Americans are increasingly spending their time online as we
continue to face social distancing restrictions due to the ongoing COVID-19
pandemic.
According to recent research, 39% of Americans say they’ve
relied more on their cell phones during the pandemic due to social distancing
requirements and travel restrictions.
But the reliance on phones and other mobile devices extends
beyond entertainment and staying connected to loved ones—it’s changing how
Americans control their money, with a majority of those under the age of 65
(71%) reporting that they have changed how they manage their finances in the
last year.
Social networking platforms like Instagram and TikTok are
growing in popularity among all generations and are serving as a go-to resource
for financial information.
20% of Americans say they use social media as a top resource
for financial information and one-third say they trust social media content to
help them make financial decisions. One-third of Americans also say they trust
social media influencers and celebrities for financial advice.
The reliance on social media for financial information could
have real implications for Americans’ financial wellbeing, especially as more
than half of US adults say their household finances changed significantly due
to the COVID-19 pandemic and one in three say their finances were negatively
impacted.
44% of households making less than $50,000 a year say it is
unlikely they will be able to save more for retirement going forward,
highlighting the long-term financial impact of the pandemic.
The utilization of social media for financial advice coupled
with the hardships of the pandemic means there is a significant need – and
opportunity – for the financial services industry to help improve Americans’
financial outcomes and provide trusted, digital financial tools.
First, technologists within financial service providers need
to have a clear understanding of where consumers are looking for information.
While there is an increased reliance on social media, 63% of survey respondents
still say financial services providers’ online tools are the most trusted
resource for financial advice, and three in ten say they are interested in
using digital tools that aggregate information across their financial accounts.
Americans are also more likely to use new devices like home
voice assistants, smartwatches, and their financial provider’s chatbots to help
manage their finances. Understanding how to reach multigenerational audiences
across platforms is key to improving financial wellbeing.
Financial services leaders should also encourage consumers
to consult a variety of trusted resources before making financial decisions.
While sound financial advice is available online — including on social media –
seeking advice from multiple sources and understanding how that advice applies
to individuals’ own financial wellness is critical before they make any
decisions.
Financial acumen is also key to helping more Americans
rebound from the economic impacts of the pandemic. Increasing access to online
financial educational tools like retirement saving calculators, tips for
contributing to an emergency fund, and advice for managing multiple types of
debt will help consumers learn more about how to manage their financial health
and wellbeing.
Encouraging regular financial health check-ups online or
in-person can also improve financial outcomes and is something that more than
half of those under the age of 65 say they’re interested in receiving.
Social media is great for keeping us connected and
entertained as we continue to navigate the impact of COVID-19 on our daily
lives, but social networks, influencers, or celebrities are not always the
appropriate resources for tailored personal financial advice.
It is up to financial services companies to provide the
tools and technology to meet customers where they are online, help identify
trusted resources for financial advice, and ultimately improve financial
outcomes.
Click here for the
original article.