If you’ve scrolled on TikTok or Instagram lately, chances are you’ve seen someone offering “the best tips for financial freedom.” Perhaps, they want to inform you about all things crypto, side hustles, or early retirement strategies to help you with your financial choices. While this algorithm oftentimes sounds inviting and real, it is not quite what it seems. In fact, according to many financial professionals, what we see online is not so glamorous, and as workers, particularly government workers, we should be cautious about this unsolicited advice.
“Everywhere you turn, an influencer is promising the ‘secret’ to financial success with a swipe-up link to their latest ‘game-changing’ strategy. The problem is, social media algorithms don’t prioritize sound advice. They reward engagement, not accuracy,” Michael A. Scarpati said, CEO of RetireUS.
With social media dominating the financial industry, what is the solution to filtering out unverified financial advice? For RetireUS, Scarpati and his team are focused on closing that gap. Their mission aims to make it easier and more affordable for people, particularly government employees, to get financial advice from licensed professionals, especially compared to the risky advice seen on social media.
As a society, it is true that financial dependence on social media is not going away. According to the National Association of Personal Financial Advisors, more than one-third (39%) of Americans under 65 receive their financial advice from social media. In addition to that, more than 60% say they have acted on the advice, says the same source.
Also a financial expert, Scarpati knows far well that social media influencers are not at all regulated. That means they are not held to the same standards as trusted fiduciary professionals who are legally required to disclose conflicts of interest, follow compliance rules, and prioritize the needs of the client.
“It’s not a coincidence that most of these social media influencers—the voices gaining traction online—aren’t licensed or registered, and there’s a reason for that,” Scaparti added.
In an era where viral content trumps true expertise, financial misinformation can spread rapidly and carry long-term consequences. Poor investment decisions, early withdrawals, or misunderstanding retirement benefits can significantly derail someone’s financial plan, especially if they’re nearing retirement age or facing a job transition.
To support those at risk, Government Transition Decision HQ, a free crisis-response hub offering one-on-one support, educational webinars, and federal-specific financial tools, is available through RetireUS.
With the Federal Transition HQ, federal employees get access to reliable financial help in order to navigate their career with confidence. Included in the program is clarity to common questions, such as:
- Can I retire from the federal workforce early without long-term retirement risks?
- How do I calculate if DRP, VERA, or VSIP is right for me?
- Where can I access my FERS pension estimates?
- How does my early retirement affect my pension and health benefits?
Evidently, this kind of support is important, especially in today’s financial landscape. In a recent retirement income survey, most adults aged 50 to 75 lack knowledge about retirement income. Comparatively, only 15% of Americans have access to defined-benefit retirement plans. With RetireUS’s approach, however, they are making it more convenient for this population to seek the support they need.
In a nutshell, the financial industry is always undergoing digital transformation, but that doesn’t mean all online resources are the route to go. Instead, Scaparti suggests opting for a smarter approach–that is, one where it is rooted in caution and safety.
Next time you scroll on social media and stop to learn more about financial literacy, you might consider the chances you are taking. Because while an influencer with a persuasive personality, enticing facts, and trendy music in the background sounds incredibly tempting, you put your financial future on the line.
So, are you ready to begin financing successfully? Remember, your journey starts with a trusted financer, not on social media.