Vivian Tu says investors carrying credit card debt need to stop and pay it off first. The math says she's right

Moneywise and Yahoo Finance LLC may earn commission or revenue through links in the content below.

Vivian Tu has built a massive online following telling people how to grow their money. But she has a message for some would-be investors: Stop investing, at least for now, if you carry a specific kind of debt.

The former Wall Street trader and content creator behind the multimedia company, "Your Rich BFF," says you should jump on high-interest credit card debt before thinking about putting money into the stock market.

Jeff Bezos backs a platform that lets anyone invest in rental homes for as little as $100 — 6 ways to build wealth like a landlord without actually being one

JPMorgan sees gold hitting $5,000/oz by Q4 — and savvy investors are protecting their wealth with a tax-advantaged Gold IRA. Get your free guide from Priority Gold

The tax breaks in Trump's 'big beautiful bill' expire after 2028. Here are 4 moves to make before the window closes

During a recent episode of her Net Worth and Chill podcast, Tu answered a written question by a listener about how they can balance investing with paying down credit cards and student loans (1).

"I am a little alarmed because it sounds like you're already starting to invest while still having credit card debt," Tu said. "You should not be investing. You still need to pay off that credit card debt."

In the same episode, Tu said that "the best day to start investing was yesterday, but the second best day is today."

Still, this doesn't apply to those carrying credit card debt, which can often have interest rates topping 20%. On average, the stock market grows 10% each year (2). Chasing stock-market returns while a high-interest balance keeps growing in the background leaves you further behind.

Credit-card interest is incredibly expensive and your investments have a pretty high hurdle to clear just to keep up.

"Credit card debt, unfortunately, is one of the scariest and fastest-growing debts because it's anywhere between 20% to 30% APR every year," Tu said.

Federal Reserve data shows the average interest rate on credit-card accounts assessed interest was 20.94% in May 2026 (3). Compare that with the benchmark S&P 500 index, which is only up 13% since the start of the year (4) as of market close on Aug. 14. And unlike the interest piling up on your credit-card balance, future stock-market returns aren't guaranteed.

If you're paying roughly 21% to carry credit-card debt while hoping your investments earn enough to outrun it, the math is working against you. Not paying off that balance likely eliminates all gains from investing in the market.

Tu puts it this way, "You will not invest and make more than you would save by paying off your credit card debt."

This isn't just advice from a TikTok-famous money expert like Tu. The Securities and Exchange Commission makes essentially the same point. "No investment strategy pays off as well as, or with less risk than, eliminating high interest debt (5)," the agency says.

FINRA advises people who are eager to start investing to get the financial basics under control first (6). That includes paying down high-interest debt and building an emergency fund that covers three to six months of expenses so an unexpected bill doesn't send you straight back to using your credit card.

Read More: Millionaires under 43 hold only 25% of their wealth in stocks. Here's where their money is actually going

If you're carrying a balance on a high-interest credit card, you're far from alone. Americans collectively owed $1.263 trillion on their credit cards as of the second quarter of 2026, according to the Federal Reserve Bank of New York (10).

The average American carried $6,715 in credit card debt as of December 2025, according to TransUnion (11). And for cardholders carrying a balance, the average interest rate reached 22.15% in the second quarter of 2026 (12).

That's why aggressively tackling high-interest debt can be an important first step toward getting your finances back on track. Every month you carry a balance, a sizable portion of your payment can go toward interest rather than actually reducing what you owe.

If you have balances spread across several cards, consolidating them into a personal loan with a lower interest rate could potentially reduce your interest costs while giving you one fixed monthly payment to manage.

A platform like Credible can make it easier to compare personal loan offers in one place.

You can comparison-shop for the lowest interest rates through Credible's online marketplace with just a few clicks.

You can find personal loans starting at 5.96% APR. Credible also offers a best rate guarantee — and if you close with a better rate than you prequalify for on the platform, you'll get a $200 gift card.

In less than three minutes, you'll see all the lenders willing to help pay off your credit cards or other debts with a single personal loan.

If you owe a substantial amount, you may also want to see if you qualify for a debt relief program to help clear a substantial portion of your debt.

With Freedom Debt Relief, you can speak with a certified debt relief consultant for free, who can show you how much you can save by partnering with them.

If you're eligible, they can negotiate settlements with your creditors until all of your enrolled debt is resolved.

Once that expensive debt is under control, you can start turning your attention toward the next piece of the puzzle — making sure your everyday spending is working in your favor.

You don't need to be completely debt-free before you can start building wealth, experts say.

Tu, for example, draws the line at high-interest credit-card debt. Lower-interest debt, including some student loans, are okay to carry while investing. Her rule of thumb is if your student loans carry rates above 7%, you should prioritize paying them down. Otherwise, you could potentially keep making payments while putting some money into investments.

Juggling lower-rate debt can make the decision of whether to prioritize repayment more complicated. Throwing every extra dollar at a relatively inexpensive loan means that money isn't going toward other goals, whether that's building emergency savings or investing for retirement.

One way to do both is to take advantage of your 401(k) plan through your employer. The SEC notes that participating in a company retirement plan can be worthwhile when an employer matches some or all of your contributions, which essentially adds free money from your employer to your retirement savings (7).

Also note that some forms of debt, like a mortgage (8) or student loans (9), carry interest that you can potentially deduct on your tax returns. This adds a few more dollars to your pocket to either invest or knock down balances you owe.

Paying down high-interest debt can give your finances some much-needed breathing room. But if you want that progress to stick, it helps to understand exactly where your money is going each month.

Tu recommends the 50-30-20 budgeting approach — roughly 50% of your income goes toward needs, 30% toward wants and 20% toward savings, investing and debt repayment (13).

Start by going through your regular expenses and looking for costs you could trim without sacrificing your lifestyle. Maybe that means eating out fewer times each week, cutting back on entertainment or finally canceling the subscriptions you barely use. Redirecting even a few hundred dollars a month toward debt payments or savings can add up over time.

Building a budget and tracking where your money is going at all times is now easier than ever with budgeting platforms like Monarch Money.

Monarch Money puts all your finances under one roof, from your banking statements to your investments. Once you link your accounts — including investments and real estate — you will be able to view every transaction through one clean, searchable list.

The platform can also help you forecast your spending beyond just one month.

Monarch Money also offers a seven-day free trial, so you can take a look around and see if it's right for you. Even better, you can get 50% off your subscription for the first year when you sign up using the code WISE50.

After tackling expensive debt and creating some breathing room in your budget, you can start shifting your focus from paying off yesterday's expenses to building tomorrow's wealth.

That doesn't necessarily mean waiting until every last dollar of debt is gone. Depending on your interest rates, financial goals and employer benefits, it may make sense to put some money toward investing while continuing to chip away at lower-cost debt.

The key is consistency. You don't need a huge amount of money to get started and small contributions can become meaningful when you give them enough time to compound.

For instance, investing $20 each week for 30 years can help you save over $179,000, assuming a 10% annual compound rate (14).

Apps like Acorns allow users to invest spare change from everyday purchases automatically — helping them steadily build wealth without having to think about every market move.

All you have to do is link your cards and Acorns will round up each purchase to the nearest dollar, investing the difference — your spare change — into a diversified portfolio of ETFs managed by experts at leading investment firms like Vanguard and BlackRock. Over a lifetime, a little bit of consistency can go a long way.

With Acorns, you can invest in an S&P 500 ETF built and managed by experts with as little as $5 — and, if you sign up today and set up a recurring investment, Acorns will add a $20 bonus to help you begin your investment journey.

- With files from Jessica Wong.

A single line on your car insurance policy could be inflating your premium by up to 30% — here's what to change

Dave Ramsey warns nearly 50% of Americans are making 1 big Social Security mistake. Here's what it is and 3 simple steps to fix it ASAP

Robert Kiyosaki says China is 'dumping' the US as America piles on debt. Fortify your riches with 4 key assets

Here are the 7 top habits of 'quietly wealthy' Americans. How many do you follow?

Join 250,000+ readers and get Moneywise's best stories and exclusive interviews first — clear insights curated and delivered weekly. Subscribe now.

We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.

YouTube (1); SoFi (2); Federal Reserve (3); Yahoo Finance (4); U.S. Securities and Exchange Commission (5); FINRA (6); U.S. Securities and Exchange Commission (7); TurboTax (8); H&R Block (9); Federal Reserve Bank of New York (10); TransUnion (11); LendingTree (12); Today (13); Acorns (14)

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.