Should I pay off credit card debt or contribute to my 401k?

Credit card interest rates are generally higher than the returns you will earn in your 401k account, so it generally makes sense to pay down credit cards first. However, if your company offers a match, that match might be equivalent to a rate that is higher than the interest on your credit card debt. If so, a smart approach might be: 1) Save enough in your 401k to capture the full match; 2) Then pay down your credit card debts as fast as possible; 3) As soon as you’ve paid down your credit card debts, increase your 401k savings to the amount that achieves your long-term goals (use the WealthStep advice engine to help you learn how much to save each month).