Online communities and networking sites are exploding and quickly becoming part of the daily routine for millions, who search for old friends, share information and reach out to others with similar interests.

According to a July 2007 comScore report, the Facebook online community experienced 270 percent growth in unique visitors between June 2006 and 2007.

Amid the rising popularity of networking sites such as Facebook, MySpace and LinkedIn, it was only a matter of time before social media sites were launched for financial communities.

What is social media? Social media focuses on building and cultivating an online community for people who share common interests.

Many sites cater to specific content areas and allow members to share facts, opinions, insights and experiences.

Members can engage in a meaningful discussion and gain new perspectives from one another.

These sites provide a variety of ways for members to interact, including chat rooms, messaging, videos, blogs and discussion forums.

How can social networking sites help investors?

With dozens of information sources – newspaper columnists, television analysts, work colleagues – all offering you financial tips and advice, it can be difficult to know whom to trust.

The idea behind using social networking sites for gathering investment and other financial information is that the collective community is better than any one or two individual opinions.

Online financial sites that are being developed today not only provide access to financial data, news, and tools, but also offer the opportunity to be part of an interactive community – to find investors like yourself, gather opinions, and contribute thoughts and ideas.

By sharing research and past experiences, users help each other make better financial decisions – whether it is stock purchasing decisions, finding a financial advisor, getting out of debt, or saving for retirement.

This type of platform allows users from all over the world to collaborate with like-minded investors.

What type of information is available?

In addition to trading tools, news, and market data, the unique value social media forums bring is the ability to connect with other investors and gain insight on your own financial situation.

It's the users themselves who post, review, comment and rate/evaluate much of the information on the site – in turn, building a rich financial community.

Within the online community, many financial networking sites allow users to write their own blog or review other investors' blogs to catch the latest buzz or gain new investment strategies.

Some sites even offer a search capability allowing users to seek out other community members based on a variety of criteria, including: trading strategies and styles, research styles, years of experience, amount invested, age, or specific stocks traded.

What are the drawbacks of visiting these sites? There are obvious questions you will want to ask yourself before diving into the world of social media.

The comprehensive wisdom of the masses may be a great way to gather information, but there is no way to be sure of the credentials and experience of the other members.

Just as you would use caution diagnosing your medical condition from information listed on a website, you need to tread carefully when using the opinions of others to make decisions that may have a major effect on your financial situation.

Additionally, if you choose to reveal personal information and share account activity within an online community, you will need to ensure that privacy and security measures are trustworthy.

How can I learn more? People look to online communities not only to gather information, but also to seek motivation and validation for their decisions.

If you have questions about sites that combine social networking with personal finance or need advice on your individual situation, consider consulting a financial planner.

An advisor can help you review the information, tools and resources you find online and work with you to develop a comprehensive financial plan to meet your goals.

This column is provided by Tim Dameron, a senior financial advisor with Ameriprise Financial Services Inc. in Rocky Mount.