Kathy
in Memos & Musings · 3 min read
Background
Since last night, we have received a number of messages from fellow financial influencers who saw the news that Financial Influencers must be regulated to provide financial advice.
For most Finluencers this should not be a cause of concern if they usually word their presentation in a clear and unbiased manner without specific buy/sell recommendations to any securities. In fact this is nothing new and it has always been the case that the provision of financial advice is a regulated act in Singapore.
For those who have stayed away from these areas, there is no need for concern. We believe the authorities’ intent is not to stifle investment discussions but to ensure the public has a safe and constructive environment.
With that in mind, it may be more important to address the key issues at hand and the underlying intent behind this recent news.
The article suggest that more could be done to avoid investors being misled by finfluencers and we totally concur with such a move.
Who are the Finluencers?
Before we go on further, let’s define who is a finfluencer: A personal finance influencer, is known as a “finfluencer,” and is someone who uses social media platforms to share tips, strategies, and insights about managing money with their followers.
Although some finfluencers have professional backgrounds in accounting or financial services—this obviously isn’t a requirement to become a finfluencer.
What Do Finfluencers Do and the +/-
+ Generally finfluencers produce content on a wide range of financial topics, which they often make available for free. This content can include blog posts, social media posts, podcasts, guides and books.
+ On the ground, we hear from the public that most finfluencers in Singapore have created accessible resources that help people improve their financial literacy and make better informed financial decisions.
On the other hand, being engaged closely with many retail investors over the years, some have also shared their candid, heartfelt thoughts with us about certain aspects of finfluencers that may not sit well with them personally:
– Pushing Too Many Paid Promotions
While personal finance influencers may derive income through affiliate marketing/ sponsored posts, problems arise when their content becomes overly promotional. Some influencers may also promote products they haven’t personally used and their main focus becomes making money rather than providing genuine recommendations.
Inevitably, these finfluencers may turn into “product peddlers,” serving as spokespeople for any brand willing to pay. In some cases, finfluencers may even own separate marketing companies, using financial topics as a front to drive product sales and guest speaker engagements.
– Preying on Financial Anxiety
Another troubling trend among certain finfluencers is their tendency to prey on financial anxieties. By leveraging followers’ greed, they promote their own strategies as the only way to achieve financial success. Often, they market “guaranteed” results, pushing high-risk tactics or shill certain securities. Red flags may include creators who promote rapid wealth-building methods without considering alternatives, or insist that their approach is the only viable investment strategy.
Such finfluencers can be harmful, as their advice may lead vulnerable followers to make hasty financial decisions driven by greed or a fear of missing out (FOMO). Such one-sided perspective can mislead followers, especially those new to investing, leading to poorly informed financial choices.
– Credentials Are Good, But May Not Always Help
A common misconception is that credentials automatically make a financial influencer more trustworthy. While a license or educational background in finance can be helpful, it doesn’t necessarily mean the person’s advice is infallible. Credentials can indicate a certain level of foundational knowledge, but even licensed professionals can sometimes (often) provide advice that doesn’t age well in social media.
For instance, we heard from many retail investors shared that some of them also tend to promote certain securities during market highs and become overly pessimistic during market lows, potentially encouraging followers to buy high or sell low based on herd mentality on most occasions. In truth, some financial advisors are indeed more successful in selling advice than in generating wealth from the markets themselves.
Conversely, some finfluencers without formal qualifications can provide valuable insights drawn from personal experience and a deep understanding of financial topics. These finfluencers can simplify complex financial terms into understandable, actionable advice, often resonating with a broad audience, as seen on platforms like InvestingNote.
While credentials can add a layer of assurance, they are not the sole indicator of good financial guidance. Wisdom and sound advice can come from both credentialed professionals and those with practical knowledge of personal finance.
Our Values at TJI as a Responsible Finfluencer:
At The Joyful Investors, our commitment to editorial integrity guides our approach to financial content. For years, we have chosen not to endorse products that we don’t personally use or that we believe may not truly benefit investors. We avoid recommending products that lack a sensible risk-reward balance or that could mislead our audience, ensuring our content remains factual and grounded in practical knowledge.
Our team also includes licensed professionals authorized to provide financial advice, which helps us maintain compliance and make thoughtful, informed decisions.
Additionally, we are cautious about trends, choosing not to follow those we see as unsustainable. For us, the financial well-being of our audience always takes priority over expanding our reach.
Closing Thoughts:
In short, navigating the world of personal finance influencers requires discernment and a critical eye. True learning is not following blindly to any single source but absorb what is useful to you and discard what is not. It’s essential to stay alert to hidden agendas, such as overly promotional content or influencers preying on financial anxiety.
By balancing caution with informed decision-making, you can navigate this landscape in a way that supports your financial health and goals.
P.s. This article is based on general observations of the finfluencer space and does not refer to any specific individuals or products.
About Kathy
Co-Founder of The Joyful Investors and Manager of The Moneyball Portfolio. I graduated with a degree in Economics in National University of Singapore (NUS). My previous experience with traders at the Merrill Lynch enable me to realize many counter-intuitive truths about how the financial markets work and to uncover the challenges faced by many new investors. We believe that investing can be astoundingly simple and want to make financial education understandable for everyone.
Important Information
This document is for information only and does not constitute an offer or solicitation nor be construed as a recommendation to buy or sell any of the investments mentioned. Neither The Joyful Investors Pte. Ltd. (“The Joyful Investors”) nor any of its officers or employees accepts any liability whatsoever for any loss arising from any use of this publication or its contents. The views expressed are solely the opinions of the author as of the date of this document and are subject to change based on market and other conditions.
The information provided regarding any individual securities is not intended to be used to form any basis upon which an investment decision is to be made. The information contained in this document, including any data, projections and underlying assumptions are based upon certain assumptions and analysis of information available as at the date of this document and reflects prevailing conditions, all of which are accordingly subject to change at any time without notice and The Joyful Investors is under no obligation to notify you of any of these changes.
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