Hi there, good morning, good afternoon, good evening, wherever you are joining us from, I want to welcome you to this incredible show. My name is Abhijit Bhaduri where I talk to fabulous people in this show and I myself, a person who has been involved in talent management throughout my career. I work with people and organizations on their talent strategy, on their upskilling strategy and essentially how to make people and organizations become successful. On this show, I talk about incredible career journeys and you will realize that everyone's career journey is so completely unique. Just ask someone, how did you land up here? Is this what you plan to do? And most of the times the answer is, I just had a broad idea and I don't know how I landed up here. But I want to start by talking about this person. We will come to his skills in a minute because it's very hard to describe. What does he really do because he does so many different things? To begin with, he's a great photographer. Look at this. It's a beautiful photograph. He loves traveling. He cooks Japanese food so he's also a cook. This of course is one of my favorite photographs that he has clicked. This is gorgeous. And then I realized that he likes to take selfies with wildlife. And because this is another cute photograph, look at the lion is staring at you and he's also known for doing other assisted headstands. So I asked him, what does that mean? And of course, I think we should all hear that answer together. What is this obsession with doing headstands? It just has to take you a second because you realize here is a person who's actually turned one entire industry upside down because he is called the OG of gaming. My friend Vishal Gondal, welcome to this show. Thank you so much for being here. Thank you. Thank you for inviting me on your show, Abhijeet. Always excited talking to you and especially on the topic of your book, Terrier 3.0, where you are demystifying the future of work, the future of life. And hopefully we'll have an amazing conversation. I want to start by looking at this whole thing of doing headstands because I remember in one of the conferences, and this is actually for the benefit of everyone here, I was at a conference and so was Vishal. We bumped into each other at the tea stall and Vishal just went around and said, okay, I'm going to do a headstand. Who wants to take a bet? So people started putting money that he couldn't do it. And Vishal, of course, did that headstand. I had that on my camera, but somewhere I have to locate it. What is this obsession with headstands? When did you first start doing it? I think it's not the obsession with headstands. It's the obsession of doing something which people believe you can't inherently do. You know, there is this mold everybody has been put into that you have to be an NBA to be able to do business. You have to be from IIT to be able to build a technology company, or you have to be from X to do Y. There are these more people are always put into. And in my case, I'm a college dropout. I never really studied. If you look at me, I mean, I'm not that physically fit that people will think I can do that. I don't have a yoga body as they put it. So I think people always used to say that, hey, I know you can run, you can do marathons and all that, but can you do a headstand? So I was challenged a few times that I can't do it. And I have this belief that you can do anything. It's your first.  And then everything else, your body, everything else will will eventually take care of it. And that's what happened when I started learning headstands. The most important thing, you know, what I learned in doing the headstand, what is the most important quality? It's coming forward, the fear of falling. It is not anything else, not about having the physique or the muscle. We all have that more or less. But the fear of falling is what stops you from doing these things. Any kind of, you know, inverted, inverted exercise. And to learn that, you need to fall a million times. And that's what I'm really good at. You know, I'm really good at failing and failing and failing. Maybe try doing a headstand and fail a hundred times till I could comfortably do it. And I became so good at falling that I don't even now need a surface to do headstands. I can do it on a road. Normally people have to put, you know, mats and pillows and they kind of have a soft surface. But because my whole training was done from falling again and again, I don't have that fear at all. So that was really the secret behind doing something like this. And that's what I tell people that, you know, that just because somebody tells you you can't do it, don't tell yourself you can't do it. I want to go back to this whole thing of failing.  Talk to me about that time when you started doing science in the ninth grade or tenth grade, whatever, you know, and then you kind of say that, oh, now I'm locked into this for the rest of my life. What was it like when you decided to drop out of college? Before I, you know, go to college, actually I started making money when I was in school. I started my business when I was still in school, when I was seven or eight grade.  I remember that I used to open every electronics in the house. I've opened the radio, I've opened the television set, anything in the house which used, and then I was not able to put it together. That's another problem. But I was this little kid who had to tinker with everything, open it up and plan, put this together. And early on, on one of my birthdays, he gifted me a computer, which was literally among the first process. It used the Z80 processor. This is pre-intel days. It was called the Sinclair ZX Spectrum. He got that machine as a gift in the house, and that was it. I was hooked to computers or that device, that device connected to your TV set, by the way. And it used an audio cassette to store data. So my first experience with computers was not even the floppy drive. It was pre-the floppy drive, which is audio cassette, where you were storing and loading data. All I had was a manual of this. There was no internet, nothing. So I was just reading these manuals in and out and figuring out how to code these things, how to play games. Of course, the first thing I did is play games on that, and then I started teaching myself programming languages. So it used something called GWBasic. This is even before MSBasic or MS-DOS games. I'm talking about that era of computing, which is the early 1990s. That thinkering, I eventually bought my first PC, which had this two floppy drives, that time the five and a quarter inch floppy drive. And that's when I got the MS-DOS manual from Microsoft, the original manual. And that's when I also got to learn assembly language, because you could only code using assembly. And this is all neat thinkering. I mean, there was nothing like this. And while all that was happening, in school, I was a national level volleyball player. So I was very fit and athletic. I used to spend a lot of my time in the field. I was playing volleyball, choose my game. Interestingly, while this started happening, sometime I think in the late 1993, 94, I actually set up a computer institute. And this is because I started training people at my house how to code. Because a lot of my friends came and said they wanted to learn how to do this. That led to me starting a computer training academy. And that academy was called FAC, Uchura Academy of Computer Technology, like very fancy name. And we were training people, I had two computers, and we were training people how to program in DOS. And then there were programs like Lotus 1, 2, 3, Wordstar, this is that era of computing, really the early days. And I was the school kid who was the trainer, you know, people coming in and kind of joining. And this led to me getting contacted by a bank in our locality who had, who gave me their first project. They wanted to create a mailing list of all the account holder. And just to remember, I charge them 70,000 rupees. And to some 5,000 accounts, I actually did data entry myself over several nights. But you know, for a kid who was maybe in eighth grade, it was not bad. And at that point of time, 70,000 rupees is like a very, very big amount. So that was literally my first income on my own in my eighth grade. So you made 70,000 rupees when you were in the eighth grade? In the eighth grade, yeah. And what did you spend it on? I bought gifts for my mom and my uncle and my, so of course this was spent as gifts for people because this was literally my kind of first income. And I didn't really have the concept of money too. I was very young that time. I must be what, 13, 14 years old. So it was very, very early. What was that transition into college when you were sort of here? You were building these games and running your own business. I have to tell you a very interesting story before that. So in my school, when my principal found out that I have started this institute, he connected me to her son, who said that he is looking for a career opportunity. What can you do? So I hired my principal son as a manager of that center. So I'm in the school and my principal son is employed by me. This is literally what happened. And of course, I was the king in school because I used to be called by the principal. How is my son doing?  I was a son performing at the job because he was the manager of the center and I was the faculty. And then I had a couple of other teachers over there. And then I was this volleyball player with, so I was like the star in the school because I hardly attended classes. So my goal was just to score enough to pass. So that was my entire goal in school, that how do I pass school and score my 10th? And luckily, because I had just about average grades, but because I was a national level volleyball player, I could get into any college I want because there is this special thing called sports quota. You know, before a lot of colleges wanted sports people there. And for me, you know, what the choice was simple. I said, listen, I'm not going to do science because it requires attendance. So the college was chosen based on attendance requiring not education or what it is.  Then farmers, I said, if I don't get to attendance, then I will consider it. And arts was anyway considered. So we only had three options, you know, science, arts and commerce. So I ended up choosing commerce, not because again of the college, et cetera. I mean, that was good. I got into a college called Podar College, R.A. Podar. But I got into the sports quota. And one of the things was because I'm the sportsman, you know, I have to go for training and practice, I really didn't have to attend classes. So that was really the criteria of me joining the particular section of college. Here you are sort of in college. And what was going on in your mind about gaming and building that entire proposition? I was obsessed with one thing that, you know, everybody used to talk about movies, movies, movies. And I used to tell people that, you know, what gaming is going to be bigger than the movie industry. And my entire pitch and that entire obsession was that, you know, everywhere else, gaming is bigger. You know, this was a time where, you know, you used to talk about gaming industry coming up and movie industry and gaming industry used to be constantly compared with each other. And of course, if you know today the statistics, gaming far exceeds the movie and entertainment business. In fact, it is even bigger in certain countries like China and all that. Gaming is the dominant industry. So this is the, again, I'm talking about early 2000. This is pre the mobile phone. Mobile phones only came in 2001. So I'm talking pre mobile phone. The betting in my entire pitch was that gaming is going to be the biggest industry of entertainment. And in India, that is the same thing going to happen. And people never believed me. And, you know, the same example of my headstand.  It is never going to happen.  These were the things which people used to say. And I know a lot of people still believe that.  So going back to my college days, in college I only spent my time having fun. So I was active, of course, playing volleyball. I was very active with the extracurricular activities in college, but I hardly attended classes myself. Again, the college gave me a great environment. And I do believe that a lot of my learning actually came from sports because I was the captain of the team. I was part of a sports team. And my extracurricular activities in college, because that's where you learn how to convince other people, how to gel with other people. And in sports is where you learn how to fail. And then even after failing next day, you have to convince your team that, hey, we will do it again. And normally sports is one area where, even though you keep failing, you have to keep the morale high. So I believe that my learning while college was okay. I didn't really learn much there. What I really learned was from sports, my background as a sportsman, and by getting involved in a lot of college activities where I could help people organize in need, that's really where a lot of my learning happened in college. How did you end up building this company called India Gaming? So that's again a very interesting story. So I remember 1998, you know, my computer institute was running while I was still in college. And 1998 was a big turning point where the Kargil war happened in India. And I being this Josheela young man, I created a game called I Love India where you could play this game on a browser. It used a software called Macromedia Director. And it was just, so you should remember director. So I quoted that whole game in director. That game let you, basically you were on the border and you could shoot at all these intruders who were trying to cross the border. And it was kind of released.  This is, again, the internet was introduced in 1997 in India. And this is 1998, very early days of the internet. And we were featured on television. I think BBC News did a story on this game. And suddenly everybody wanted to kind of download and play this game and get excited. In fact, I remember that we even got an email from one of the terrorist organizations saying that we should put down this game and that kind of made us more excited at that point of time. So this is 1998 when this game was made. And that's when I got the idea that what people are hungry for is local content. You know, this is for the first time somebody saw a game which a normal Indian could relate to. And that's what led me to create India Games as a company with the whole idea that we will create local gaming content which is going to be around Indian themes and Indian storylines. We created a game on only where you could throw colors at people. We could be created a whole host of games around the India theme. But that's where I got my second big breakthrough. This is with a company called Pepsi. Because we all know Pepsi. I saw it there. What happened is that near my house is the Pepsi office. So I created this game where you could shoot at the Coke cans and Pepsi bottle was like a cannon. And you could shoot at the Coke cans and blast them with this Pepsi bottle. And I know that and that was the time Pepsi and Cola Wars were going on. There were these really crazy ad campaigns. And I went to the Pepsi office. And of course I didn't know anyone. So I literally in an auto rickshaw took my entire PC with me and I went to the office. This office is in Devanar. It's called the Duke's factory office. That's where the Pepsi office was. And I went there and I said, I want to meet whoever's in charge of marketing. And they were like, who is this kid here? And so, you know, so they said, okay, please wait. So I waited there for about an hour. But I was sitting with my entire computer desktop. I'd got everything to demo there. Then I finally met the marketing manager there. He came and met me. He said, what is it? And I remember his name is Benkut. He used to be the general manager of marketing. And then Benkut saw this game.  Think that this is really amazing. And he called his HR head and they said, you know, let's do something for it. And he said, you know what? We have these sales teams over here.  So the first use of that game was for HR motivation. By the HR team to be installed in the computers. And they paid me some, you know, 50, 60,000 rupees for that. But the big break came after that game was made. I met this lady. They told me there is a national marketing head coming in. I don't know who this is. Her name was Vibha Rishi. Vibha is again here. She was the first major, you know, marketing head of Pepsi who created a lot of campaigns. And then I showed this, I was made to show this game to Vibha Rishi. And she got so excited. She said, you know what? We have deals with movie theaters across the country. So why don't we install this game inside movie theaters and let consumers play this game. And as a reward, we will give them a Pepsi can. You know, that game was national campaign and Pepsi paid me five lakhs, by the way. That was my single largest billing where they installed, I think we must have done about 50 kiosks across the country and in places like Sterling Theater, Metro Theater. So every theater had the Pepsi. All the theaters were dominated by Pepsi. So they created this thing across. And for the first time, what I also did is I imported touch screens. So there was a PC and they installed a touch screen on top of it. And these were single touch screens. And this is still, I'm talking about not even 1998, 1999. And while I'm still in college, you know, this is like at that point of time, I, you know, basically started doing a lot of this business with Pepsi and other brands. And then one thing led to another. You nearly were started working with me. I worked with Pepsi then I worked with ITC. So a lot of companies started coming to me and I started using this word called Adware Gaming, which is using gaming for an advertising combined. And we created that model at that point of time from doing a few lakhs in revenue. I think by 1998, 1999, we were doing close to a crore in revenue. One, yeah. That is when I was like, listen, it's not a crore, maybe a little less than that, maybe 70 lakhs, but still I mean it was significant revenue as a company. And that's when a funny thing happened. I was approached by this company whose name sounded very, very odd to me. They told me they're a company called Price Waterhouse. I was like, I don't know who this Price Waterhouse is. And they said, no, no, we are investment bankers. But they had not heard of investment bankers. So I told them, you know, listen, I don't need any loan. I don't need anything. They said, oh, you want to meet you and all that. Then I spoke to a friend and he said, listen, these guys seem to be legitimate and they're meeting you. So why don't you meet them? I said, okay, we'll meet them. So for the first time, so my office, by the way, just to kind of give you, but I was born in Chembur. My office is in Chembur. Even now I stay in Chembur. So Chembur has this Chembur station.  Everything is crawling there. And there are these little lanes on the side. And in one of these lanes, there is like vegetable vendors. And on that building, second, third floor was our office. So for the first time, there were these three people, two people who came in full suits there. The entire market like, wait, and it's like, you know, then these two people who come to meet me, of course I'm in T-shirt and shorts and these two guys come in, they say we are from Pricewaterhouse and we saw an article about this game and we believe that you can raise venture capital. I said, listen, I don't know what venture capital is. I said, no, no, no, we believe you can raise two crores in venture capital. And two crores at that time was like, you know, to give a context that's like, roughly two million dollars, what they were talking, you know, if you 10x of that, right, two crores, I said, listen, I don't need any venture capital, I don't need any of this. So they said, no, no, no, think about it. And, you know, so I told them, what is venture capital? And they explained. So they finally told me that, think of it like a capital which you don't have to return back because the only concept of capital was a loan. So they think of it like a loan which you don't have to give back. And that's when, you know, I spoke to my dad and said, you know, this is this company who wants to give me a loan which they don't want me to return back. The great idea was, you know, if somebody is going to give you a loan which you don't have to return back, why don't we, they said, okay, so I said, okay, we'll hire you. So then they came and said, we will only be hiring me. So they need a success fees. We'll give you a success fees, what's the big deal in that? And we signed up PricewaterhouseCoopers. Wow. And then they said, we're going to create an Excel, a business plan. Again, I had no idea what a business plan is. So they asked me a few questions and then they created this Excel sheet which I know a lot of people here will find very interesting. It was one sheet which had 20 things. And when you click on one, it opened another sheet, another sheet, another sheet, another sheet. And it had all these different columns and you could change one number and everything in the sheets changed. So it was this very, and they called this a business model. They said, no, it is all these. And they told me, give me some assumptions, et cetera. And they created this business plan. I had no idea what that was. They just told me that you talk about gaming and rattles. We'll tell you these numbers you should rattle. And we will help you raise capital. I said, oh, great. So we did three meetings. You won't believe. In three meetings, before we could say yes or no, we had a commitment of three and a half crores. We wanted to work two crores. And the business was, we are creating India's first gaming destination. That time it was the portal because there was no mobile. This was basically IndiaGames.com. So it was the dot com era. So we were the games.com. So basically the thing, there needs to be a dot com for everything. I was the gaming.com, IndiaGames.com. There were these venture capitalists who were falling over each other to fund the company. And I had no idea what's happening. The only thing I knew was that this is money, which I don't have to give back. I was very clear. And by the way, all of this is while I'm still in college. So for me college was more, the reason I gave up college was because I was like more other things going on. And I was already hiring people from other places to work for me. So it didn't really make any sense. So I was able to raise that venture capital without knowing what's a business plan, without knowing what's a business model, without knowing anything. The only thing I knew was how to make games, which was the most important thing and which is why I survived because most of the other people knew what a business plan and what all that was, but they did not know how to make a product. So just to sort of look at the skill involved, what is the biggest skill if you had to now sort of distill this down and deconstruct it? What is the skill that you think worked in your favor? I think gaming I always see is an entertainment business. Most people think gaming is like software. What is the big deal? You can buy an engine and put some character and launch a game. So that is the, a lot of people try and simplify every business as saying that what's the big deal? I can get two people to build something for me. But gaming and to a large extent even today a lot of products come when you have extremely passionate people building this. So I was it for myself. All the people I hired was because they loved playing games and loved making games. So gaming is I say it's art and technology mix versus you know, you know why there's that time there was not as much tech on filmmaking and other art forms but gaming was totally combining art and tech. So you were first of all looking at people who played games, who were passionate about games and they could then convert their art into a product. That was the most important insight of this that you need to find people who are passionate about gaming. The second thing was we used to basically always look at people who we got on board as do they gel ourselves as a team? Because gaming is a very team effort. You know, there is a coder, there is a game designer, there is an artist, there is a copywriter. So you know, a lot of these teams come together to create a product. Very rarely can the programmer also create art and the artist can also do music so it has a lot of these moving elements and then there is the game design. What is there in a movie? So because the game designing process itself is very, very team oriented, it required people who can really collaborate with each other and which is why we played a lot of multiplayer games. So you know, we used to have LAN sessions in office because one of the best ways to gel and bond was to play LAN gaming that time. You know, we had Counter Strike and all these kinds of games which we were playing on our computer. So you know, we used to be spending a lot of time making games and playing games at the same time. Then there was this moment when your company India Gaming got bought over. That was much later, right? I mean, this I'm talking about 2000. We sold the company in 2012 but there was a massive journey in that 12 years which saw lots of changes. In the first phase, we literally went bankrupt because Dotcom busted. All the money we had was blown away. By the way, I hired that same Pepsi guy to become our president. Then the guy who gave me the first contract, we hired him but of course, he was too big to be in a startup. So you know, that didn't work out here to lead. But basically everything we could do wrong happened and we literally were not gonna survive. And you know, the way we survived was because we had this very fancy office in Bandra. So we actually found out that there was a lot of deposit we had given the property owner. So we gave up that office, got the deposit back and went to this little office in Chemgur and that deposit is what made us survive the next few years. And that's when I went back to my core of game development and we took a big bet. And again, that bet is what got us here and that is what I always tell people that you have to bet your company on something. And we took a bet on mobile games. He said, and this is right when mobile was introduced. The first Nokia Color 4 was coming in and we said, we are gonna make games for mobile phones.  We were the first company who created not one or two, we created a series of 12 games for Nokia devices. And what happened is Nokia launched that phone and it was a worldwide hit. And what happened is literally Nokia took us to every mobile operator in the world and said, you need games for the phones. This was basically three or four companies and they said, you now need to get a contract with us. So we sitting in India at contracts with 65 mobile operators everywhere in the world, right? From Singtel to Telefonica to Vodafone to Verizon. Name it because we were the first with those games and when people launched those phones, they wanted the game. And guess what? The model was revenue sharing and we said, okay, we need to do revenue sharing. And the best part was Nokia had already paid me the game development. So Nokia made me money to make those games. Actually, I had already made the games and had the money and then they got me these revenue shared deals. And now I started getting money from all these operators all around the world. So from literally having no money by 2004, our revenue was close to two million don't. Wow. Because suddenly these games were all getting in and that was the time we got a investor from China. They were one of the listed companies called Tom Online who came in and bought our investors who came in early at a 16X return. So they came in and the investors who had put in the early money, they got an exit of almost 16X and this is 2004. So actually I sold first partly my company in 2004. That's when the early investors got out. I got Tom Online, but I got two other very interesting investors from Silicon Valley. One was Cisco and the other was MacroMedia itself to invest which then became Adobe. MacroMedia was then bought by Google. So it was MacroMedia and then Adobe came in and then the goal was we are going to expand globally with this model. So I set up an office in Los Angeles, an office in London, an office in of course China. We had an office in Spain and the model was we are going to acquire licenses from across the world and create games. And guess what was our first major license? It was none other than Spider-Man. So we became the host company to license Spider-Man from Marvel Comics and created the Spider-Man game. How old were you then? Well, this is 2000 when Spider-Man was released in 2002, I think, sorry, 2004, 2005 around that time. So we did that game. This is the game I'm talking. So we were the first major licensing deal of Spider-Man. It was done by me on the gaming front, on mobile games. And we then acquired rights to every major Hollywood property. So whether it is Bruce Lee, Predator, there was this movie called Day After Tomorrow. Listen, 20th Century Fox, Buffy the Vampire, Slayer, all the Disney titles. So basically we were the company which any good brand owner would say take my brand and make it into a mobile game and distribute it across the world. So this is all pre-iPhone type. This is all pre-app store era. This is the era which was all dominated by the mobile operators at that point of time. Apple came in much later. So we were becoming bigger and bigger in the gaming space. And at one point of time, we had almost 63% market share in the Indian market. And that's when our third transition happened that the Chinese investors had some problems in China and they had to exit. And then I got another person on my company and our board again is a very fascinating person and he's big in the world of careers himself, which is Ronnie Scruwala. Ronnie now runs Upgrad. But before that he was running UTG, which was the biggest movie studio of India. And the idea was he wanted real gaming and he wanted movie licenses. So getting him was a very strategic bet because he would give us the movie licenses and we would make the game. So it was a great combination. And then it was even bigger. We scaled up even bigger because we had the entire backing of India's biggest studio, which was UTG. And in fact, we worked with Shah Rukh on the Ravan game. We did like gaming. We were like completely dominating the market. At one point of time, we had almost 400 people studio, possibly the biggest gaming studio in India. And finally 2012, that is the time when we sold the company to Disney. So there was a lot again, I'm still kind of going summarizing these things, but the journey had so many ups and downs and so many near misses and clashes and unbelievable recovery that like I said, that for me, I always say that I find peace in chaos. Because if there is no, if there is anything is going wrong, right means there is something's wrong. It's the other way around. And then finally we sold the company to Disney in 2012. And that would have been a couple of hundred million dollars. It was a decent number. Let's put it that way that, you know, everybody, all our key employees made a very good return. Our in, of course, our invested had a good return. And even, you know, me and my family had a decent return. And I jokingly say that I directly got a job in the world's biggest media company without ever being interviewed by anyone. So I, by the way, in a date, I have never had a formal job, never because I started the company itself from school. So I've never really been interviewed as an employee ever. Of course, I, I get interviewed by all these other people to invest in companies that's even worse, but I've never really been in a shoe of an employee.  You are one person who did that, made your millions. And then what, why do you continue working? I mean, what's the reason to work there? Because I don't think so. I ever did this for money. Even whatever I'm doing now, money is not the goal at all. Money is a byproduct which may or may not happen. If you start doing things as money as a goal, then you're already designing yourself for failure because that doesn't work. You need to have a powerful purpose on what you are doing and why you are doing it. So for me, that was never the case. The second thing was, you know, people talk about, they say enjoy the journey and not the destination. And for me, it's actually more than the journey. I say it is the companion and the people with you in the journey, which is more important. And the reason I say that is because a lot of my team members who were in India Games, most of them are CEOs of company. They are all doing so well in their own journey. And we called ourselves a India Games family. We even have a WhatsApp group there. And I think that's the best part, right? The people who were with you, I literally grew up with them. In fact, I even got married to, I found my to be wife that time in my same organization. You know, she used to be heading marketing and sales. And I have to clarify, I did not recruit her. She was recruited by somebody else. But my point is that in fact, a lot of people in India Games even found their soulmates within the organization. So India Games was one place where a lot of people came because everybody who came in was young. You know, the average age of employee was 23-24. So and a lot. In fact, even my current co-founder Sachin who was part of my Goki journey, he was in India Games and he also got married with another colleague at India Games. India Games made a lot of families where it was really created, where, you know, people met each other for the first time there. So I always say when you are enjoying the company of people, and that's when you want to do next thing with another set of people and enjoy the company and the journey and then the destination.  Again, about reaching the destination. So it's about making sure that the people you are surrounding yourself with are adding value to you and themselves and the organization. That is really the key thing. And if you think from that perspective, you will not think of retiring at all. So you sort of left India Games and then started on this journey of building Goki, which is where you are now. I was one of the early recipients of your Goki handheld device, you know? So I remember that moment. So it was incredible. And I kind of thought that that's a ridiculous idea.   It's not just, you know, doing a headstand, you know, for a sport, but that's also the way that you are looking at a whole lot of things that I think about in your career, whether it's looking at your career really like a game. And that's so amazing. You know, how do you sort of look at that? And that's what I find incredible. We'll come to the game part of it. But before that, I want to know about Goki. What is the trigger for that? And why did you go into Goki? What are you trying to build with that? You know, while I was in school, I was a national level volleyball player. But running the gaming company, all the travel and all the pizza and all the Pepsi, I jokingly say, made me a volleyball myself. I was 120 kgs, extremely obese, unhealthy, pre-diabetic. So I had all these health challenges.   So what finally I did was, this is 2010, 2011, I met a coach in my neighborhood. And he said, I don't have time. I keep traveling. So he said, okay, you have WhatsApp. I said, yes. He said, send me a photo of everything you need. And I used to wear the Fitbit that time. They had this Fitbit thing which you could put in your pocket. He said, send me a photo of how many steps you need. So I used to basically message him and share these things. And he used to tell me, do this, do that. So I basically completely remotely worked with this coach. And I then ran my first half marathon in 2012. And since then I've done 13 half marathons. I've done four ultra marathons. I even trek to Everest Base Camp. So I was able to make a change in my own lifestyle and health. And that's when I figured out the problem. The problem in health is most people believe it's an information or an access problem. When you talk to anybody, they'll say, give me some diet or give me some person or give me some coach or give me some doctor. So either you're asking for information or access to somebody who will help you solve this problem. But the real problem is it's a motivation problem. Most people know they should not be smoking or drinking too much alcohol or eating junk food, but they do it not because they don't know. It's because they lack the motivation. And the reason they lack motivation is because it's very, very boring. Becoming healthy or it's very, very hard. And this is the problem which games solve very well and that is what I'm gonna explore that. And the expertise which I have is making something fun. And people say, what is fun? People don't understand the concept of fun. You say fun is games, but how do you make being healthy fun? And to kind of put you, give you a little context of that, right? So think of the x-axis as difficulty of a task and the y-axis as your experience level.  So you are at level one and they give you a task which is level 10.  Or the other extreme happens that you are this very active person who is let's say fairly advanced and they will tell you, okay, from tomorrow, drink three glasses of water. So they give you a very, very easy task but your level and humility is much higher and you find that boring. So what fun is when you are able to give you a task which is slightly more than your capacity and when you achieve that task, you need to be given another task. So you are able to layer it, but more than the layering, then what happens is after 10 such tasks, you are given a big problem for which you have to strive harder. We call it the boss level in a game.   This entire aspect of health is completely missing because it's largely boring. You don't want to see a health app in your phone because it constantly reminds you of negativity.  It is always reminding you of something negative versus a game which is always telling you, I'll click this and you'll give you four hearts or Candy Crush is going to give you four candies. So the gaming model is a model which is always motivating you to come back. Said that what is missing and what is my capability is to connect gaming to this world of healthcare and create this unique model. In fact, I don't know if you remember, we don't even call Goki users, patients or customers. We call them players. So as a go, you are a player of the game of life and what your goal is to level up and the way you level up is by doing all these tasks which kind of give you points which we call Goki Cash and the more Goki Cash you earn, you can go and get rewards in terms of stores, et cetera. And by the way, the latest version which we are building connects it to your virtual avatar who becomes younger as you become healthier. So we are connecting it to longevity. We are creating it into a completely virtual pet game where you are your own virtual pet. Incredible. What a brilliant thought process. When you look at gaming as a sector, if somebody wanted to build gaming as part of their career journey, what are different roles that they should be thinking of? Going forward, is this going to be something big? Do you think it'll die out in the next couple of years? Is it going to boom in the next couple of years? What are some pieces of information you can share with us? First of all, gaming is no longer gaming. Gaming has what I use the word transformed into meta gaming. It's about gamification of a number of things in your daily lives. Even LinkedIn, when you log in, it shows you that your profile is x percentage over and there are many case studies of how LinkedIn use gamification to improve people to complete their profiles and things. So if you look at gaming today, it is actually now becoming a part of every major product development and service development. So while it started as as entertaining, the other very important thing is that actually it's, it's a very interesting fact for a lot of people here. Any kind of innovation happens into industries before they reach anywhere else. One is gaming and the second is porn. Porn, yeah. So these are two industries which always use the most cutting-edge technology. Why is that? Why is that? So gaming, first of all, itself is about communities, friends. So the whole social networking, how do you team up with friends? How do you do quests together? Quiet hyper collaboration. So what's, you know, platforms like Slack, we're trying to do is what gaming platforms did for the longest time. And now discord is the new place and discord was built for gamers. But today discord is becoming the new destination because gaming required that level of collaboration.  So it's almost like you're on the battlefield on walkie-talkie with your comrades while you are fighting. So that is the level of hyper collaboration required in games. And we are talking about people still not getting and replying emails in the corporate world while gamers are hyper collaborating in the hundreds to do quests in real time. So that is one big reason why gaming is so far ahead. And discord is all about immersion. And when they want you to immerse in whatever experience they are trying to give you, but at the same time, they want you to transact because people, they want you to also spend. So if you look at any kind of innovation happening in payment models, transaction models and immersion, that happened in that industry because again, that's the nature of that business itself. You know, people want that. That's the only core proposition for them. So sure, all the new things happen there. In fact, if you really see what Mark Zuckerberg is trying to do with Meta and I, I'm telling you here, a lot of people don't see what he's seeing because I come from the gaming world. What he's essentially trying to do is he's saying he already has people on his social network. He just wants to upgrade them and become like a fortnight where everybody will have a character, everybody will be walking in virtual reality. So he's basically gonna convert his social network into a giant game. That's really what he's trying to do. And that is if you see slowly he's introduced avatars, he's introduced this and within some more time, you will basically not find any major difference between what Facebook or Instagram is and then what fortnight is for example. When you think about learning something yourself, what is your method of going about doing this? You know, you sort of had an incredible journey and it was so inspirational that you've always learned what somebody has not formally taught. So in school, it is about building that little computer. There's about, you know, moving deeper into that and then teaching others, inviting others, building a company. Effectively, a company is all about teaching what you know. So that's really the whole model of an organization. There's more people do it as well as you do, you've got a great team and you've got collaboration. And yet in the world outside, we find that collaboration is such a problem in organizations that grapple with this whole thing of collaboration. They say that people don't want to work with each other. They don't give each other feedback and you know, feedback, you have to be very cautious.  You don't want to do this. And yet game is just the reverse. You're bad, you don't go past level one. You will not go to level two until you've really mastered that. But in the organizations, you know, you don't promote me in X number of months or years. I will quit. I will go somewhere. What is the beast that real world is missing that gamers can teach us? Part of being a gamer is about having this whole aspect of leveling up. So the way you fight a bigger battle is not with a weaker character. Your character cannot be at level one and be at level hundred. Versus what is happening in today's organizations is that there is a level mismatch all the time. And HR is trying to tell people that please do this course and do the learning and do this development. And nobody wants to do it because this is not coming from within. Because within they don't know what their level is. They think they have X level, but there is no real way for them to know where they are in the organization.  And then you also know what you can do to improve your level or improve your character. And that is exactly what I do in my own personal. So first of all, I believe that in today's world I can learn anything I want. I don't think so. And Elon Musk wrote about rocket science on a flight back on the book. He did not go to any college to learn about rockets and he's built SpaceX. So the bottom line is that today between YouTube, Wikipedia and Reddit and every other forum out there, there is nothing that you can't learn. What is lacking is the motivation. So everything else is an excuse. People say I can't do this. I jokingly say people again that we blame the education system. Education system is bad. This is the same education system got APJ Abdul Kalam who studied under a lamp post to become the head of DIDU and then the president of India. So don't tell anybody that the education system is bad. It is you who have not been able to take the advantage of the system. It's very, very easy to say this is bad and that is bad. I always say that especially in education and health and career development, it's about yourself. So the framework I adopt on myself is I literally say that just the way we want our PC to be upgraded, we say or our mobile phone, we want the latest iPhone, we want the latest software, we want the latest memory. If I was a product and I am let's say version 1.0, list your teachers, what can you do in three aspects? Physically, mentally and spiritually. So there's the mental aspect, the physical aspect, the mental aspect and the spiritual aspect. And the way I call it the hardware, the software and the operating system. So you have to fix these three aspects of your body and it's very easy to do things physically. You do things physically, you have to work out, eat healthy. So if you can today do five push-ups or you can walk for 500 meters, let's say that's your version one. Can your version 1.0 or 2.0 run one kilometer? So can you upgrade yourself in that department? Secondly, your brain, the way to do that is how many books are you reading? How many podcasts are you listening? How many lectures are you attending? So how are you giving knowledge? Instagram, Reels and TikTok don't count here, but what are you doing to keep your brain? And another thing which I do and I recommend everybody to try something of that sort. I use Duolingo to learn a new language. The best way to upgrade your brain is to learn a new language. And Duolingo is gaming combined with language learning. So right now I have learning Japanese on Duolingo and it's because it is the best way to keep your brain young, learn a new language. And you can pick any language, there are like a dozen languages there. And the simple way you can say is your version 1.0 did not know a single word of Japanese, but your version 2.0 has learned 100 Japanese words. And thirdly, on the spiritual side, you know what really enhances that is travel and not travel for business. Travel for a wildlife safari, go to a spiritual place, go with friends. So when you travel and get experiences, these are things which are adding to your operating system.  That is what, you know, enhances your spirituality. And then one habit which I took up and I recommend a lot of people to take up is some kind of mindfulness or meditation. And that kind of adds to your spirituality. So that's your version 2.0.  And you will see like today my version can do a headstand. Maybe your version currently can't, but that does not stop you from saying, you know what, my next version can do a headstand on a wall. So you have to have that mindset and that's what makes it fun. Don't give yourself a very difficult challenge that tomorrow I'm gonna climb Mount Everest.  So you have to challenge yourself slightly above your way and that's what gives you. So that is the framework I have adopted for myself. And I always tell people the same way that, you know, this is your time to upgrade.  I'm so inspired by what you just said. I kind of, two or three big takeaways from our conversation today. One is this whole notion of how we view careers, a legacy which has been handed over to us saying that you can only choose science, arts or humanities and commerce. You choose between them. And then you are in that lane and you'll end up wherever you return, that's what it is. I personally agree that it's an absolutely obsolete model which is what led me to write this book. I also think that this new economy is going to be a lot about, you know, we are going to live longer. So therefore health becomes an important part. How do you gamify it? And don't treat it as tomorrow I'm going to stop doing all this. How do you gamify it and become a little better, a little better, a little better and that whole process of doing it. And of course this whole thing about the skills that you build, the different ecosystems. It's interesting, curious to see what are the next big things that are going to happen in this world and how do you become a part of that.  And it's just basically falling down was not really a problem that you're dealing with. You just do it so many times and so it's not just the skill but the failing. And I kind of define that as the wobbling phase of when you try to learn cycling, you wobble for a long time. And once you give up the fear of falling, you graze your knees once you do it again. So big deal. Once you adopt that gaming mindset, you lost out in level three. You almost made it to four. You just missed it by a risk. Can you come right back and do it again? So I think that's the magic and Vishal just wish you the very, very best in your dreams because your dreams are very large and I hope you truly get a chance to solve those kind of problems that you're aiming to do. And we look forward to following your journey. How can people get in touch with you if they want to? What are ways in which we can do? I think that the best way to connect with me is on platforms like Twitter and LinkedIn. I'm quite responsive there. In fact, the worst way to send me is an email. I hardly look at it. Perfect. And what's your handle on Twitter? At the rate Vishal Gondal. And same has said on LinkedIn. Thank you very, very much. And I so appreciate your taking time to talk to us.


It's up everyone. My name is Alex. I'm one of the co-founders of MyInvestingClub.com. If you are brand new to trading or are curious about trading at all, I want to let you guys know about a free two-hour mentorship course that I put together with my mentor, Bao. It is available at MyInvestingClub.co. The link is going to be right here. This is a free webinar with limited seating every week, so please click on the link and reserve your spot before the time runs out. Also, a special bonus for all of our viewers on YouTube. So if you guys have any questions about MIC or you're curious about joining or you don't know if MIC is the right fit for you, you can now text Tosh, who is one of our head mentors and head moderators at MIC, and he'll answer any questions you have about MIC. His phone number will be in the link in the description. It'll also be right here. Thank you guys for watching and enjoy the video. Hey, what's up guys? It's Tom Dizon here. Welcome to another weekly video and I hope you guys had a great weekend this week. Today, I really want to talk about a pretty important topic as well, which is, you know, our habits, our bad habits. And here is the quote that I really like a lot. It's from Bao Twitter, like really long time ago. I can't remember when. Just said here, the first time you make a mistake and it's an accident. The second time you make, you know, it's on purpose. And the third time you make, you know, that same mistake. It's no longer a mistake, but it's a habit. And I think it's so true in many ways. If we just keep repeating the same mistakes over and over again, I mean, that's our choice, right? I mean, that's our habits, you know, in a way. And so that's why I want to talk about that today. I think that's basically the main thing, what we are struggling right now, at least is what I'm struggling right now, you know, myself.  Like I didn't focus on my process, but more like PNL. I was taken by, you know, a move since I was into big. So I'm just gonna go over that and and talk about each one for you guys to have at least an idea, you know, what you're dealing with or how you can, you know, overcome that or like, you know, solve that problem. And so let's go on to it. All right. So first, it's over-trading.  And it's like my greed kicking and right. And it was like, I was up like, I don't know, a few hundred bucks in the first 30 or 40 minutes at the opening. And when I'm done with the trade and I said to myself, man, that's not, you know, good enough, right? I need to get in something. I mean, I just need something more.  So that's, I mean, that's over-trading, right? Usually you take, you know, lesser trades. It's like, it's like you kind of trade on fly more. Like you just think whatever it moves and you just basically jump in, you know, the trade right away. And you didn't even, you know, think about the setup, you know, at a time because your head, I think it's not clear. I mean, my head is not clear when, when, usually when I'm over-trading is when I don't make enough or like I'm red on the day or like I kind of want to revenge trade. And those are, you know, the times when I'm over-trading a lot.  I mean, I mean, it's not easy, but I think, you know, there are some ways that, and you can actually can help you to reduce that. And first of all, you need to have a playbook, right? Or like I said here an edge, like you need to know what you're looking for. And if you know what you're looking for, you're not going to over-trade, right?  And if it doesn't come, you're not going to make a trade.  And I think that, you know, helps me a lot. Also is tabs. It's like trading accountability, you know, buddies. And here is an example. I have James whenever, you know, we'd done by 1030 and I'm still around and trading. He's going to slap me, or I always going to, I don't know, kill me maybe, but my house down.  Why are you still trading?  And I think it's, it's, it's really helpful to have someone like that, you know, trading beside you. And when you're not in the right mood or when you're not in like, I don't know, trading in the zone, like you're not in the zone, and you need someone to kind of snap you out of that, right?  It doesn't matter, you know, what's set up, but now is not a good time.  I think tabs is very important.  I mean, when the day is done, you over trade it, right? You done already, but then you have to look back and what you don't, you know, did wrong here. I mean, or next day, you could upload your trade and see why you traded the way you did. Because, you know, you have to kind of analyze that to see if that matches your setup or matches your strategy. If not, that's outside of the edge, right? What the heck, you still doing that?  And I think that's a good way to be able to realize what you did wrong here. And I think usually, we're not going to realize it in the moment. But on the next day, when you see those trades, you just, I mean, it happens to me and it kind of happened to me.  All right, guys, so I hope it helps today. I hope you enjoy the video and I think have a good weekend. I'll see you next time then. Peace. Thank you so much for watching our video. If you want to see more of our videos, please subscribe to our YouTube channel by clicking the button here. We do our best to post a new video every single day. If you have any questions about MIC or any general trading questions, please text Tosh using the number here. Also, stay up to date by watching some of our most recent videos right over here.


Personal Finance PowerPoint Presentation. Reverse mortgage. Get ready to get financially fit by practicing personal finance. Most of this information can be found at Investopedia Guide to Reverse Mortgages, which you can find online. Take a look at the references, the resources. Continue your research from there. This is by Amy Fontinier, updated April 4th, 2022. What is a reverse mortgage? In a word, a reverse mortgage is a loan. So typically, when we're talking about real estate, when we're talking about a home, we can't usually purchase it outright. We typically have a loan, the home being security on that loan to safeguard the lender, typically the bank or other financial institution. A home owner who is 62 or older and has considerable home equity can borrow against the value of their home and receive funds as a lump sum, fixed monthly payment or line of credit. So this is typically we're talking about retirement type of situations. Oftentimes at that point in time, people might have a significant amount of assets, meaning they've got assets over liabilities. They're looking pretty good from a net asset type of standpoint. But a lot of those assets could be tied up and non liquid because they're in the home. And obviously at that point in time, we would like to have some kind of steady income stream to be using the assets for, for what our needs during that point in time. So how could we liquidate some of the assets that are in the value of the home in the equity of the home, which is the difference between the loan value and the market value of the home. So unlike a forward mortgage, the type used to buy a home, a reverse mortgage doesn't require the homeowner to make any loan payments. Instead, the entire loan balance up to a limit becomes due and payable when the borrower dies moves out permanently or sells the home. So now instead of us basically lowering the loan balance, you can imagine, obviously when you purchase the home, the typical thing you're going to take out the loan, you're going to be paying off of the loan, lowering the loan balance as you lower the loan balance, you're increasing the equity in the home, assuming like the home stays at the same value. Let's assume that or hopefully it goes up, but if it stays at the same value, when you pay off the loan, the gap, the difference between the home value and the loan value goes up. Well, you can kind of, you can think about or imagine reversing that if the bank would allow that, right? You can say, well, now I'm going to have the loan balance, the gap between the value of the home and the loan balance decrease in a reverse type of fashion. So federal regulations require lenders to structure the transaction so that the loan amount won't exceed the home's value. So you have the same kind of considerations that you would think would want to be in play, meaning we don't want the loan value to go above the value of the home because you have the same kind of concerns from the lender side of things that you have in a normal loan. That would mean the person is not as invested in the home, more likely to kind of walk away from the home. For example, so you still want that investment in the home to be sufficient to make the lender comfortable to do the agreement. So federal regulations require lenders to structure the transaction so that the loan amount won't exceed the home's value. Even if it does, though, a drop in the home's market value, or if the borrower lives longer than expected, the borrower or borrowers of state won't be held responsible for paying the lender the difference thanks to the program's mortgage insurance. So mortgage insurance can kind of help out with that situation. You can imagine different structures on how this would be set up, this reverse mortgage would be set up, but if you're saying there's going to be a fixed amount of payments into the future, you're probably making estimates based on someone's life expectancy, right, and in some way. So now you've got to estimate and what if they live longer than that? Well, now they're going to get payments for longer than that, or you could try to set the end time frame or how many payments are going to be there, for example, but you can see the estimates that are going to be taken into account, and that's going to be the estimate made at home value in the future, and an estimated home value now, and then the life of the individual, how long are they going to be living are going to be considerations if you were to structure something in this reverse fashion, although there's a couple different options to structure it in kind of like a reverse faction. So cash in equity, reverse mortgages can provide much needed cash for seniors whose net worth is mostly tied up in their home equity. So they got, they've got assets, but they're not liquid. They're in the home, they need the assets at that point in time, they need a steady income to be living on when they're not in their working years. So the home market value minus the amount of any outstanding home at Lowence is the equity, yet these Lowence can be costly and complex as well as subject to scams. So because of the complexity involved, you know, you got to keep that into consideration because, you know, you want you want things that you can basically understand when you're doing your investments in them and they get a little complex and the different structures that could be involved here. So this article will teach you how reverse mortgages work and how to protect yourself from the pitfall so you can make an informed decision about whether such a loan might be right for you or a loved one. According to the National Reverse Mortgage Lenders Association, homeowners ages 62 and older held 10.19 trillion in home equity in the third quarter of 2021. So that's a lot of money tied up in the home equity. The number marks an all time high since measurement began in 2000, underscoring how large a source of wealth home equity is for retirement aged adults. So clearly a lot of money tied up there in retirement age, they might need to tap into some of that money since they don't have the same kind of cash flow they did during the earning years. Home equity is only usable wealth if you sell or downsize or borrow against that equity. So how can you tap into that? Well, you could take another loan against it, you could sell the home. But if you sell the home, then you'd have to move somewhere else where the homes are cheaper or downsize the home or some way to get the actual cash flow that's in the equity. That's the problem. That's where reverse mortgages come into play, especially for retirees with limited income and few other assets, but also for retirees who want to diversify their income and reduce investment risk, sequence risk and longevity risk. So in other words, if all of your money is tied up into the home at that point in time, although the home is a good asset to be invested in, it's not a diverse form of investment. So another way to diversify maybe to break that up a bit. How a reverse mortgage works with a reverse mortgage instead of the homeowner making payments to the lender, the lender makes payments to the homeowner. What? How can that be possible? Because of course, instead of paying down the loan, the loan is actually going up, which means the difference between the home value and the loan is getting smaller instead of bigger.  So the homeowner gets to choose how to receive these payments. We'll explain the choices in the next section and only pays interest on the proceeds received. The interest is rolled into the loan balance so that the homeowner doesn't pay anything upfront. The homeowner also keeps the title to the home over the loan's life. The owner's debt increases and home equity decreases. So they still have the title to the home and so on and so forth. It's not like you're, it's not like they have an equity interest in the home, the bank can't come over and tell you what color to paint your house or anything like that. But obviously, the liability is going up, reducing the equity as with a forward mortgage, the home is the collateral for a reverse mortgage. So clearly, it's the collateral if you were, if there was a problem, then the lender has the home as recourse to that. When the homeowner moves or dies, the proceeds from the home sale go to the lender to repay the reverse mortgage principle, interest, mortgage insurance and fees. So clearly, this is at the end of the life. And so you would think that at the time of death, because you're basically getting the payment from the equity of the home, that's when things get settled due to the value of the home. Any sale proceeds beyond what was borrowed to the to the homeowner is still living or the homeowner's estate, if the homeowner has died. In some cases, the heirs may choose to pay off the mortgage so that they can keep the home so you can still pay off the mortgage. But obviously, the mortgage is going to be higher because it's been increasing during that timeframe. Reverse mortgage proceeds are not taxable. Well, they might feel like income to the homeowner, the Internal Revenue Service IRS considers the money to be a loan advance. So they, which seems correct to me, it seems a correct consideration considering the loan is going up. So it's basically, you know, a loan it's not even though you're getting paychecks, money, cashflow, you're really, you know, getting part of the equity and you didn't really realize it yet, you're increasing the loan. So type of reverse mortgages. There are three types of reverse mortgages. The most common is the home equity conversion mortgage, the HECM. The HECM represents almost all the reverse mortgages that lenders offer on home values below the confirming loan limit set annually by the federal housing finance agency and is the type that you're most likely to get. So that's the type that this article will discuss. Also called a federal housing administration FHA reverse mortgage. This type of mortgage is only available through an FHA approved lender. If your home is worth more, however, you can look into a jumbo reverse mortgage. Also called a property reverse mortgage. Number one lump sum get all so this is when you take out the reverse mortgage, you can choose to receive the proceeds in one of six ways. So it gets a little bit complex in terms of how you're going to get that money. One, you might say, give it to me all, give it to me now. Give it to me. Just like I won the lottery, I want a lump sum. So number one lump sum, get all the proceeds out at once when your loan closes. This is the only option that comes with a fixed interest rate. The other five have adjustable interest rates. So you got to take that interest rate into consideration. Number two, we've got the equal monthly payments annuity. So now we're going to get the payments kind of like when you won the lottery. This isn't really winning the lottery because it's your money and the equity, but you know, you can now you're going to get the payments. I want to give it to me in payments for as long as at least one borrower lives in the home as a principal residence, the lender will make steady payments to the borrower. This is also known as a tenure plan. Number three, we got the term payments. The lender gives the borrower equal monthly payments for a set period of the borrowers choosing such as 10 years. So you can see number two takes a little bit more estimation going on because you're going to say, well, how long is that going to be going to use some actuarial tables or something, get some fancy math in there to figure out that one. Over here, you got the term limits. So you're just going to set the term for 10 years. But what if I live past 10 years? That's an issue. That's why you got to take that into consideration if it's if it's number four, line of credit money is available for the homeowner to borrow as needed. So you might say, Hey, I don't really need the cash flow per se, but I'd like it to be available to me in the event that I do need it kind of like a credit card. And so I'm on a line of credit on this thing. The homeowner only pays interest on the amounts actually borrowed from the credit line. Number five equal monthly payments plus a line of credit. So now we're doing some mixing, some maximum, some combination action. So the lender provides steady monthly payments for as long as at least one borrower occupies the home as a principal residence. If the borrower needs more money at any point, they can access the line of credit. And then number six, we got the term payments plus a line of credit. So another mixing matching kind of combo situation. The lender gives the borrower equal monthly payments for a set period of the borrowers choosing like 10 years or something. So we set the period. But if the borrower needs more money during or after that term, they can access the line of credit. It's also possible to use a reverse mortgage called a HECM for purchase to buy a different home than the one in which you currently live. So you might be using that in some form to move to another home, for example, in any case, you will typically need at least 50% equity based on your home's current value, not what you paid for it to qualify for a reverse mortgage. So clearly this would be a situation where you would expect someone had the home for quite some time and the equity has increased in part possibly from paying down the loan that they had and or the value of the home goes up. So we're talking about the value of the home. You would think at this point in time the current value of the home, which would require some appraisal process on the part of the finance or the bank or financial institution. Would you benefit from a reverse mortgage? Yes or no? I want yes or no here. That doesn't look like a yes or no. Let's see what they say. A reverse mortgage might sound a lot like a home equity loan or home equity line of credit, a HELOC, indeed similar to one of these loans, a reverse mortgage can provide a lump sum or a line of credit that you can access as needed based on how much your home you've paid off and your home's market value. But unlike a home equity loan or a HELOC, which we talked about in prior presentations, if you want to dive into that in a bit more depth, you don't need to have income or good credit to qualify and you won't make any loan payments while you occupy the home as your primary residence. A reverse mortgage is the only way to get access home equity without selling the home for seniors in situations like these. So these are the types of situations you might most likely be in the consideration of it. They don't want the responsibility of making monthly loan payments. So clearly you're not making loan payments at that point in time because they're going to be dipping into the equity of the home, the bank paying you possibly can't afford the monthly loan payments. So you can't afford the monthly loan payments anymore, but you've got substantial equity in the home, want to stay in the home, don't want to sell the home. Possibly it could be a situation. Can't qualify for a home equity loan or refinance because of limited cash flow or poor credit. So you could go through the refinance process in order to get better terms, adjust the loan, possibly get some cash flow, but you can't do that because of some other circumstances such as cash flow or credit. Then this would be a consideration in that instance. What is required for a reverse mortgage? Property type. So if you own a house condominium or town home or a manufactured home built on or after June 15th, 1976, then you may be eligible for a reverse mortgage under F A F H A rules. Corporative housing owners cannot obtain reverse mortgages since they don't technically own the real estate they live in. They own shares of a corporation in New York. Your co-ops are common state law further prohibits reverse mortgages in co-ops, allowing them only in one to four family residences and condos. So age, equity and fees while reverse mortgages don't have income or credit score requirements, they still have rules about who qualifies. You must be at least 62 years old and you must either own your home free and clear or have a substantial amount of equity at least 50 percent borrowers must pay an origination fee and upfront mortgage insurance premium, other standard closing costs ongoing mortgage insurance premiums, M.I.P.s loan service fees sometimes and interest. The federal government limits how much lenders can charge for many of these items. Counseling, the U.S. Department of Housing and Urban Development, otherwise known as HUD HUD requires all perspective reverse mortgage borrowers to complete an H U D approved counseling session. So this counseling session, which usually costs around $125 should take at least 90 minutes and cover the pros and cons of taking out a reverse mortgage, given your unique financial and personal circumstances. It should explain how a reverse mortgage could affect your eligibility for Medicaid and supplemental security income S S I, which obviously could be a significant impact. If those are significantly impacted, things to consider the counselor should also go over the different ways that you can receive the proceeds, which we went over, which can be quite complex with those mixing and matching combinations and so on, six, six ways to do it. While that's a lot of choices, collateral protection, your responsibilities under reverse mortgage rules are to stay current on property tax and homeowners insurance. He can't be now now not paying your property tax, just because you're on the reverse mortgage, because obviously the lender will not like that. And homeowners association fees, if you have them and keep the home in good shape. So just because you're in the reverse mortgage, you shouldn't be punching holes in the walls or anything like that. Is that because that's not good for the for the banks either. So and if you stop living in the house for longer than one year, even it's because you're living in a long term care facility for medical reasons, then you'll have to repay the loan, which is usually accomplished by selling the house. So what are the costs of a reverse mortgage? You might ask HUD adjusted insurance premiums for reverse mortgages in October 2017, since lenders can't ask homeowners or their heirs to pay pay up if the loan balance grows larger than the home value, the insurance premiums provide a pool of funds that lenders can draw on so that they can't lose the money when this happens. So one one change was was an increase in the upfront premium from point 5% to 2% for three out of four borrowers and a decrease in the upfront premium from 2.5% to 2% for the other one out of four borrowers. The upfront premium used used to be tied to how much borrowers took out in the first year with homeowners who took out the most because they needed to pay off an existing mortgage paying the higher rate. Now all borrowers pay the same 2% rate. The upfront premium is calculated based on the home's value. So for every 100,000 in a praised value, you pay $2,000. That's $6,000 on a $300,000 house for example. In fact, the fee is capped at $6,000, even if your home is worth more. All borrowers must also pay annual MIPs of 0.5% formally 1.25% of the amount borrowed. This change saves borrowers $750 a year for every $100,000 borrowed and helps offset the higher upfront premium. It also means that the borrowers debt grows more slowly, preserving more of the homeowner's equity over time, providing a source of funds later in life and increasing the possibility of being able to pass down the home to errors. Reverse mortgage interest rates only the lump sum single disbursement reverse mortgage, which gives you all of the proceeds at once when your loan closes has a fixed interest rate. So if you take that lump sum one, which probably isn't the one that most people are thinking of because they're probably thinking they want to get payments. But if you get all the money upfront, then they can more easily calculate things kind of upfront and you got that fixed rate. In that case, otherwise you got the variables rates, which you got to deal with that changing rate situation. The other five options have adjustable interest rates, which makes sense since you're borrowing money over many years, not all at once. And interest rates are always changing. Variable reverse mortgages are tied to benchmark index, often the constant maturity treasury, the CMT index. So how do they figure the interest rate? They're going to tie it to an index, which is a standard kind of practice for that type of thing. In addition to one of the base rates, the lender adds a margin of one to 3% points. So if the index rate is 2.5% of the lender's margin is 2%, then your reverse mortgage interest rate will be 4.5%. So they're going to say it's the base rate plus a margin or 2% in this case. As of January 2022, lender's margins range from 1.5% to 2.5% interest compounds over the life of the reverse mortgage and your credit score does not affect your reverse mortgage rate or your ability to qualify, though it does affect whether the lender may require a life expectancy set aside account for your property taxes, homeowners insurance and other required property charges. How much can you borrow with a reverse mortgage? The proceeds that you'll receive from a reverse mortgage will depend on the lender and your payment plan for an HECM. The amount that you can borrow will be based on on the youngest borrower's age, the loan's interest rate and the lesser of your home's appraised value or the FHA's maximum claim amount, which is $970,800 as of January 1st, 2022. So obviously, if you're going to get payments throughout a time frame and there's no end date on it, so you've got to do some life expectancy calculations, so that's going to be on the age and the equity in the home and the interest rates and so on to help figure that out. So however, you can't borrow 100% of what your home is worth. So you can't borrow up to 100% because that would be too risky for the lender because if they sold the home just because of the closing cost, they would lose money on that so they still want some equity in the home. Or anywhere close to it, part of your home equity must be used to pay the loans expenses, including mortgage premiums and interest. Here are a few other things that you need to know about how much you can borrow. The loan proceeds are based on the age of the youngest borrower or so that's going to be because their life expectancy. If you're going to say we're going to keep making payments until this person is out of the home, possibly dies at that point, right? So if the borrower is married, the younger spouse, even if the younger spouse is not a borrower, the older, the older, the youngest borrower is the higher the loan proceeds, the lower the mortgage rate, the more you can borrow the higher your properties appraisal value, the more you can borrow a stronger reverse mortgage financial assessment increases the proceeds that you'll receive because the lender won't withhold part of them to pay property taxes and homeowners insurance on your behalf. How much can you actually borrow is based on what's called the initial principal limit. The federal government lowered the initial principal limit in October 2017, making it harder for homeowners, especially younger ones, to qualify for a reverse mortgage. On the upside, the change helps borrowers preserve more of their equity. The government lowered the limit for the same reason that it changed insurance premiums because the mortgage insurance funds deficit had nearly doubled over the past fiscal year. This is the fund that pays lenders and protects taxpayers from reverse mortgage losses. To further complicate things, you can't borrow all of your initial principal limit in the first year when you choose a lump sum or a line of credit. Instead, you can borrow up to 60% or more if you're using the money to pay off your forward mortgage. If you choose a lump sum, the amount that you get up front is all you will ever get. If you choose the line of credit, then your credit line will grow over time, but only if you have unused funds in your line. Avoiding reverse mortgage scams with a product as potentially lucrative as a reverse mortgage because obviously now you're getting cash flow out of this, that could be a place for scammers to try to scam because you got a lot of cash flow going on in it. And a vulnerable population of borrowers, clearly you're talking about people that might be in financial need and in a time in their lives where they don't have the capacity to do other things for cash flow, who may either have cognitive or impairments or be desperately seeking financial salvation scams abound, of course. Unscrupulous vendors and home improvement contractors have targeted seniors to help them secure reverse mortgages to pay for home improvements, in other words so they can make bank. So the vendors or contractors may or may not actually deliver on promised quality work. They might just steal the homeowner's money. So relatives, caregivers and financial advisors have also taken advantage of seniors either by using a power of attorney to reverse mortgage the home, then stealing the proceeds or by convincing them to buy a financial product such as an annuity or whole life insurance policy that the senior can only afford by obtaining a reverse mortgage. So obviously these things have so these transactions is likely to be only in the so-called best interest of the financial advisors, relative or caregiver. These are just a few of the reverse mortgage scams that can trip up unwitting homeowners. So do this to avoid foreclosure from a reverse mortgage. Another danger associated with a reverse mortgage is the possibility of foreclosure, even though the borrower isn't responsible for making any mortgage payments and therefore I can't become delinquent on them. A reverse mortgage requires the borrower to meet certain conditions. Failing to meet these conditions allows the lender to foreclose. So a reverse mortgage borrower, you are required to live in the home and maintain it. So you got to actually be in the home. So if the home falls into disrepair, it won't be worth fair market value when it's time to sell. So clearly the bank wants you to be in the home because if you're not in the home, it's going to deteriorate and won't be worth the fair market value. And the lender won't be able to recoup the full amount that it has extended to the borrower. Reverse mortgage borrowers are also required to stay current on property taxes and homeowners insurance. Because if they're not, then that would impede the ability for the bank to sell the home at the point of death or when the home converts or is going to be sold. Again, the lender imposes these requirements to protect its interest in the home. If you don't pay your property taxes, then the local tax authority can seize the house. If you don't have homeowners insurance and there's a house fire, the lender's collateral is damaged. Is a reverse mortgage expensive? Home equity conversion mortgages, the HECMs, the most common type of reverse mortgage, bring a number of one time fees and ongoing costs. The most significant of these are origination fees, closing costs, and mortgage insurance premiums, along with the interest the borrower accumulates on the loan balance. When do you have to repay a reverse mortgage? The lender will require the borrower to repay the reverse mortgage if the borrower does any of these things. Sells the home, resides outside the home for more than a year, passes away, fault failed to maintain property, stops paying your homeowners insurance premiums or property taxes. There are some exceptions to these rules for eligible non-borrowing spouses who want to keep living in the home after their borrowing spouse passes away. Can you refinance a reverse mortgage? Yes, you can refinance a reverse mortgage because of the origination fee, upfront mortgage insurance premiums and other closing costs. Refinancing a reverse mortgage should be reserved for situations where a spouse needs to be added to the loan. More equity is needed or the interest rate can be lowered substantially.