More than 70% of Gen Z retail investors in the UK now use social media as a source of information for their investment decisions, according to research from Charles Schwab UK.
This is a significantly higher proportion than other generations with just 60% of millennials, 36% of Gen X and 11% of Baby Boomers drawing on social channels for financial insights.
Richard Flynn, managing director at Charles Schwab UK, said the volume of financial information available to younger investors has led to the creation of “online investment communities, with finfluencers and social media playing a much more important role in the investment process”.
Indeed, the survey found that 53% of Gen Z investors think that financial influencers (finfluencers) are more important to their investment decisions than traditional financial media. A further 62% said they were increasingly reliant on discussions in online communities and forums for their investment advice.
Despite the rise of social media among Gen Z investors, 67% of the age group still considered financial advisors and professional fund managers to be the most important source of information when making investment decisions, as demonstrated by the chart below.
Source: Charles Schwab UK
Flynn added: “The increase in the number of sources that provide investment information means it is becoming increasingly important that young investors know what they can and cannot trust. It is therefore reassuring that our research shows Gen Z still recognise the benefits of proactively seeking professional advice.”