Social media has become an integral part of our lives. It helps us stay connected with friends and keep up with news, deals, and trends. All great things! Social media’s not all good news though. It can also have negative impacts on various parts of our lives. One of which is our financial health. Understanding the different aspects of social media and how to manage them is essential.
How have the worlds of social media and finances mixed
Social media affects our finances in many ways. Advertisers use social media as a platform to promote their products, as they do on TV and in magazines. The advantage of social media is that it allows for faster and economically friendly communication and sales.
- Data mining and targeted ads. When you create a social media account, you’re required to agree to their terms and conditions. These allow them to store your data, which they use to suggest content that may interest you.
- Influencer marketing. Businesses use social media influencers to promote products and services.
- Social proof advertising. Positive reviews and comments about a product can make people trust the company and decide to buy the product.
The connection between financial health and mental health
The connection between money and mental health is no secret. Being in debt raises the odds of experiencing depression and anxiety. Your mental health may suffer if you’re worried about money or lack a financial plan. The CDC finds indicate that 15.8% of people living below the poverty line report signs of depression.
Mental health conditions may make it harder to control your spending, pay bills, or meet financial goals. Depression and anxiety can create a double edge sword that is detrimental to a person’s finances. Feeling low or depressed can reduce productivity, making it more difficult to make ends meet. Also, spending may give you a brief high, so you might overspend to feel better. Stress resulting from financial problems is often chronic because of this repeated cycle of feeling low because of limited means and then spending to feel better.
Trends seen because of financial and social mixing
Social media usage in Canada has been consistently growing. There are currently 34.47 million social network users nationwide. Almost 95% of Canadian adults use at least one platform, making Canada one of the world’s most connected online populations.
According to Statistics Canada, 82% of Canadians shopped online in 2020, an increase from 77% in 2018. Online spending increased by approximately 50% during this time, from $57.4 billion to $84.4 billion.
Pros
There are ways social media can provide financial benefits to its users.
Job Opportunities
Social media can help you connect with people and organizations you’re interested in. Following their pages can give you access to job opportunities.
Offers and Discounts
Offers, coupons, and discounts can help you save money on items you regularly buy. Many businesses announce deals on social media, so it’s worth following them to access exclusive offers.
Target Marketing
Target marketing means promoting your product or service to a specific group of people who are likely to buy it. Social media targeting is a way to reach these people on social media with advertising.
Affiliate Marketing
Social media presents chances for people to make extra cash through affiliate programs. Use these opportunities to increase your net worth, but it’s best to be mindful of what you promote.
Cons
Here are a few of the less favourable aspects of social media.
Overspending
Social media can tempt us to buy things we don’t need. There are a lot of ads on social media, and companies use videos and articles to convince us to buy their products. This may lead to poor financial health and credit card debt.
Seeing our friends’ posts about their new cars, clothes, and experiences can make us feel like we need those things too. This can lead to spending a lot of money to match our friends’ lifestyles.
Scams
Many people who report losing money to fraud say it started on social media with an ad, a post, or a message. Scammers operate in many ways. According to the Canadian Anti-Fraud Centre, victims of romance scams have reported millions of dollars lost. In fact, romance scams accounted for more than $42.2 million lost in 2021 alone.
Data privacy
Social media can also leak personal information like your name, address, phone number, email address, date of birth, and even financial information. It’s important to be careful about what you post and who you share it with.
How to effectively use financial info on social
Tips on how to use social media to achieve better financial health:
- When it makes sense, stretch your income by taking advantage of discounts and offers
- Use it to research and compare financial services and products
- Connect with reliable financial advisors and institutions to get free tips, identify opportunities, and learn basic financial skills.
How to negate the bad side effects
You can take steps to protect your financial and mental health from the harmful effects of social media.
Here are some tips for using social media in a healthy way:
- Be selective with who you follow. Unfollow those who promote expensive lifestyles or bad financial advice.
- Consider joining reliable groups that share tips on how to increase cash flow, improve a credit score, and achieve financial wellness.
- Regularly take time away from the Internet, especially social media. This will let you reset and reduce the chances of FOMO affecting your finances.
- Flip the script and increase your income by starting an online business. You can use social media to promote your own business and engage with your customers.
Conclusion
Social media has become a big part of many people’s daily routines. It helps us stay connected with friends, see what’s happening, and find good deals. On the other hand, social media can also harm our financial and mental well-being. It’s crucial to understand the positive and negative impacts of social media.
Are you tired of being in debt? Contact us at any time. One of our trained credit counsellors is ready to help you find debt relief and improve your financial health today.
