How to become a millionaire in three steps? An experimental study on the persuasive power of financial advice by finfluencers

Abstract

How to become a millionaire in three steps? An experimental study on the persuasive power of financialadvice by finfluencers Financial influencers, or finfluencers, are giving online financial advice to their followers. Although concerns about the impact of this advice on young adults are rising, scientific research is scarce. This experiment (N= 162) examines how investment advice impacts upon Dutch young adults’ perceived financial self-efficacy and financial well-being and how this advice can affect financial risk taking and willingness to invest. The results show a direct negative impact of a video that warns about the risks of http://creativecommons.org/licenses/by-nd/4.0 investing in shares on perceived future financial security and willingness to invest (compared to a control video). However, at the same time, this video had a positive indirect impact on financial decision-making (i.e., higher perceived financial self-efficacy, higher intent to invest and more willing to take risks), but negative effects on financial well-being (i.e., increased financial stress), through a more positive attitude towards the finfluencer.