you into investing your money with them.

There are many things you can do to ensure you don’t fall for these scams and one of them is to double-check everything you read. Check the news tab on Google to see if any breaking news stories have been mentioned with what you have just read. Nevertheless, if you fall for one of these scams then you can always consider stock or crypto recovery to see if you can retrieve some of your losses.