Social Media Is Full of Lousy Money Advice

To kick off summer, we figured it was the perfect time to take another dip into our favourite guilty pleasure: social media. While it can be entertaining, it’s also overflowing with questionable financial advice.

We’ve already helped clients unpack some of the more dubious money tips making the rounds online — but the bad advice just keeps coming. So here’s a fresh batch of financial myths we’re busting this season:

It only takes a few swipes to find a FinTok creator hyping leveraged ETFs. These high-risk funds aim to multiply the performance of an index or stock. For example, a 3x leveraged ETF tracking $QQQ would rise 6% if $QQQ gains 2% in a day — and fall 6% if $QQQ drops 2%.

Some creators pitch these funds (videos like this one) as a foolproof daily moneymaker, no matter what the market does. The reality? Most leveraged ETFs reset daily and aren’t designed for long-term holding. They don’t compound like traditional ETFs, and holding them for longer than a day can magnify losses in unpredictable ways.

In April alone, retail investors lost US$25.7 billion in leveraged ETFs during a short market downturn.¹ Know what you’re getting into before you dive in.

FinTok is full of creators  (such as this one) promising fast wealth through real estate — especially by investing in real estate investment trusts (REITs). REITs are companies that own or finance income-generating properties.

While they can diversify your portfolio and offer attractive yields, they’re not a shortcut to “penthouse living.” According to economist Jeremy Siegel, REITs delivered a 9.7% annualized return from 1971 to 2021 — solid, but still shy of the 11% return from the S&P 500 over the same period.²

REITs have their place in a portfolio, but like any asset, they’re not magic.

As economic anxiety grows, so do the “feral finance” hacks on TikTok — things like pocketing office supplies or starting drama to avoid expensive social outings.

Sure, cutting spending is a valid way to save, and we don’t knock anyone for trying. But let’s be honest — these strategies won’t move the needle much. Want a better approach? Set up automatic transfers on payday. Move money to a savings account before you even see it in your chequing.

Saving works best when it’s consistent, not chaotic.

Any video that begins with “you’re an idiot if you’re not buying these stocks” should trigger your internal alarm. The person behind the video doesn’t know your goals, risk tolerance, or time horizon — and likely isn’t accountable if their picks flop.

Chasing hot stocks is tempting, but history shows the best-performing stocks in one year often underperform the next. Even Warren Buffett, one of the world’s most successful investors, recommends low-cost index funds for most people.

Trying to beat the market often means buying what others are ignoring — not what’s trending.

Social media can be a fun place to find ideas, but it’s no substitute for a personalized financial plan. True clarity comes from thoughtful conversations with someone who understands your goals, risks, and future.

We're here to help — not just with tips, but with strategy.

Let’s build your plan, together.

1 Source: Bloomberg, “Leveraged ETF Traders Lost $25.7 Billion in April’s Rout,” USD figures, April 2024.

2 Source: Jeremy Siegel, Stocks for the Long Run (6th Edition). Annualized returns are based on U.S. market data from 1971 to 2021. All returns are in USD and reflect historical performance only.

This document is provided as a general source of information and should not be considered personal, legal, accounting, tax or investment advice, or construed as an endorsement or recommendation of any entity or security discussed.All investments involve risk, including the potential loss of principal. Leveraged ETFs and other complex investment vehicles may not be suitable for all investors and should only be used with a full understanding of their risks. Asset class performance varies over time, and diversification does not ensure a profit or protect against a loss. Every effort has been made to ensure that the material contained in this document is accurate at the time of publication. Market conditions may change which may impact the information contained in this document. All charts and illustrations in this document are for illustrative purposes only. They are not intended to predict or project investment results. Individuals should seek the advice of professionals, as appropriate, regarding any particular investment. Investors should consult their professional advisors prior to implementing any changes to their investment strategies. The opinions expressed in the communication are solely those of the author(s) and are not to be used or construed as investment advice or as an endorsement or recommendation of any entity or security discussed. Mutual funds and other securities are offered through De Thomas Wealth Management, a mutual fund dealer registered in each province in which it conducts business and a member of the Canadian Investment Regulatory Organization (CIRO).