Sharing the wealth

It used to be taboo to talk about money at social gatherings. But, in an age where people boast about their relationships and post embarrassing photos on online, it was only a matter of time before social-networking websites began cropping up to offer financial advice.

"Banks and credit card companies are coming up with innovations to help you get into more debt," said Shawn Ward, cofounder of Geezeo.com, a Framingham social, personal-finance website that was launched this summer. "People look to online communities for motivation, intelligence, to see where they are compared to their peers -- and a lot of traditional finance has missed the boat in terms of the community aspect."

The new networks all focus on different aspects of finance, but the underlying idea is the same: The tools that people use to connect with their peers and share information on websites like Facebook, Del.icio.us, or Wikipedia can help people save money or make smarter purchases.

Social-investment sites take the sheen off "expert," allowing people to compare their investments or trade advice and opinions. Social-lending companies let people appeal to other people, rather than their banks, when they need a loan. And finan cial-advice sites that employ social-networking tools act like Weight Watchers for money: People choose goals, such as buying an iPhone or paying off a credit card, then move toward them while others with the same goals trade encouragement and strategies.

"I know a lot about the mistakes people make at a young age, and I think it's a great concept," said Cary Carbonaro, president of Family Financial, a traditional financial planning firm based in New York and Florida. "If I'm in debt, I can go talk to other people in debt or ask someone who is my peer and not embarrass myself."

But there are obvious questions, ranging from privacy and security risks to the dubious benefits of leveraging the financial "expertise" of the masses. The wisdom of the crowd may be a fine way to discover the most amusing YouTube video, but Wikipedia has been vilified for inaccuracies, and the online world hardly has a reputation as a trustworthy source. Start-ups need to gain the trust of users, assuring them that the software is hacker-proof and that their detailed financial information won't end up in the hands of marketers.

Nevertheless, Internet entrepreneurs are betting that financial advice from a disinterested crowd with various levels of expertise may be as good or better than professionals who work on commission or work for a particular bank.

"There's no question if you're a consumer, you are so outgunned by the marketers lined up against you," said Jason Knight, chief executive of Wesabe.com. "Social finance is a way for consumers to find out if there's real value where they're spending money. . . . It's absolutely critical in rebalancing the power between consumers and marketers."

The new companies range from spendthrift to speculative, and are predicted to carve out a respectable niche. Social finance should have 2 million users by the end of next year, and 16 million within 10 years, according to Online Banking Report, an industry newsletter.

Geezeo.com and Wesabe.com start out like online versions of Quicken or Microsoft Money. People link or upload bank accounts and credit cards to online accounts with privacy and security systems.

The website takes that information and breaks it down by categories, using tags that are assigned or generated by other users. Others may have tagged Dunkin' Donuts as "coffee," for instance, so the website will decipher the bank's language and suggest categories.

Then, the sites can break down the spending into "tag clouds," a cloud of text where the biggest expenses -- such as "rent" or "groceries" -- are noted in larger type. Geezeo, which is still in beta, features groups such as "Shopaholics" or "Boston on a Budget."

On Wesabe, clicking a transaction tells a user how much other people spent at a store, let's them know where fans of the store tend to spend money, and exchange relevant tips linked to transactions -- such as how to avoid shipping costs at Amazon.com or an analysis of how much a cup of coffee really costs.

David Knight, 28, of Greer, S.C., spent a lot of time online looking for ways to squeeze money from his budget when his son was born and signed up for Wesabe in February.

"I like the social aspect; it saves me time . . . and it ties in everyone else's ideas," he said.

At the other end of the spectrum, a slew of sites try to help people invest.

Covestor.com, launched this summer, tracks its members' investment records, allowing people to judge their portfolio's performance against the crowd. Zecco.com is a Web brokerage with blog and social-sharing features that allow people to share tips and trades. Wikinvest.com, launched this summer by a Harvard graduate, bills itself as a Wikipedia for investments, promising to be a constantly updated resource that reflects more than just a single expert's opinion of a certain company.

For those who want to make an investment in other people, new social-lending companies, such as Prosper, Zopa, and LendingClub, which launched on Facebook, allow people to lend to and borrow from their peers.

Finally, for the true exhibitionist, a new network of personal finance bloggers has sprouted up, keeping profiles on NetWorthIQ, which offers people a public forum in which to chronicle the ups and downs of their assets.

The woman behind one NetWorth profile said she started blogging about her finances because she felt alone.

"Being able to read and see the details of how others were managing (or not) their money was something I found very interesting and powerful," BostonGal, who insists on remaining anonymous because she posts so much detailed financial information online, wrote in an e-mail. "For me, it was finally answering questions such as, 'How can people afford to buy that?' or 'Am I the only one who struggles to save?' "

Carolyn Y. Johnson can be reached at cjohnson@globe.com.