UK Investors Rely on Unregulated Sources for Financial Decisions

Strategic Insights -

As the UK's investment market continues to grow, a significant number of investors are turning to unregulated sources, such as social media and finfluencers, to inform their financial decisions. Despite nearly 50% of consumers trusting financial advisers, nearly two-fifths of UK investors have used social media to inform financial decisions over the past two years, according to research from Fidelity International. The findings highlight a worrying trend of investors relying on unverified sources, which could result in poor financial decisions.

Key Takeaways:

  • Nearly two-fifths (40%) of UK investors have used social media to inform financial decisions over the past two years.
  • Only one in three (33%) respondents had used a qualified adviser in the past two years to inform a financial decision.
  • More than 60% of respondents had never accessed the advice system, indicating many were unable to access professional advice.
  • 12% of survey respondents gathered information from finfluencers on social media platforms, including X, Instagram, and TikTok.
  • The Financial Conduct Authority has taken action against nine individuals for promoting an unauthorised trading scheme and made three arrests during an action week in June.
  • 50 alerts were issued, resulting in over 650 requests to remove content from social media, according to the FCA.
  • 13% of respondents trusted top results on search engines for financial guidance.
  • 11% and 8% of investors chose web forums and AI for financial guidance, respectively.
  • Over 20% of Gen Z and millennials trusted finfluencers, AI, and podcasts over trusted sources for financial information.
  • A quarter of investors reported buying a product only hours after considering a new fund or stock.
  • The risk of relying on non-authorised sources is real and could result in poor financial decisions, according to Andrew Oxlade, investment director at Fidelity International.

Statistics:

  • 2,000 UK investors were surveyed by Fidelity International.
  • 40% of respondents used social media to inform financial decisions over the past two years.
  • 33% of respondents used a qualified adviser in the past two years to inform a financial decision.
  • 65% of respondents had never accessed the advice system.
  • 12% of respondents gathered information from finfluencers on social media platforms.
  • 13% of respondents trusted top results on search engines.
  • 11% and 8% of investors chose web forums and AI, respectively, for financial guidance.
  • 20% of Gen Z and millennials trusted finfluencers, AI, and podcasts over trusted sources.

Sources:

  • Fidelity International survey of 2,000 UK investors.
  • Financial Conduct Authority action week in June.
  • Schroders Personal Wealth research on barriers to accessing financial advice.