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Not long ago, making an investment decision making process meant opening a brokerage account, calling a financial advisor, or poring over company reports and analyst recommendations. It was slow, methodical, and often intimidating. Today, for millions of investors, that same decision is made with a scroll and a swipe—through financial influencers on TikToks, Reddit threads, and YouTube thumbnails offering “Top 5 Stocks to Buy Now.”

Social media has radically transformed how people make investment decisions. It’s not just about access to information—though that’s certainly part of it—but about the context in which that information is delivered. Speed has replaced deliberation. Emotional cues now drive financial behavior. And for many investors, the crowd’s opinion holds more weight than an analyst’s.

This article explores how social media has disrupted traditional investment decision-making, reshaped behavior across age groups, and introduced a new set of risks and opportunities. We’ll compare today’s investor landscape with what came before—and ask whether the crowd’s wisdom is really wiser than the old-school playbook.

The Way It Was: A World of Experts and Patience

Before the rise of social media, investors largely relied on institutional guidance. Financial advisors, mutual fund managers, and legacy media like CNBC or The Wall Street Journal shaped the narrative. Data came from earnings reports, company filings, or trusted newsletters. Strategies emphasized long-term planning, diversification, and managing risk based on fundamental analysis.

The decision-making process was slower but more insulated from noise. Investors bought index funds, like the S&P 500 tracked blue-chip stocks, and measured performance over quarters or years—not days. There was little incentive to “act now” unless you worked on a trading floor.

Even online brokerage forums in the 2000s, like Bogleheads or Motley Fool, promoted caution and education. While chatrooms existed, the tone was subdued, and recommendations often came with disclaimers. The idea of making trades based on viral content would have been absurd.

The Shift: Social Media Takes Center Stage

That change began to take shape in the late 2000s but accelerated dramatically after the launch of mobile trading apps like Robinhood, which was founded in 2013 and launched to the public in March 2015. Robinhood helped popularize commission-free online trading and introduced a game-like user experience that appealed to a younger generation. This innovation helped normalize frequent trading among new investors and set the stage for the explosive growth of social-driven investing seen in the early 2020s.

Between 2018 and 2020, social media platforms like TikTok and YouTube began prioritizing short, algorithmically boosted content that favored engagement above all else—a shift that would soon extend to financial topics. By 2020, finance-related videos on TikTok, often tagged under #StockTok or #CryptoTok, were gaining millions of views. Finfluencers began regularly posting stock tips, cryptocurrency forecasts, and “passive income” ideas designed to go viral. The combination of fast-paced visuals, bold claims, and simplified explanations made investing feel both accessible and urgent—especially to a younger audience already accustomed to consuming content this way.

On YouTube, the trend began gaining traction around 2017, when financial influencers like Graham Stephan and Andrei Jikh started building large audiences with content focused on real estate, stock investing, and personal finance. Their channels grew steadily until 2020, when the COVID-19 pandemic, stimulus checks, and extra time at home fueled a surge in interest in personal finance and retail investing. The financial influencer, Graham Stephan currently has over 4.5 million subscribers, and his most viewed video—’How I Bought a Tesla for $78 Per Month’—has surpassed 10 million views. Andrei Jikh, whose style blends magic tricks with investing advice, has over 2.3 million subscribers, with his most popular video, ‘How to Invest in 2023 (Beginner’s Guide),’ drawing more than 4.5 million views.

Reddit’s r/WallStreetBets, founded in 2012, remained niche until late 2020. But in early 2021, it exploded into the mainstream during the GameStop short squeeze, effectively turning meme-based speculation into a global investing movement. As of 2024, the subreddit has over 13 million members, making it one of the largest and most influential financial communities on the internet.

The result? Investment decision processes that once relied on research and consultation now hinge on virality, confidence, and peer validation.

In a 2022 study from FINRA and NORC, 34% of investors aged 18–29 said social media was one of their most trusted sources of investing information. Even more striking, 8% of those aged 18–29 said they made their first-ever investment based on a tip from TikTok.

These platforms aren’t just delivering content. They’re shaping behavior. Research from the CFA Institute shows that Gen Z investors—typically defined as those born between 1997 and 2012—are more likely to trust online influencers than traditional financial institutions. Forty-eight percent of Gen Z investors say they invest “for fun,” and 44% admit to making investment decisions based on “gut instinct” or online excitement.

A separate 2023 survey by MagnifyMoney found that 59% of all investors who follow financial influencers on social media had made an investment based on that influencer’s recommendation. Of those, 36% later regretted their decision. The same study reported that younger investors (aged 18–34) were more than twice as likely as older investors to act on influencer advice without doing additional research.

Case Studies: GameStop, Dogecoin & Terra (LUNA)

Few events illustrate this transformation better than the GameStop saga of early 2021. A movement that began as a joke on r/WallStreetBets morphed into a global news story. Retail investors, fueled by a mix of anti-Wall Street sentiment and internet humor, drove GameStop shares from under $20 to over $400 within days. Hedge funds with short positions lost billions. It wasn’t just a market event—it was a cultural moment, complete with Reddit memes, TikTok explainer videos, and livestreams tracking the price in real time. Retail investors made up nearly 60% of GameStop’s trading volume at the peak.

The same year, cryptocurrencies saw a similar boom in social-driven trading. Dogecoin, a token initially created as a joke, surged over 15,000% from January to May 2021. The rally was propelled largely by Twitter posts from Elon Musk, TikTok trends, and Reddit speculation. There were no earnings reports or fundamentals to analyze—only hype.

Another example came with the rise and fall of Terra (LUNA) and its algorithmic stablecoin, UST, in 2022. Promoted heavily by crypto influencers on YouTube and Twitter, UST was marketed as a “safe” way to earn yields over 20%. When the peg broke in May, $60 billion in market value vanished in less than a week. Many retail investors who relied on influencer guidance were wiped out, often with little understanding of the risks.

Even YouTube has played host to “pump-and-dump” schemes disguised as financial advice. In late 2022, the SEC charged several YouTube influencers with fraud for using their platforms to manipulate stock prices, while failing to disclose their own financial interest in the stocks they promoted.

A Different Kind of Decision-Making

So what exactly has changed in how people make investing decisions?

First, there’s a shift from slow analysis to fast reaction. Social platforms are designed for immediacy. When you see a viral video saying “Buy this stock before the breakout,” there’s emotional urgency. That’s intentional. Social media algorithms reward engagement, not accuracy. As a result, users are trained to act quickly, sometimes impulsively.

Second, information is now framed socially rather than institutionally. Traditional investing advice came from vetted sources. Now, it often comes from charismatic personalities who may have no credentials—but do have high follower counts. Trust is built not on certification, but relatability.

Third, decision-making has become gamified. Many platforms use visual rewards (like confetti or green arrows) to reinforce trading activity. Apps like Robinhood, Webull, and Public have been criticized for turning investing into something more like playing Candy Crush than managing long-term wealth.

And finally, confirmation bias is amplified. On YouTube, TikTok, and Reddit, users tend to follow creators who share their views. That creates echo chambers where hype is reinforced, not questioned. In these spaces, skepticism can feel like betrayal—and that’s dangerous for financial decisions.

Age Still Matters

Although these behavioral changes impact investors across the board, younger investors are the most influenced.

Gen Z, which includes people aged 12 to 27 in 2024, and younger Millennials, now in their late 20s to mid-30s are digital natives. Both cohorts grew up in an online-first world, which has shaped how they consume information, build trust, and make decisions—including about money. They grew up trusting peer reviews, Reddit threads, and YouTube tutorials more than traditional authorities. It’s natural that they extend that same logic to money. When financial literacy is scarce, the next best thing seems to be a well-edited TikTok.

Older investors, like Gen X, now in their mid-40s to late 50s and Baby Boomers, now in their 60s to late 70s, tend to rely more on traditional methods—advisors, bank recommendations, or financial publications. But the lines are blurring. A growing number of Gen X and even Boomer investors are joining Facebook groups about investing, watching YouTube explainers, and dabbling in crypto. Still, age correlates strongly with risk tolerance and decision-making style: younger investors are more likely to chase high-growth assets, while older ones prioritize capital preservation.

Interestingly, the Charles Schwab 2022 Modern Wealth Survey found that 15% of investors under 35 have made trades based on social media content, compared to just 4% of those over 55. This doesn’t mean older investors aren’t influenced—but their triggers tend to be slower and less hype-driven.

Is This Change Good or Bad?

The democratization of investing is, in many ways, a triumph. Millions of people who were once excluded from markets now have access to tools, platforms, and communities that empower them. Financial education is more engaging than ever. And peer-driven spaces can reduce the intimidation factor that once came with investing.

But the shift also introduces real dangers. Emotional decision-making, misinformation, and herd behavior can lead to massive losses. Many social-first investors lack a clear understanding of risk, diversification, or tax consequences.

As platforms continue to blur the lines between entertainment and financial advice, it’s critical for investors—especially younger ones—to develop internal filters. Who is giving this advice? What are their incentives? Is this entertainment or strategy? That level of discernment has never been more important.

The bottom line is: the challenge isn’t tuning out social media. It’s learning how to use it without being used by it.