How Fintech Is Rewiring Student Lending with Matt Palese, CEO of Earnest

0:01In today's episode, we are joined by Matt Palese, CEO of Earnest. Before stepping into his current role, Matt had spent more than a decade at Navient and Salome, giving him deep expertise in how the student loan system works from within. Matt brings a unique perspective on the current state in student lending. As defaults are poised to hit record levels in 2026, and major changes reshape federal repayment programs, he understands both the complexity borrowers face and how fintechs can simplify it. At earnest, Matt oversees operations, risk, and lending processes across the entire lending cycle, helping borrowers navigate an increasingly complicated landscape.

0:43Hope you enjoy the episode and let's dive in. Hi Matt, thank you for joining us. Very glad to have you on Wharton Fintech Podcast and appreciate you taking out time for us. Yeah, thanks for having me. Excited to be here. Absolutely. Let's begin with your journey. You've held significant roles at Navient, Salome, Wells Fargo before Earnest. What was the turning point that made you want to move to a company focused on helping borrowers refinance? And were there any pivotal moments, perhaps in your own financial life, that informed how you think about student debt? Yeah, so, you know, I've been consumer lending my entire career, so call it 28 years.

1:22You know, 17 of those years have been in student lending. And to your point, when I joined Sally Mae in 2009, really everything about the student loan landscape was changing. The FELP program at the time was ending. And what that meant was effectively all federal loans were moving to the Department of Education. and we were all at the very beginning of what we know now to be sort of a seven-year run where interest rates were effectively near zero percent and really because of the financial crisis coming off of the 28-29 Great Recession, college enrollments skyrocketed and so student loan debt grew I think at the time it was about in 2025 in particular$400 billion and that grew to about a trillion dollars by 2012.

2:15And so there was massive growth in debt. I think combined with those low interest rates, it made it pretty clear to me that there was a pretty big opportunity to help borrowers save on their student loans. You know, what's interesting, there was a parallel there that was happening in my personal life and to your point around the pivotal moment that really hit home for me. My wife and I got married in 2013. And what I think every couple did or does today, at least did at the time, is that you sat down and you review your finances together, you take a look at your debt obligations. And when we did that, that included her student loans.

2:50She was a teacher at the time. And it became very, very clear to me that she didn't have any idea at the time what she had outstanding in terms of her overall student loan debt. She didn't know what her rates were. She didn't know when the due dates were, when her grace period expired. And because she was a teacher, she didn't know whether she would qualify for public student loan forgiveness. And like, it was a complicated decision because we were thinking through how we would manage that debt after we got married. And so we were thinking through and processing the various options that she might be eligible for, such as income-driven repayment programs.

3:32And as I mentioned earlier, the student loan forgiveness component of it. And we were thinking through that process and whether we got married, whether that would, whether marriage would have an impact on her ability to qualify for those programs. Right. And so it was, it was complicated and it was very hard to really figure out how we should be thinking about that in relation to our future. And so for me, that was an extremely pivotal moment, both personally and professionally. I got to see sort of that struggle and experience that struggle firsthand with my wife. And so, you know, that's largely a reason why and how, to some extent, I show up effectively every single day and how every Aranis employee shows up every single day, really with the mindset of finding ways to extend help to the roughly 45 million people across the country that have student loan debt today.

4:24Thanks for sharing that personal story. And I understand you've been part of this, let's say two decades of expanding student debt, both inside and outside of the U.S. But I'm curious why specifically refinancing? I mean, I see the business rationale in that there's employment, there's perhaps lower risk, more predictability, but we'd love to hear from you. Yeah, so refinancing as an asset class, I think if you were to step back today and just take a look at the overall market, today it's$1.8 trillion. So the problem just continues to grow and there continues to be a huge and massive opportunity to help customers pay off their loans faster and as a result of that save a meaningful amount of money.

5:09To put that into context, we believe there's about$100 million of student loan debt today that qualifies and would benefit from refinancing. But if you look back last year, only about$10 billion actually took action or$10 billion of debt actually refinance. And so call it 10 % of that actually took advantage of the option. And so the fundamental problem here that we're trying to solve is just figuring out how we reach more people who are eligible to refinance. And so my ultimate goal is to try to get that 10 % number a lot higher. And I want to see that$1.8 trillion in overall student debt come down.

5:47You know, I think the other component here is when you zoom out a little bit and you think about, well, how do we view success? From my vantage point, it's basically helping them get out of student loan debt so they can really live the life they envision. That's our mission. It's effectively on the proverbial wall, right? But the reality is that's obviously a lot easier said than done. And how you get there looks different for everyone. I think for some people, it might mean keeping their payment the same or even increasing it slightly so they can pay off the loan significantly faster. And then for other people, it might mean reducing their monthly payment by extending their loan term.

6:22It's all circumstantial and it really depends on the customer. But the way that Earnest looks to enable that is to really offer the most flexible options in the simplest and most automated way while sort of combining that with best-in-class customer support to really help guide customers and borrowers through these complicated decisions. Understood. And I understand that being flexible for the first time borrowers or for those refinancing the zone is the key point here and is something you're absolutely focused on. I'm also curious to understand a little more about the business model here. Are you essentially making money through lending margin?

7:08What are your funding sources look like? Or perhaps are there any other revenue streams as well, like data partnerships, etc? Yeah. So at its core, I mean, we're a lending business. And so we make money on the spread between our cost of funds and the rate we offer our borrowers. That is fundamentally the model here. I think the key call out is that we don't charge fees of any kind. And so what that really means in practice is that when you apply for or take a loan out with earnest, there are literally no origination fees, no application fees, no late fees, no insufficient check fees if a check happens to get returned for some various reason or like hardship enrollment fees.

7:48And so if a borrower hits a snag or goes through a rough patch and needs help, we have programs that allow them to help them get through that stage. And there's no fees that come along with any of those programs either. The problem we are trying to solve is helping borrowers get out of student loan debt faster. Right. And so piling on fees cuts directly against solving that problem and really contradicts our overall mission at earnest. Yeah. I'm also curious to understand how big is your loan portfolio today. And I can only imagine managing a big loan portfolio at a pretty large scale is quite operationally intensive.

8:30And the infrastructure behind the scenes would be equally important. How much of that is in-house, outsourced to partners or to other service providers, perhaps? And also curious to understand And what does your tech stack and or investment look like? Yes, ever since Earnest was founded in 2013, we helped customers by refinancing over$24 billion of student loan debt. Currently, there's about$10 billion that sort of effectively sits on our balance sheet. And so if you translate that into actual customers over the life of Earnest, it's well over 400 ,000 customers and active customers today, it's more than 250 ,000 as an example.

9:19And you're right. I mean, all of our servicing today is it is complex and servicing is something that we have been extremely intentional. Almost all of our servicing today is managed internally by Earnest employees. We do augment that with a servicing partner, but they mostly handle back office processing. And nearly all customer facing interactions are handled by someone at Earnest. You know, on the tech side in particular, and as I mentioned earlier, we've been extremely intentional about how we leverage, where we leverage technology. One of the value propositions for Earnest, and this is directly from customers, is the value that they put on the human-centric servicing approach that we provide.

10:07And we want to continue with that focus even as we scale. So you can think about our technology investments today largely related to augmenting, whether that means self-serving on our web portal and making sure they have access to the right information to help them make decisions after they take out a loan. whether it's sending us an email and interacting with us through that channel or using chat to get real-time responses. We want to make it as seamless as possible. I'll give you an example of how that works in practice today. So if they want to talk to a live team member, we are typically able to get them connected with a live member of the team within 90 seconds of their request.

10:47All of this is really built around the goal of providing on-demand service that enable our customers to get the support they need using whatever channel is most convenient for them. Yeah. And speaking of technology, would you describe Ernest as effectively a fintech company in that it's different from traditional lenders who might be in the same business? Yeah, absolutely. The way I think about fintech is largely managed in the customer experience through a digitally native lens and leveraging technology in ways to make the experience better, faster, and more effective. Everything that we do today in terms of how we acquire the user, which is largely across digital channels, how we help the borrower navigate the application process online, how we help the customer get a fast and easy decision that's understandable, the data sources that we use to facilitate those decisions.

11:47All of those are using technology in a way that helps us get to that decision and the ultimate outcome for the user. There's a loan disbursement mechanism that happened as automated as well for us to actually disperse the funds directly to the servicer and to make sure those funds are dispersed and processed by the loan servicer that we're paying off quickly and automatically. And then there's the servicing component, right? And that's just optimizing for one particular channel there. That's making sure that we are optimizing for all the channels in order to serve all of our members. As you said, I can appreciate that a lot of the technology here is all consumer facing, all the way from acquiring to servicing to helping them on an ongoing basis.

12:35You also mentioned data sources for making the right decisions. I'm curious to what your underwriting model slash process looks like. I can think of data points like education, employment, credit score, things like those, but would be clear from you how your underwriting process is currently placed and how that might be let's say different from others yeah the way i would think about this is is our goal here is to is to really form a complete picture of the borrower as fast as we possibly can to give them the best possible price in the least amount of time right that's that's the north star that's the objective when you think about fico in particular which is heavily used across the lending space for a lot of different reasons um that is one critical input into helping us form that picture.

13:19But we also look at things like career trajectory, what your real free cash flow is after things like taxes and other debt obligations, what your savings behavior is, whether you have other sources of income that we should be taking into consideration. So the better we understand someone as an individual using the right data, the more accurately we can assess their risk, the more competitive the rates we can offer to our borrowers and the higher chances and the higher the likelihood of them actually saving over the long term. I was having a conversation with, I don't know if you know, Christian Widham, who's the CEO of Bloom Credit, and he was talking about the need and the importance of alternative data sources just beyond the traditional credit score.

14:07Curious to hear if that's something that you heavily incorporate in your underwriting model and how you think about that. Yeah, I actually listened to the episode. I think traditional data sources, in the way I think about them, is largely credit reporting data in particular. And that gives you a pretty clear picture of what has happened in the past. And where does that currently put you on the scale of your ability to kind of pay back? Like the other things that we look at is sort of affordability measures. What is the income? How does that translate to your disposable income after real things like taxes and debt obligations?

14:48We look at your savings behavior, as I mentioned, to understand how disciplined you are in saving and also your career, right? Because we want to look at where you're going. And I think when you start to add up all these pieces together, that helps to form the picture between using traditional data, again, which is mostly gleaned from the credit bureaus, but also other affordability measures. And both of those things are taken into consideration to ultimately form a decision on the overall risk, which allows us to make sure that we are being as competitive as possible on the pricing side. Now, zooming out for a moment and thinking about the industry as a whole, from my vantage point, I can see that fintech lending has faced headwinds in the last few years, like rising rates, defaults.

15:36I'm sure we're going to talk about that in a few minutes. Perhaps stricter regulations would be interesting to hear. Where do you see opportunity in student lending today that perhaps other might be missing that you might be working towards as a next step in Ernest's journey? Yeah, I think generally every industry experiences headwinds and lending is no different here. I do think like during periods of economic uncertainty, you have to be prudent as a lender. But I actually think fintechs are positioned better than anyone to respond and adjust given our technology, infrastructure and data capabilities.

16:14I think in terms of what others are missing, I think it's the massive gap between perception and reality in the student loan space right now. If you look at rates on federal student loans over the last two or three years, they are at historic highs. The options for broad federal loan forgiveness are off the table, at least for right now. And because of that, professionals or those with professional degrees are really reevaluating their finances. We're actually seeing that major shift right now where about 40 % of the loans that are refinancing with earnest are actually federal loans. But the reality is there's a lot of confusion out there.

16:55And as I mentioned earlier, there's only about 10 % of borrowers who we think could benefit from refinancing actually do it. And on the federal side, only a small fraction of public loan forgiveness applications are actually approved. And so we put all that together and you look at we have historically high rates. We have no path in sight, at least for right now, related to broad-based forgiveness and a lot of missed opportunity to save money. Those are some pretty big things that I think is important to make sure that we are communicating. And so, you know, where that opportunity for earnest as a company is to really take the lead in cutting through that confusion, really just with honesty and transparency.

17:38And the way borrowers can think about that is because there's a lot going on here and because we sort of emphasize and are intentional around how we think about, again, we can sort of connect them within 90 seconds to really evaluate whether refinancing actually aligns with their current situation or if just staying with the government makes more sense for them, which in a lot of cases actually does. But you should understand the options and tradeoffs so you can have an informed decision to make. We're going to circle back on the rising default rates and regulations in a bit. And I want to shift gears and talk about the persona of, let's say, one of your borrowers.

18:15I'm curious, how does carrying student debt and perhaps massive amount of student debt actually shape someone's ability to build wealth over the next, whatever, 10, 20, 30 years? From all different perspectives, home ownership, retirement planning, perhaps having entrepreneurial desires, so on and so forth? Yeah, it's a great question. I mean, first, I would say it's important to remember that student loans in general are an investment, right? Borrowers who graduate end up realizing significantly higher earnings over their lifetime compared to someone with like just a high school diploma, as an example.

18:55So while it is debt, it's also an investment that leads to much better outcomes for the students overall. And so I think that's important to just remember as we think about this. You know, with all of that said, the burden it creates, to your point, especially for the people who are just out of school, is very real. And we conducted a few surveys and we have some data points that show that. And one example of that is one in four borrowers that we surveyed said that their debt delayed a major life milestone. And in addition to about 60 % that finances have caused tension in their relationships.

19:33And so, and when you're carrying that monthly burden, it does have an impact on your ability to buy a home and your ability to potentially start a business if that's what you want to do. Or if you want to start saving for retirement because you want to get a head start on that. And when that cashflow is tied up, that sort of prohibits your ability to do that. And so if you are eligible and it ends up being the right move for your situation, I think the long-term benefit of taking action now and potentially refinancing if it's right for you is quite sizable. Yeah, just along those lines, for let's say an average customer of yours, what exactly are they trying to achieve through this refinancing beyond just getting a lower interest rate or a longer repayment timeline?

20:18Are there ancillary factors such as any major financial event they might be anticipating, home ownership, et cetera, any career transitions they might be going through or any other financial planning they may have in mind as well. Is all of that effectively baked into the process and are your solutions built around that from a borrower's perspective? Yeah, I think it's all circumstantial. For some borrowers, it's really about just creating some breathing room, right? given where they are. And that may mean a lower monthly payment. So they aren't choosing between only paying down debt versus trying to pay down debt and build an emergency fund, for example.

21:07I think for others, it's about speed, right? They want to get out of debt faster. They want to pay less overall. And they're willing to pay a little more to do that just to put it behind them. And I think for an increasing number of people, it's about a specific milestone, right? That's on the horizon. And so, you know, maybe their goal is to buy a home. Maybe it's to start a family. And this is sort of in the background impacting their ability to achieve those milestones. I think what's pretty interesting here is that the goals, and this kind of ties back to what I mentioned earlier, I think the goals here aren't always about the numbers.

21:51You know, the reality is like that causes a lot of stress, right? And getting rid of it gives people peace of mind. And so, you know, there's your financial health that's on paper. But then it's how you actually feel when you have to make these decisions about your career or your relationships. And I think both of those things matter. It's to numbers and how you feel. And so we talked about this a little bit at the beginning or a couple of questions prior to this. And that's really the reason why flexibility at Earnest is so central to everything that we do. I think to give you a little bit of an example about that flexibility is like today we offer about 180 different configurations or repayment term options.

22:47because we realize that a borrower who wants to pay off their loans in like seven years and four months may have a much different goal than someone who needs like maximum breathing room for payment relief right now that may want to choose a term that's 14 years and four months because that exact payment fits their current situation much better and can enable them to achieve the milestone that they have on the horizon. So like, you know, I think our job here is just to meet them where they are and to build around where they are actually trying to go and what they're trying to accomplish. if someone does refinance with you do they typically refinance once and are just done with that relationship once a loan is repaid or do you see refinancings occurring in let's say tranches over the years perhaps a second refinancing after a couple of years after things have improved for a borrower i'm just curious how you think about the lifetime value of your customers and is there potential for any kind of cross-selling there or is that not essentially aligned with the mission?

23:57Yeah, I would say this. We have customers that come back numerous times to refinance over and over again because their situation has changed or rates today are lower than where they were and they could benefit even more. And I think that's one of the benefits and a strong value proposition for customers is that there's no fees. It's free to do. It's very quick, simple, and convenient. And you can do it as many times as you want. So there's no prohibition on how many times you can actually do it. I think that's an extremely important component here. This is not a set and forget strategy, if you will, for customers.

24:31It's an evolution that like as marketing conditions change and rates change, there could be continued value and opportunities to save over time. But I think to your point, when I think about the refinancing product from a business perspective, it is highly transactional, right? And I think we've always known that. But the way I would look at that is is we're helping someone handle student debt. And that process is really just the beginning of a relationship, not the end of one. If you think about kind of where we've been over the last decade, it's been north of 400 ,000 barbers that we helped get control of their student loan debt.

25:10And I think what we've really learned throughout that process is that their financial needs don't stop once their student loan debt is sorted out. They're navigating other life milestones loans, unexpected expenses often come up. And many times the same borrowers are dealing with variable rate credit card debt. And I think to put that one in perspective a little more, there's about$1.2 trillion of U.S. household debt that's currently sitting in credit cards alone. And the average interest rate on that credit card debt is hovering around 21%. Because that debt is also typically variable, that financial burden can shift on people pretty fast.

25:48And so that's exactly the reason why we expanded into personal loans, right? We saw a massive opportunity to take the same approach that worked for us in student lending and give people a much more predictable fixed rate option to help them also pay down that credit card debt. I also want to circle back to the regulations we were discussing earlier. We all read about the termination of SAVE, but for the benefit of our listeners, could you walk us through what's happening with SAVE right now? Why is this moment important? And how does this affect the borrowers? And perhaps how does this change the calculus for someone who's looking for refinancing?

26:26Yeah, great question. A lot to unpack here. To take a step back, the official end of save, to your point, I think, is creating a lot of new questions and frankly is a real transition period for millions of borrowers who I think sort built their financial plans around that program. That timeline is obviously a lot more clear now, and July 1st is when borrowers will have 90 days to move off of the SAVE program and enroll in a different federal plan. And for a lot of people, that switch will likely mean adjusting to a differently monthly payment or a longer repayment timeline. And from my perspective, I think that transition is just another evolution that I think really changes the math for people considering refinancing in particular.

27:22And while many borrowers understandably stayed in the federal system over the last several years to see how things will sort of settle and shake out, That landscape is changing. And when you couple that with where federal interest rates are, in particular over the last three academic years, especially for graduate students in particular, they're up around 8%. So running the numbers now, given the clarity, makes a lot of sense. And so for, again, certain borrower segments, whether you have a graduate or a professional degree who might not likely qualify or is more unlikely to qualify for federal subsidies anyway, seeing if a private lender like Ernest can offer a lower fixed rate is a much more practical step to take today than it was a few years ago.

28:16I think the other thing I'll say, and for the benefit of your listeners, is the role at EARNESS. And so what that might mean and what that might look like for borrowers is staying in the federal system, right, and sticking with federal loans. That could absolutely be the right move. But for others, this is a good moment to see if refinancing can give them some more predictability and a more cost-effective path forward. And so we're just here to help them map that out. Yeah. And backtracking a little bit, for those who may not be familiar with what SAVE exactly is, could you just very briefly explain what the SAVE program is about as well?

28:56Yeah. So SAVE is a federal program that effectively allows borrowers the ability to increase their monthly cash flow by minimizing the amount of money they need to make towards their federal student loans. In a lot of cases, it's nothing or zero. And then over a certain period of time, that loan becomes eligible for a potential forgiveness scenario. And so those are sort of the high level kind of components that are being factored into the to the save program. So the flexibility and the convenience that it provided to customers is quite substantial. And so back to my earlier point where the removal and the change of this program and how customers need to start thinking about the transition is extremely important.

29:47Because, again, there's a couple of decisions that are going to change the dynamics from potentially paying close to nothing to having to pay something. I think, again, given the dynamic and the shift, given where we are, thinking about that in advance and figuring out if there's an alternative option for you to navigate to help sort of ease that transition is incredibly important. Yeah. And I think the flip side of the discussion is also that we do expect default rates to rise. We briefly spoke about this before. I read that 2026 is going to hit the record levels of default. In your view, how is that changing the borrower's stress level right now?

30:27And is that having a knock-on effect on the refinancing behavior? Yeah, so I think, you know, what we're actually seeing in the data is that past due balances that are 90 plus days delinquent is actually normalizing closer to pre-pandemic levels, right around 10%. To your point, we did see a massive spike when credit bureau reporting first resumed. But based on the last quarterly refresh of data, things are stabilizing now and we're in a much better position overall and more consistent with, again, what we saw pre-pandemic. You know, with all of that said, that doesn't mean that there isn't real borrower stress out there.

31:12It just gives you kind of the right context in terms of where we are. I think what those numbers really tell us is that the sort of multi-year payment pause created sort of what I refer to as like a budget illusion, if you will. And so what I mean by that is millions of people didn't have to make student loan payments for years, right, which made it feel like they had more disposable income than they actually did. And so when payments turned back on, it was really a massive shock to the system because households suddenly had to find room for a bill that they didn't have to worry about for many years or they didn't budget for for many years.

31:53And so, you know, when it comes down to how kind of the environment that we're currently in today intersects with refinancing, I think you have to look at the reality of the people we serve or the customers we serve. I think refinancing requires you to have a stable income and a strong credit profile. But even for borrowers who meet that criteria and look great on paper today, often or sometimes encounter changing circumstances that may impact their ability to pay in the future. Right. And we're always thinking about that. We're always contemplating sort of what that might look like. And more importantly, we're always thinking through how we can assist those borrowers through those periods.

32:36That's why those hardship protections really matter so much. And so, you know, to put that in perspective, at Earnest, we have things like skip a payment or temporarily interest only or temporary rate reduction programs. For those that, if they hit a snag or experience a financial hardship, we can offer those types of programs to minimize and help with that transition for them, whatever it may be, whether it's dealing with an unexpected medical bill, whether it's dealing with a job transition. We have kind of real structural options to help them get back on track. I think these are the types of things that aren't talked about often with customers that I think is extremely important, especially as you think about the decision whether refinancing is right for you, is to often make sure that things change all the time and the economic environment is very uncertain and it's very difficult to predict the future.

33:43But the one thing that we want to make sure is known is that if you do encounter an unfortunate circumstance that requires you, that requires some assistance along the way to help you get back on your feet, we have options, we have programs to help you. My overall assessment is that there's a lot that's changing for the borrowers, regulations and otherwise, and a lot of change yet to come. I can only imagine that means there are more opportunities for Ernest to innovate to the extent you can share if there's anything that you're building or anything that you're excited about that's yet to come for Ernest.

34:20Yeah, no, absolutely. I love this question and I'm excited about a lot of different things. The one thing I would say here is, when you look back on Ernest's history, we spent over a decade building, you know, I would say something that is incredibly hard to build in this industry. It's a brand that borrowers actually trust. It's a product that consistently delivers. We have a phenomenal team that really cares about customer outcomes. And so for me, the foundation is there. And really, the way I think about the next 12 to 24 months is building on top of that. And so on the product side, what that means is the expansion into personal loans.

35:03that is still very much in the early stages, but we have a ton of runway ahead of us. We're serving people who are navigating high interest debt or who might be sort of contemplating a major financial milestone. And the exact same approach that made us successful in student lending also applies to personal loans. And so, you know, we're also in a unique moment where, you know, there's just millions of borrowers that are actively reevaluating their options. And they're doing that without a clear picture or a full picture. And so, as I mentioned earlier, our focus is to simply keep building features that really solve each customer's pain point, which could be unique and different and making sure that we can be flexible in that way.

35:50And so, you know, one of the things that we've just done recently was launched a new feature called the job offer refinancing. And so what it does is allow graduate borrowers to refinance using a signed job offer letter before they even graduate. And so the benefit there is that they can lock in a better and hopefully a lower rate much earlier without losing their grace period. And so ultimately what that means is that you can start saving sooner, right, because that interest during your grace period continues to accrue. But if you can accrue less interest and you have a job offer lined up, then earnest will take that into consideration and allow you to refinance earlier versus making you wait until you actually graduate and go into repayment.

36:37And so, you know, at the end of the day, we just want the company to show up for the people when it matters. I think that means giving them clear, honest answers and again, real human support. And that's what we're going to keep building towards. The job offer feature is quite interesting. I can see how that can give someone almost like six months to an ear of headway in terms of the savings they can make. And finally, just a word of advice from you. What would you say Wharton or other graduate students, many of whom are in their early careers or still paying loans, actually should do right now?

37:10Is there any one thing that matters from a financial planning or a wealth management perspective? Yeah, I think that goes back to where, you know, why do we think people choose not to refinance today or why do we think the 10 % is so low? And part of the problem being just inertia and inaction. I think the advice I would give is to develop a plan, right? The sooner you act, the quicker you can actually start to realize the full return on your investment, which in this case is your education. And so acting fast and quick is the most important thing. I think Like, second, be strategic about your choices.

37:54Not every loan is created equal, so it doesn't have to be an all or nothing decision. Sometimes it only makes sense to refinance a portion of your loans while leaving the rest alone, right? That sometimes can complicate the decision, but if the objective is to get out of debt faster or reduce your monthly payment, and as a borrower, you have multiple loans that were taken out over multiple academic years, those loans likely have different interest rates, right? And so it may not necessarily make sense to refinance all of those loans, but some of those loans, it might make more sense. And so just be strategic when you do act, because I do think there's options that are out there where you don't have to kind of make this an all or nothing decision.

38:40I think the last thing I'll say is, be thoughtful about what you do with your savings, right? And so if the objective is to pay less over the life of your loan and so therefore you have more excess cash flow, think about how you should start allocating that free cash flow that you've freed up effectively into a potential brokerage account or a savings account that can compound over time and ultimately build into much more meaningful wealth. You know, I think the thing that I'm incredibly thankful for in my own life is growing up is really being disciplined very early on about spending less than I make and thinking long term and really valuing the benefits of compounding.

39:33And so it didn't feel like I was making a lot of progress over the years when I was just taking the$100 or$200 or$300, whatever it may be, and stashing it in a brokerage or savings account. But you fast forward 10, 20, 30 years later, you really start to see the value of compounding. And so the faster you can think about, one, acting, and then two, being strategic about how you make those decisions, and then thoughtful about how you take advantage of those excess savings, I think could be extremely impactful longer term. Yeah, that's great advice. On the final note, what's the best way for someone to reach out to you?

40:18Is it LinkedIn or otherwise? Yeah, so I'm in LinkedIn. You can find me on LinkedIn. it's Matt Palizzi, P-A-L-E-S-E, or you can shoot me an email. It's matt, M-A-T-T dot Palizzi, P-A-L-E-S-E at earnest.com. All right, great. Thank you so much, Matt. This has been an incredibly insightful conversation and really appreciate you spending time with us today. Yeah, thank you so much. Thanks for having me. I really appreciate it. Thanks for tuning in to the Watton Fintech podcast. Be sure to subscribe and follow us on social media at Watton Fintech for more interviews, articles and insights big thanks to our guests and until next time this is your host webhub