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Monday 27th May 2024

Must-know money: A fifth of young investors take tips from Instagram

Richa Ved explores social media investment, mortgage-rent shift, and concerns over the UK’s switch to a cashless society.

young investor looks at Instagram

From ‘finfluenced’ young investors, to the difference between mortgage and rent costs, and concerns over the UK’s switch to a cashless economy – here are our favourite must know money stories this week to help you get your head around your personal finances.

A fifth of young investors take tips from Instagram

One in five (21%) of investors aged 18-34 get stock tips and market forecasts from Instagram, according to an Opinium survey carried out for Hargreaves Lansdown.

The survey also found 16% young investors use financial advice found on Facebook, 14% on Reddit, and 8% on TikTok. However, for investors aged 55+, these numbers dropped to 0%.

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Financial websites are a popular across all investor age ranges, employment status, and geographical regions in the UK. Following that, newspapers and specialised financial publications are a common source – though lesser with younger investors who tend to turn to social media for ideas more frequently.

 Age
18 – 3435 – 5455+
Websites of financial companies32%35%34%
Friends and family27%30%19%
Specific financial publications27%13%20%
Instagram21%9%0%
I come up with them myself18%23%24%
Newspapers18%12%29%
Facebook16%12%1%
Emails from financial companies15%11%9%
Reddit14%6%0%
TV13%13%5%
LinkedIn12%7%1%
Radio10%12%5%
TikTok8%6%0%
Other (please specify)8%14%23%

Source: Hargreaves Lansdown

Emma Wall, head of investment analysis and research at Hargreaves Lansdown, said: “The most important factor when looking for investment ideas – regardless of your source – is that they are right for you, and your personal financial plan. Those readying themselves for retirement probably shouldn’t be invested in the same portfolio as a Gen Z investor who is in their first job.”

She added: “While engagement with investing should be applauded at any age, taking tips from unregulated or unverified sources, such as social media, should be done with caution. Always take time to do additional due diligence on any ideas. If you are at a pivotal life event – retirement, marriage, becoming a parent, and you are really short of investment ideas, consider getting professional advice before taking the plunge.”

Buying more expensive than renting for the first time in 13 years

Buying has become more expensive than renting for the first time in 13 years, reports Melissa Lawford for The Telegraph.

Two years ago, a first-time buyer would have saved £245 per month if they purchased a property rather than rented it, according to property website Zoopla.

Now, first-time buyers have to pay an extra £122 per month on a mortgage compared to rent on the same property. In London, where house prices are highest, mortgage is more expensive by £493 per month.

House prices have dropped by the biggest amount in five years, as high mortgage rates ward off potential buyers. Experts said this lower first-time buyer demand would contribute towards further house price falls.

Rupert Simmonds, regional director at estate agents John D Wood & Co, said: “First-time buyers are assessing whether the benefits of owning a property outweigh the financial strain posed by higher monthly mortgage payments, along with the associated costs of property maintenance and upkeep.

“Some are deciding to move further out from city centres to more affordable neighbourhoods where the gap between renting and buying might be narrower. Others are seeking guidance on innovative financing options or entering the market with co-buyers to distribute the financial burden.”

Concerns over the UK’s switch to a cashless society

The UK’s rapid shift to a cashless society is causing concerns to not only the elderly but also to those on lower incomes, tourists, and ones who would like to keep a tight control on spending, reports Shane Hickey for The Guardian.

A Royal Society of Arts report last year found that over 10 million Britons would struggle to live in a cashless society, with many losing control of their finances and seeing debts spiral.

Older people have been prone to isolation in this shift towards a cashless society. They claim they feel left behind as they lose the reliability and straightforwardness that cash offers, and struggle with concerns over technology usage and potential frauds.

Furthermore, recent figures from the banking body, UK Finance, show that newer ways of paying are set to almost completely eclipse cash within a decade, expecting cash to account for only 6% of all payments made in the UK by 2031.

A cash-favouring tourist was frustrated after having to make bank payments despite having cash to pay with – ultimately being charged £73 more in debit card transaction fees. He said: “I was only able to use currency at the restaurants, pubs and taxis. It is indeed a fine way for banks to profit.”

While online payments are increasingly popular, it has its own limitations – making it more important to allow access to cash payments, so that no one is left vulnerable behind.

Photo Credits: Pexels

Richa Ved

Richa is a young Indian graduate from Warwick Business School, aspiring to find her niche in the media industry. She has a passion for writing and a keen interest in financial affairs. If you don’t find her working, she’s probably having a pizza (her favourite!) and a pint of beer somewhere.

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