Facebook Users Take More Financial Risk [STUDY]

Facebook users who invest or gamble just after going through their news feed are more irresponsible with their money, according to new Australian research. This is a first of its kind study linking the social network with financial risk-taking, thus issuing caution for users to be careful with their finances right after posting or liking, says a report from the Herald Sun.

Facebook Users Take More Financial Risk [STUDY]

Facebook interaction acts as a “cushion”

Dr. Eugene Chan, a Sydney marketing expert at the University of Technology, said that Facebook users should not engage in online investment or gambling and must postpone their real world lotto purchases or casino visits for up to an hour after checking Facebook feeds. Eugene’s research, which was published by the Journal Computers in Human Behaviour, concludes that Facebook users see their online social circles as a “cushion” against financial loss.

With more time passing, a user faces less risk of making a reckless decision, but a habit of making reckless decisions can hit the user many times a day if he or she is a frequent Facebook user.

“It is not just being a user of Facebook that increases financial risk-taking… only those who actively browsed Facebook subsequently invested in more stock,” the expert says. Chan stated that, after checking, Facebook feeds, users can be intrigued into riskier ventures because it subconsciously highlights support from family and friends in case of any crisis.

Users must be cautious

Chan said that he is more vigilant after the conclusions of his study and wants all other users to be cautious. Internet users should not buy stocks immediately after using online social networking sites. According to Chan, government and policymakers should also pay heed to the study, thus devising rules to avoid any online financial or gaming site immediately after visiting Facebook.

Chan noted that businesses might take advantage of this and place ads to increase their click-through rates. Although this study was particularly about Facebook, Chan said a similar impact from use of LinkedIn and Twitter cannot be ruled out.

Another study revealed that Facebook profiles have increased binge drinking habits among university students. According to new research, many young users are led to believe that their friends are consuming more alcohol than they actually are.