Gen Z uses TikTok over Google for everyday information searches. It’s easy to see why: if you’ve ever lost track of time scrolling through your For You page, you know you can find tips on almost anything under the sun – including money.
More than a third of Gen Z turn to TikTok for financial advice. While more young people seeking financial advice indicate a positive trend in financial literacy, the problem is that some of this advice may not be accurate.
And some can even lead to legal problems.
We spoke to an attorney and a credit counselor who have seen firsthand what can happen when people listen. Here are the “FinToks” that can get you in trouble – and tips on how to avoid bad financial advice on social media.
The devil is in the details
Michelle Creeden and David A. Gelinas work for the National Legal Center where they help people dealing with credit and debt problems. Creeden is a New Hampshire attorney with experience in consumer and debtor’s rights. Gelinas has over 20 years of experience in credit counseling, nonprofit debt management and debt resolution.
Both have helped clients unfortunate enough to follow the wrong financial advice on TikTok.
“There are a lot of people who are going to teach you things that they don’t fully understand,” Creeden said. “I see a lot of clients bringing or sending me links… and it’s really just terrible advice from someone who might have known a bit of information – just enough to be dangerous, that’s what I call it.”
According to Gelinas, FinTokers tend to give a lot of general information. Such advice does not take into account the level of risk to the viewer or how dire their financial situation may be. It can also skip some important specifics.
“It can easily get someone in trouble,” he said.
For example, one of Creeden’s clients saw TikToks about the snowball debt repayment method. It’s a popular strategy for getting rid of credit card debt that suggests paying off the cards with the lowest balances first to stay motivated.
Here’s just an example of a TikTok from @thecreditbrothers about the snowball method:
The Easiest Way to Pay Off Your Credit Card Debt: The Debt Snowball Method
♬ Original sound – Credit Brothers
The Creator didn’t say anything wrong, and thatworks for many people. However, @thecreditbrothers, like many others on FinTok, fail to mention that you still have to pay off all your other debts.
“Not everyone realizes that,” Creeden said. “Following a piece of information or advice without really understanding the whole scheme can really cause problems. That’s how I had it [a client] who decided to follow the advice of paying the smallest balance first. And so she stopped paying her taxes and her student loans.”
This, of course, immediately led to problems. As a result, the person who simply tried the snowball method had to use Creeden’s services.
The same creator, @thecreditbrothers, shared another piece of debt management advice widely shared on the platform:
@thecreditbrothers Have you ever paid a collection agency? #credithacks#creditrepair#credittips#debtcollector#debtinkasso♬ Original sound – Credit Brothers
Another Creeden customer decided to give it a try.
“They had no plan on how to deal with the debt or mitigate the risk,” Creeden said. “Then they came to us after being sued for multiple debts. And they just didn’t have a plan. Nothing.”
Creeden’s client felt no plan was necessary. They just followedon TikTok it seemed easy enough. However, according to Creeden, the advice was given without explanation of the risks and resulted in a garnishment that Creeden had to help against.
TikTok where every lawyer is
It can become even more dangerous if TikToker gives advice that interferes with the legal area.
For example, this TikTok from @ksmithcredit talks about the timeframe you have to respond to a debt collection lawsuit:
@ksmithcredit Here’s the first thing you need to do.. #credit#collections#lawsuit#gotserved♬ Original sound – Kenneth Smith Jr
However, response windows vary by state and the risks mentioned do not apply to all states. For example, Texas, South Carolina, and some other states don’t garnish debt collection wages.
“There’s no point in getting people to provide answers in all situations, and it can cost money,” Creeden said. “Filing fees can be high — $400 in some courts.”
This TikTok from @thedisputeher suggests you remove your valid addresses from your Experian credit report:
@thedisputeher This credit hack will help you remove negative accounts from your credit #experianbackdoor#creditrepairhacks#creditrepair#pushinp🅿️♬ pushin P (feat. Young Thug) – Gunna & Future
The idea is that the credit bureau also removes the negative accounts associated with those addresses. However, credit bureaus do not delete the information that is correct. In addition, even if this “hack” works, you risk losing the positive information associated with the removed addresses. So it could still end up following this advice.
TikTok creator @epiccreditscore offers legal advice in all states, although states have different laws.
@epiccreditscore#lawsuit#olddebt#debt#served#court#creditrepair♬ Original sound – Jla
In this TikTok, the creator suggests using the “statute of limitations” (referring to the period of time during which a company must take legal action against you) defense if a collection agency is suing you. This general legal tactic is common advice on TikTok, but it’s also misleading.
“It’s true that [statute of limitations] is an important aspect,” said Gelinas. “[But] it’s not always that easy.” According to him, it’s best to have a prosecutor review the case, as it can often be very complicated.
“I don’t advise anyone outside of the area where I can practice,” Creeden said. “If people who aren’t attorneys do it in all states, they’re more likely to give false information.”
The consequences, she said, can be severe and affect your wages and credit score.
“Be very demanding”
Does that mean you should never come to TikTok and social media for financial advice? Not necessarily.
Both Creeden and Gelinas agree that there are benefits to browsing money tips on FinTok. Creeden confirms that he enjoys using TikTok and finds some FinTokers incredibly positive and helpful: @travel credit acceptancefor example, is someone she follows and appreciates.
@journeycreditacceptance Truth About Credit Karma #BbStyleFearless#MACChallengeAccepted#GetTheWChallenge#finance#fyp#fypシ#creditscore#credit#finance#moneytok#foryou#creditreport#hypothek#auto#autoloan#bank#creditrepair♬ Original soundtrack – Journey To Credit Acceptance
Also, before the days of financial influencers, money advice wasn’t as accessible.
“My generation didn’t know much about credit or debt or … how to invest,” Creeden said. “You know, these are things we didn’t even discuss at school.”
Today, social media is changing. Teens can easily familiarize themselves with these topics by scrolling on TikTok. You can learn important financial terms and understand the basics of money. All they have to do to keep their wallets safe is stay alert.
There is no official body monitoring TikTok to verify that the creators are offering valid financial advice. The Consumer Financial Protection Bureau will not prosecute FinTokers that offer inaccurate information. It’s up to you to decide which advice to trust.
Gelinas recommends being “very hardworking… and very demanding.” If you find money advice on TikTok that you want to try, double-check it with multiple sources. Research the issue thoroughly before taking any action. It’s also a good idea to take a closer look at the creator. Are you a recognized expert in this field? What testimonies do they have to prove it?
Remember that personal finances are always important too personally. What works for others may not apply to your situation, especially if you are struggling financially. When you find yourself in a crisis, the best thing to do is to turn to a professional for help. You wouldn’t (or at least shouldn’t) go to TikTok for medical advice on a serious health issue. It’s wise to treat your financial health in the same way.