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Regulated finance needs to build trust with Gen Z

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1 year ago

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Parents want schools to step up in teaching kids financial literacy

Misinformation and lack of trust in traditional institutions runs rampant in our society.

The regulated financial sector is no different, particularly among young people. Roughly 38% of Gen Zers get financial information from YouTube, and 33% from TikTok, according to a recent Schwab survey.

As a former regulator and author of kids’ books about money, I am truly horrified by the toxic advice they are getting from these unqualified “finfluencers” — advice which, if followed, could cause lasting damage to their financial futures.

Most troubling are finfluencers who encourage young people to borrow. A central theme is that “chumps” earn money by working hard and that rich people make money with debt. They supposedly get rich by borrowing large sums and investing the cash in assets they expect to increase in value or produce income which can cover their loans and also net a tidy profit.

Of course, the finfluencers can be a little vague about how the average person can find these wondrous investments that will pay off their debt for them. Volatile, risky investments — tech stocks, crypto, precious metals, commercial real estate — are commonly mentioned.

‘The road to quick ruin’ for inexperienced investors

Contrary to their assertions, these finfluencers are not peddling anything new or revelatory. It’s simply borrowing to speculate.

For centuries, that strategy has been pursued by inexperienced investors as the path to quick riches, when in reality, it’s the road to quick ruin. There is always “smart money” on the other side of their transactions, ready to take advantage of them. For young people just starting out, with limited incomes and tight budgets, it’s the last thing they should be doing with their precious cash.

More from Your Money:

Here’s a look at more stories on how to manage, grow and protect your money for the years ahead.

Debt glorification is not the only bad advice being peddled on the internet.

You can find finfluencers advising against diversified, low fee stock funds in favor of active trading (without disclosing research consistently showing active trading’s inferior returns). Or ones that discourage individual retirement accounts and 401(k) plans as savings vehicles in favor of real estate or business startups (without mentioning lost tax benefits as well as the heavy costs and expertise needed to manage real estate or high failure rates among young companies).

Some encourage making minimum payments on credit cards to free up money for speculative investments (without mentioning the hefty interest costs of carrying credit card balances which compound daily).

Why are so many young people turning to these unqualified social media personalities for help in managing their money instead of regulated and trained finance professionals?

One reason: the finfluencers make their advice entertaining. It may be wrong, but it’s short and punchy. Materials provided by regulated financial service providers can sometimes be dry and technical.

Where to get trustworthy money advice

Xavier Lorenzo | Moment | Getty Images

They may be boring, but regulated institutions are still the best resource for young people to get basic, free information.

FDIC-insured banks can explain to them how to open checking and savings accounts and avoid unnecessary fees. Any major brokerage firm can walk through how to set up a retirement saving account. It’s part of their function to explain their products and services, and they have regulators overseeing how they do it.

In addition, regulators themselves offer educational resources directly to the public. For young adults, one of the most widely used is Money Smart, offered by the Federal Deposit Insurance Corporation — an agency I once proudly chaired.

There are also many excellent regulated and certified financial planners. However, most young people will not have the budget to pay for financial advice. 

They don’t have to if they just keep it simple: set a budget, stick to it, save regularly, and start investing for retirement early in a low-fee, well-diversified stock index fund. They should minimize their use of financial products and services. The more accounts and credit cards they use, the harder it will be to keep track of their money.

Above all, they should ignore unqualified “finfluencers.” 

Check their credentials. Question their motives. Most are probably trying to build ad revenue or sell financial products. In the case of celebrities, find out who’s paying them (because most likely, someone is).

Regulated finance needs to reclaim its status as a more trustworthy source for advice. The best way to do that is, well, provide good advice. Every time a young adult is burnt by surprise bank fees, seduced into over borrowing by a misleading credit card offer, or told to put their retirement savings into a high fee, underperforming fund, they lose trust.

I know regulation and oversight are out of favor these days. But we need a way to keep out the bad actors, and practices to protect young people new to the financial world. It’s important to their financial futures and the future of the industry as well.

Sheila Bair is former Chair of the FDIC, author of the Money Tales book series, and the upcoming “How Not to Lose $1 Million” for teens. She is a member of CNBC’s Global Financial Wellness Advisory Board.

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$20,000 Caution Bond Requirement for US Visa Applications imposed on 50 Countries

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6 days ago

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August 8, 2026

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The United States Department of State has officially implemented a revised visa policy introducing a mandatory posting requirement for caution payments of up to $20,000 on select foreign travel applications. Under the updated regulatory framework, consular officials are authorized to require temporary nonimmigrant visa applicants from targeted foreign countries to post a refundable financial bond of $20,000 as a condition for visa issuance. The policy mechanism is designed to address diplomatic concerns regarding high overstay rates among temporary visitor, business, and educational visa categories.

The caution bond pilot program applies selectively to foreign nationals from designated countries whose diplomatic entities record historical visa overstay rates exceeding established federal thresholds. Under administrative guidelines published by the State Department, the full financial deposit is posted directly to a dedicated federal escrow account prior to final visa issuance. The entire caution payment is automatically refunded to the applicant upon verified proof of timely departure from the United States in strict compliance with the authorized duration of stay. Conversely, failure to depart within the legal timeframe results in full forfeiture of the posted financial bond to the United States government.

Diplomatic representatives and travel policy experts have expressed varying perspectives regarding the operational implementation of the caution bond system. Administration officials emphasize that the measure serves as an effective, market-based incentive to enforce international travel compliance and preserve domestic immigration security standards. However, international trade organizations and foreign diplomatic missions have raised concerns regarding the financial burden imposed on legitimate business travelers, foreign students, and commercial partners from developing nations.

The United States finalized the rule to make the temporary visa bond program permanent, taking effect on August 3, 2026. The updated permanent regulation replaces the prior 12-month pilot, eliminates the lowest $5,000 tier, and raises the maximum required bond amount to $20,000 for specific B-1/B-2 business and tourist visa applicants.

Here is the list of the 50 countries on the list as o August 3, 2026

African Nations (31 Countries)

  • Algeria
  • Angola
  • Benin
  • Botswana
  • Burundi
  • Cabo Verde (Cape Verde)
  • Central African Republic
  • Côte d’Ivoire (Ivory Coast)
  • Djibouti
  • Ethiopia
  • Gabon
  • The Gambia
  • Ghana
  • Guinea
  • Guinea-Bissau
  • Lesotho
  • Malawi
  • Mauritania
  • Mauritius
  • Mozambique
  • Namibia
  • Nigeria
  • São Tomé and Príncipe
  • Senegal
  • Seychelles
  • Tanzania
  • Togo
  • Tunisia
  • Uganda
  • Zambia
  • Zimbabwe

Asian & Eastern European Nations (11 Countries)

  • Bangladesh
  • Bhutan
  • Cambodia
  • Georgia
  • Kyrgyzstan
  • Mongolia
  • Nepal
  • Papua New Guinea
  • Tajikistan
  • Turkmenistan
  • Uzbekistan

Caribbean & Latin American Nations (5 Countries)

  • Antigua and Barbuda
  • Cuba
  • Dominica
  • Grenada
  • Venezuela

Oceanian Nations (3 Countries)

  • Fiji
  • Tonga
  • Vanuatu

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Next-Generation Retirement Planning: Managing Longevity Risk and Variable Income Streams

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1 week ago

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August 7, 2026

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Retirement planning strategies are evolving in 2026 to address increased life expectancies, shifting dynamic market conditions, and the transition away from traditional defined-benefit pensions. Individual investors and financial advisors are abandoning rigid retirement models in favor of flexible, multi-asset strategies designed to mitigate longevity risk and preserve purchasing power over multi-decade retirement horizons.

Mitigating Longevity Risk with Dynamic Asset Allocation
As average life expectancies extend past eighty-five years, one of the primary financial risks facing retirees is outliving their accumulated wealth. Traditional fixed income allocations—such as the standard 60/40 equity-to-bond portfolio—are being reevaluated to ensure portfolios generate sufficient capital growth alongside reliable income.

Financial planners recommend maintaining a meaningful equity allocation throughout retirement to offset long-term inflation erosion. High-dividend equity funds, global real estate investment trusts (REITs), and inflation-indexed Treasuries are combined to create diversified portfolios that deliver both growth and income stability.

The Transition to Dynamic Withdrawal Strategies
The classic “4% safe withdrawal rule” is increasingly replaced by dynamic withdrawal strategies that adapt annually based on market performance. Under a dynamic withdrawal framework, retirees adjust their annual distribution rates within pre-set caps and floors:
– Market Upside: During strong market returns, retirees can increase discretionary spending or fund family legacy gifts.
– Market Downturns: During market pullbacks, spending distributions are temporarily reduced to prevent sequence-of-returns risk and preserve core investment principal.

Guaranteed Lifetime Income Options and Deferred Annuities
To establish a guaranteed baseline for essential living expenses, individuals are incorporating modern fixed-indexed and deferred longevity annuities into their broader retirement architectures. Modern annuity structures offer competitive return caps, transparent fee schedules, and inflation-adjustment options.

By funding essential expenses—such as housing, healthcare, and insurance—with guaranteed income streams from Social Security, pensions, and annuities, retirees can manage discretionary investment portfolios with greater flexibility and lower emotional stress during market volatility.

Actionable Steps for Future Retirees
1. Calculate Baseline Retirement Expenses: Determine fixed living costs and map guaranteed income sources to cover essential expenditures.
2. Adopt Flexible Withdrawal Rules: Implement dynamic spending rules to protect investment principal against market downturns.
3. Incorporate Inflation-Protected Assets: Maintain exposure to dividend-growing equities and inflation-indexed bonds to safeguard long-term purchasing power.

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Building Generational Wealth: Family Governance, Estate Tax Optimization, and Asset Protection

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2 weeks ago

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August 1, 2026

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As the largest intergenerational transfer of wealth in history accelerates, high-net-worth families, entrepreneurs, and individual investors are placing heightened emphasis on comprehensive estate planning, family governance, and asset protection. Preserving capital across generations requires a balanced approach combining tax-efficient legal structures with open family communication and financial literacy education.

Optimizing Estate Tax Exemptions and Trust Structures
With potential modifications to federal estate tax exemption thresholds on the horizon, proactive estate planning is essential for high-net-worth households. Estate planning attorneys and wealth advisors are establishing multi-generational trust structures to transfer wealth efficiently while minimizing estate and gift tax exposure.

Popular structural strategies include:
– Irrevocable Life Insurance Trusts (ILITs): Utilizing life insurance proceeds to provide liquidity for estate tax obligations without expanding the taxable estate.
– Grantor Retained Annuity Trusts (GRATs): Transferring rapidly appreciating assets to beneficiaries with minimal gift tax consequences.
– Dynasty Trusts: Preserving wealth across multiple generations while providing long-term asset protection from creditor claims and legal liabilities.

Establishing Family Governance and Financial Education
Legal and financial structures alone cannot guarantee long-term wealth preservation without effective family governance. Financial advisors report that a significant percentage of multi-generational wealth dissipation stems from lack of communication and inadequate financial preparation among heir generations.

Families are establishing formal family governance frameworks, including periodic family meetings, written mission statements, and structured philanthropic foundations. Involving younger family members in charitable grant-making and investment discussions fosters financial stewardship and prepares heirs to manage family assets responsibly.

Digital Asset Custody and Legacy Planning
In today’s modern economy, estate planning must extend beyond physical real estate and traditional brokerage accounts to encompass digital assets. Comprehensive estate plans now include detailed inventories and legal access protocols for corporate domain names, intellectual property, digital media rights, and cryptocurrency holdings.

Fiduciaries and estate executors should be provided with secure, encrypted access mechanisms and clear legal authority to manage and transfer digital holdings in accordance with the owner’s estate directions.

Practical Steps for Legacy Planning
1. Review and Update Estate Documents: Ensure wills, revocable trusts, and power-of-attorney designations accurately reflect current family structures.
2. Establish Structured Trusts: Utilize irrevocable trusts to protect assets from creditors and minimize future estate tax liabilities.
3. Create a Digital Estate Inventory: Document access protocols and legal permissions for all online accounts, intellectual property, and digital assets.

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