Yahoo Finance

Vivian Tu, known on the web as Your Rich BFF, has grown millions of followers since creating her first TikTok on January 1st, 2021. Vivian's mission to make personal finance accessible to non-experts and marginalized communities. Joining me now onset, we've got New York Times bestselling author and founder and CEO of Your Rich BFF, in the flesh, Vivian Tu. Vivian, great to have you here with us in studio.

Thank you for having me.

Absolutely. Let's start with your career on Wall Street. I mean, what was it like and what pushed you to change your path here?

Yeah, you know, I think like so many young people, I wanted to come to New York, pursue something that was exciting and sexy, and I also wanted to make a lot of money. And so I started my career on Wall Street. Um, after a couple years, I wanted to make the pivot and do all of those things, but also wear ripped jeans to work. So I pivoted into tech and media. Um, and when I got there, all of my new friends wanted me to explain finance to them. And I was able to do so through, hey, this is how you rebalance your 401k. This is the health insurance plan that may make most sense for you. But I put my very first Tik Tok video up on January 1st and it went viral, 3 million views, and by the end of the week, I had a hundred thousand followers.

That's one heck of a new year's resolution that paid dividends very quickly.

That's right.

I mean, what advice do you have for people looking to make career changes and pivots just as you have?

Do it scared. You know, I think a piece of criticism that I hear all the time is like, oh, I don't want to go back to law school because it's going to take three years. I don't want to try a new career because it's going to take me two years to get good at it and I'll be behind. Well, two years, that time is going to pass anyway. Would you rather still be in a dead-end job that you don't like or have gained the skills that you really care about and have a career that you love? Just do it scared.

All right, so let's get to the financial advice here for our viewers. I mean, what is your top piece of financial advice that you like to convey to either the followers on social media or just those who are trying to make a difference in how they are investing even?

Yeah, I would say it's critically important that you don't attempt to cherry pick the perfect stock or the perfect investment. As someone who has worked on the street, we would get phone calls pretty regularly of hedge funds being like, hey, we made a couple bad calls, like we're blowing up, like we got to unwind all of our trades. And if funds like that that have very literally billions of dollars of technology and resources at their fingertips can't seem to get it right year after year, what makes you think you can? So I always say just invest in a diversified portfolio that is risk-adjusted and makes sense for your age and your financial situation and buy and hold. Hold it for the long term and that's the easiest way to invest.

What about savings? I mean, on one side, you've got investing, and then on the other side, hopefully you take some profits over time, you figure out how to put that into a good savings account and let that accumulate as well here. So what are your savings tips that you're telling people right now?

Yeah. I think folks are saving, but they're not doing it correctly. They are putting their money into a traditional savings account at a bank, you know, a brick and mortar on the corner. And unfortunately, many of those are offering, you know, APY earnings of interest every single year anywhere between 0.01% to 0.07%, which is nothing. You get pennies if that. However, there are high yield savings accounts out there right now, specifically online banks that don't have those overhead costs that are, you know, willing to let you earn more interest to acquire you as a customer from a brick and mortar. And they're, you know, letting you earn anywhere between 4 and 5% in interest every single year on your money. And that is meaningfully better. And why would you want to earn less when you can earn more?

Your name is Rich BFF. I mean, tell us, how, how can someone think about instituting little strategies, perhaps in the margins of their time, to begin in order to make sure that they can create either more streams of income, or let's just be frank, just get rich?

Yeah. To that exact point of like, you know, having time on the margins, we're all busy, right? And I think I've acknowledged that you must invest to get rich. It's you can't save your way to rich anymore. But people are like, okay, well, when it comes to investing, I got to pick the account, I got to, you know, fund it with the cash, I got to then pick the investment. And it's a long process and people get scared, and they get paralysis by analysis. They're like, what's the perfect thing? What do I do? Just get a robo advisor. You don't have time for all that. So with a robo advisor, all you have to do is find one that suits your needs, you take a quick money quiz about how much you earn, how much you have, how old you are, what your life looks like, all these details about you. In the same way that Spotify can put together a playlist that makes sense based on your listening history, a robo advisor can take your financial information and then spit out a diversified portfolio that makes sense for you. And it all happens within 45 minutes and you're invested.

You know, let's get personal here. We, we understand that you recently went on your honeymoon. Congratulations on getting married. Talk to me about budgeting for a wedding and a big vacation like a honeymoon.

Yeah. Thank you.

Yeah.

I would say making sure that you understand what you value is really, really important. Uh, you know, a good friend of mine, Paula Pant has said that you can afford anything, just not everything. And it's critically important to know that. So maybe you want to stay at that five-star resort, maybe you're going to have to fly economy. Maybe you want to fly first class. Does that mean once you get there, you have to kind of piece together the trip versus having one that's fully planned out by a travel guide for you? But see what you value and spend your money that way. And when it comes to planning a wedding, it's still very similar. What makes the most sense to you? Do you want to spend on entertainment, or do you want to spend on food? Do you want to spend on flowers, or do you want to spend on attire? But pick what matters to you and spend there.

Vivian, great to have you here in studio with us on Yahoo Finance. Vivian Tu, founder and CEO of Your Rich BFF.

Thank you so much for having me.

Absolutely.