TikTok's finfluencers: How reliable is the financial advice reaching young investors?

"Defence stocks make millionaires 95% of the time," a man tells his followers in a TikTok video before pointing viewers towards a handful of companies in the defence sector.

It's one of several videos offering investment tips: some feature creators while others use AI-generated personas to offer stock picks and financial advice to users scrolling through social media in Europe.

But how much of this advice should you actually trust?

A new analysis of 150 popular finance-related TikTok videos by broker comparison website BrokerListings.com suggests that viewers should be cautious.

The videos it studied amassed at least 100,000 views each, covering topics ranging from stocks and cryptocurrency to debt and personal finance.

The platform found more than 70% of the videos' creators did not display a clear relevant background in financial services or suitable qualifications sufficient to provide reliable advice to the public.

In addition, more than 60% of the videos did not adequately explain the potential risks or downsides to the financial products or situations they discussed.

Their findings come as regulators are increasingly grappling with the influence of social media on young investors.

Ulf Linke, a consumer protection expert at Germany's financial regulator BaFin, told The Cube, Euronews’ fact-checking team, that the authority sees a "clear trend" towards investment tips on social media, particularly among younger people.

A 2024 BaFin survey found that more than half of Millennial and Gen Z investors considered social media a reliable source of financial information, while 60% saw it as a good alternative to professional financial advice.

In April, the European Parliament backed calls for minimum standards for so-called "finfluencers" — influencers who provide financial advice on social media — specifically citing risks such as hidden advertising, misleading claims, scams, and AI-generated financial content.

According to MEPs, social media has become a "primary" source of financial information for many younger people.

The European Securities and Markets Authority (ESMA) also issued guidance for finfluencers earlier this year, warning that rules on investment recommendations can apply to financial content posted on social media.

Under these rules, someone recommending an investment may need to make clear who they are, separate facts from opinions and disclose if they could financially benefit from what they are promoting.

Even publicly expressing an opinion on whether a share or cryptocurrency will rise or fall can, in some circumstances, constitute an investment recommendation.

"Disclaimers such as 'This is not investment advice' will not protect you in these cases," ESMA states.

Why can financial advice on TikTok be risky?

The format of social media clips is one of the main reasons why they are a precarious source of financial or budgeting information, researchers say, as their short length can mean that a lot of important context is left out.

According to James Barra, head of content and research at BrokerListings, the nature of short-form videos on platforms such as TikTok and Instagram does not necessarily lend itself to the kind of longer, balanced explanations that financial products can require.

A short video promoting a side hustle or get-rich-quick scheme may be more engaging, he said, than a longer explanation weighing up both the potential benefits and risks.

The advice can also reach people with vastly different levels of financial knowledge and experience.

A particular investment, for example, could represent a relatively small proportion of an experienced investor's portfolio, but be much riskier for a young investor putting a large share of their savings into it.

"And that sort of nuance… you don't necessarily have room for that in these short-form videos on TikTok," Barra told The Cube.

BrokerListings also found that the most concerning content did not necessarily come from TikTok's biggest financial influencers.

Barra said larger influencers and commercial partnerships have attracted greater scrutiny from regulators and social media platforms, while smaller, organic creators can also produce content that reaches substantial audiences, but receive less scrutiny.

TikTok told us that its Community Guidelines on regulated goods, services and commercial activities set out rules that apply to this type of content. The platform said it takes enforcement action, including removing content, when it is found to violate those guidelines.

TikTok also prohibits financial scams and said that 99% of videos it removed for violating its fraud and scams policies in the first quarter of 2026 were taken down proactively before being reported by users.

Is it all unreliable?

Despite concerns, not all financial content on social media is unreliable. BrokerListings says its researchers also found creators sharing useful information on topics such as budgeting, managing debt, building emergency savings and long-term investing.

It can also offer an alternative means for young people learning about personal finance.

"You don't learn about this at school, you don't learn about it at university," Barra said. "A lot of people don't learn about it from their parents.

There are also established financial education channels which take a different approach to the quick stock picks and promises of high returns found elsewhere on social media.

For example, Germany's Finanzfluss ("Financial flow", in English), presented by former investment banking analyst Thomas Kehl, has built a large online audience around financial education, producing content on topics including ETFs (exchange-traded funds), investing basics, saving and retirement planning.

In one recent TikTok, the channel discusses the growth of actively managed ETFs in the US and Europe, explaining the product and market developments rather than directing viewers towards a particular stock and promising them they will make a return.

How can you spot unreliable financial advice online?

Nevertheless, experts warn that users should look closely at who is behind the financial content they are watching.

According to Linke, reputable creators should identify themselves, provide verifiable contact information, disclose potential conflicts of interest and explain the professional background that qualifies them to discuss investments.

If this information is missing, investors should not trust the investment tips, he added.

Linke also warned users to be suspicious of tips promising high returns without explaining the risks, and to not give in to pressure or the fear of missing out on potential returns.

Another warning sign, according to Barra, is content built around displays of wealth, such as expensive cars, luxury hotels or other suggestions that following a particular investment strategy could lead to a similar lifestyle.

Urgency should also raise questions. Barra pointed to videos telling viewers that a stock is about to soar or crash, or those suggesting they have only a short window in which to buy a particular cryptocurrency.

Social media users should also consider if a creator is benefiting financially from what they are promoting, with some creators receiving commission when a viewer signs up to a trading platform through their link.

Such sponsorships or affiliate relationships do not mean the information is unreliable, but European rules require such conflicts of interest to be disclosed.

ESMA recommends that consumers check information from social media against other sources before making financial decisions.

That could mean looking at information published by financial regulators such as ESMA or national authorities such as Germany's BaFin; checking official company reports if a video makes claims about a particular business; and looking for coverage from established financial news organisations.

Investors can also use national regulators' registers to check whether a company or individual offering financial services is authorised to do so.

Ultimately, the speed with which users can move from watching a TikTok to putting their own money at risk makes that scrutiny increasingly important.

Barra described how someone could watch a video recommending several stocks, ask an AI chatbot whether they were good investments and then open a trading app and buy them, all within a matter of minutes.

"The whole journey can be a lot quicker than it used to be," he said.

Reporting from euronews contributed to this story.