How social media influencers shape our perception of wealth and debt 

Tolu Frimpong explains how social media influencers shape our perception of wealth and debt

In today’s digital world, social media influencers have become a powerful presence on our perceptions of financial success and our approach to debt.

Central to this influence are social media influencers—individuals with large followings who effectively serve as modern-day advertisers, guiding us on where to spend our hard-earned money. 

The shift to influencers marketing 

Traditional advertising methods such as TV commercials and print ads are being increasingly overshadowed by influencer marketing. Brands are now channelling more of their budgets into partnerships with social media influencers, who can reach and engage specific audiences more effectively. 

According to Statista, global spending on influencer marketing is expected to reach £20.6 billion in 2024, up from £12.6 billion in 2022.

In contrast, TV advertising spending in the UK fell by 4.2% in 2021, while digital advertising, including influencer marketing, grew by 14.5%. Influencers often generate 11 times higher return on investment (ROI) than traditional digital marketing, making them a more attractive option for brands. 

The danger of the luxury lifestyle illusion 

While influencers can be a source of inspiration, they often present a lifestyle that seems effortlessly luxurious.

However, this portrayal can be misleading. Many influencers receive gifts from brands or rent luxury items from platforms like By Rotation and My Wardrobe HQ, making their lifestyle appear more attainable than it really is. 

For the average person, replicating this influencer lifestyle can lead to significant financial strain. Your favourite influencer might showcase a £1,000 designer handbag as a casual accessory, but it’s important to remember that this item may have been gifted or borrowed, not purchased outright. 

The trap of buy now, pay later 

The rise of Buy Now, Pay Later (BNPL) services has made it even easier to fall into the trap of trying to keep up with influencer trends. BNPL schemes allow consumers to split payments into smaller instalments, making luxury items seem more affordable.

However, being able to afford the monthly payment is not the same as being able to afford the item itself. 

Research by Credit Karma found that 42% of BNPL users in the UK have missed at least one payment, with 31% experiencing a negative impact on their credit score as a result.

Additionally, Which? reported that 25% of BNPL users admitted to spending more than they originally planned because the service was available. This convenience can lead to debt accumulation, as consumers may overextend themselves financially. 

The social pressure to keep up 

Social media platforms often amplify peer pressure, encouraging users to acquire material possessions to fit in with their peers or favourite influencers. This pressure can drive individuals to take on debt in an attempt to match the lifestyles they see online, even if it means living beyond their means. 

It’s important to recognise that appearances can be deceiving. Just because someone appears to be doing well online doesn’t mean they are financially stable. The concept of “wealth signalling”—where individuals display signs of wealth without the underlying financial stability—is widespread on social media.

As the saying goes, “All that glitters is not gold.” It’s crucial not to measure your own success using someone else’s ruler. 

The reality behind influencer earnings 

Despite the luxurious lifestyles many influencers portray, their earnings may not match the image they project. According to Influencer Marketing Hub, micro-influencers (with 10,000 to 50,000 followers) earn an average of £110 per post, while mid-tier influencers (50,000 to 500,000 followers) earn around £550 per post.

Although these earnings can add up, they may not be sufficient to sustain the high-end lifestyles these influencers showcase, leading some to rely on debt or alternative income sources. 

In the age of social media, it’s easy to be drawn into the allure of influencer-driven lifestyles. However, it’s important to approach these portrayals with a critical eye. What you see online is often a curated version of reality, and trying to keep up with influencers can lead to financial strain and debt.

Instead, focus on your own financial well-being and make decisions that are sustainable for your circumstances. By doing so, you can avoid the pitfalls of social media-driven consumerism and build a more secure financial future. 

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