Fake news creates confusion; fake financial news can cost you money.
In a survey of 1,019 adults by the Harris Poll for the American Institute of CPAs, 77% said they feel it’s important to act fast to make financial decisions when breaking financial news become available. But that can hurt your financial health.
“Knee-jerk reactions are never helpful when it comes to your finance — whether the news is fake or legitimate — as you’ll be inclined to act on your emotional response without considering the potential long-term impact,” says Marc Roche, co-founder of Annuities HQ in Toronto.
Ronald Beasley, CEO of StockSpotify.com cautions, “Everyone has their own agenda.”
Fake financial news is muddling information. More than 60% of those polled said fakes news has made it more difficult to make critical financial decisions, particularly regarding healthcare, investing in the stock market, retirement and buying or selling a home.
Fake financial news isn’t going away. Here’s how to work around it.
- Hit pause
“Do your own fact-checking before making any financial decision, purchase or any action influenced by an external source, or get a financial adviser to do it for you,” says Jeremy Goldman, CEO of the Firebrand Group in Manhattan.
- Use reliable sources
Company news releases, for example, may have their own risks, but they might help you recognize when a news site is wrong.
- Recognize red flags
The American Institute of CPAs says to be suspicious of headlines making outrageous claims and articles with incorrect grammar and multiple typos. Inadequate evidence or heavy use of unnamed experts is another clue something may not be legit.
Similarly, watch for website spoofing — impersonation of legitimate websites and with content that looks like it came from that site.