Financial services providers must take action to regain their influence over young people's financial education, according to the latest findings from the Young Money report by reputation management consultancy MRM.
Despite a tough economic climate, young people in the UK are optimistic about their financial future with nearly two-thirds (63%) expecting their standard of living to increase in the next twelve months. However, nine out of 10 (90%) 18–30-year-olds say they want more guidance when it comes to managing their money.
Almost half (47%) of the young people surveyed said they believe their financial services providers should be responsible for providing them with sound financial guidance and education, ranking it as the joint highest response alongside schools and colleges.
In fact, the importance of financial services in young people's financial education outweighs their own belief in personal responsibility (36%), with 41% of respondents also stating that they would seek guidance from their families.
When asked about the sources they use to get financial information from, social media was by far the most popular destination with nearly half of respondents (45%) citing it. A third (33%) also highlighted direct communications from their financial service providers either by email (33%) or in-app messages (29%). More traditional media outlets like broadsheet newspapers (24%) and television (23%) were cited by around a quarter of those surveyed.
A large part of this rise in social media interaction can be attributed to finfluencers. Six in 10 (59%) say they follow finfluencers, growing to 74% among the young Londoners surveyed. Only 3% of respondents said they didn’t trust finfluencer information, while a substantial 77% do.
Those figures remain consistent with the findings of the 2022 Young Money Report -which were previously quoted by the FCA when it proposed tougher rules on social media promotions in July 2023. Almost the same proportion of young people said then that they followed finfluencers (62%) and trusted what they say (74%).
Clearly the findings show that social media continues to hold sway in the modern financial landscape, especially considering one in seven (14%) of young people would take financial action based purely on what they had seen from an influencer online.
Chris Tuite, Director and Head of Consumer Finance at MRM, comments: “The message delivered by young people in the UK couldn’t be clearer. They want financial services firms to step up and regain their finfluence. They say they need real, reliable financial guidance, and they expect financial services firms to provide it.”
Tuite continues: “While many social media influencers offer some helpful tips, others are spreading unverified and, in some cases, harmful financial advice. The Financial Conduct Authority (FCA) cracked down on rogue finfluencers in October 2024, but that is just the beginning. Young people need trusted sources of information to help them build stronger financial foundations and stop certain unregulated influencers filling the void with potentially dangerous and misleading advice.
“The key question financial services providers must grapple with is how to do that. Our data shows these firms are largely present on social channels but are not able to garner the same attention as this new breed of finfluencers.
Tuite concludes: “The FCA is clearly signalling its intention to clear up any grey areas, but the industry also has an opportunity to give young people what they want. They need to start creating the kind of social content that will deliver, and crucially, focus on guidance more than gamification or instant gratification.”
