Investment-management

Jan-Oliver Ohloff

The book's three authors (The George Washington University Business School, Georgetown Business School, and 20+ years High Yield Experience) have used their knowledge and connections to get the best information available

Dzwonkowski, a Certified Financial Planner, has organized the book wisely; skeptics and garden variety readers in need of gentle convincing are dealt with in Part 1 ("Getting Acquainted with the Idea of Becoming a Millionaire") and, having set the hook at that section's close, Dzwonkowski moves into everything-adds-up, factual discourses on the mathematics of becoming a millionaire.

All of the usual topics are here - investment risks and rewards, the particulars of stock market and mutual fund forays, portfolios, estate planning and strategies - but Dzwonkowski's real success is in the presentation. As he says, "becoming a millionaire does not happen overnight," and this credo, combined with the real life tools and techniques he provides are the seasonings that make the monetary lectures herein nourishing.

And then there's that indefatigable optimism of his: "What are you waiting for? An engraved invitation? Then consider this your engraved invitation: We, the current members of The Millionaires Club, hereby extend to you an open invitation to join the Club ... The only qualification for membership ... is that you accumulate a million dollars of wealth ... This invitation is good for the rest of your life (it only expires when you do)."

Highly recommended for non-millionaires everywhere.

How You Can Become a Millionaire, recently written and published by Mr. Dzwonkowski, is an easy-to-understand, step-by-step guide for building a lifetime of wealth. Indeed, its like having an advisor 24 hours each day that helps show the way, and builds confidence in your ability.

How You Can Become a Millionaire is divided into four parts. The first sets the stage by offering you the reasons others are not millionaires...and outlines the steps for you to succeed. These steps are discussed in detail in the remaining three chapters.

Part Two continues your education on how to develop an Easy Payment plan to accomplish your goal. After all, if there are Easy Payment plans to buy a washing machine, why not one for financial success? Part Three offers a thorough understanding
of the investment world so you can swim with the big fish, and not be eaten by the sharks.

Part Four enables you, with all you've learned in One, Two and Three, to invest properly for maximum financial gain, where to put your savings, use mutual funds, investment strategies, develop the best portfolio for you ...even how to protect your wealth.

Ed Dzwonkowski offers (pardon the pun) a wealth of information on how to become financially independent. How You Can Become a Millionaire proposes the means "...to travel a different road than the one most people travel." In this reviewer's opinion, here is a book for every wage-earner, one that can change your life!

So the bottom line: For those who could implement the concepts already, this book provides no add value; for those who couldn't, this book can't help you, either.

The underlying theme is developing a value-based partnership between IT and the business process owners that IT supports. This is introduced and developed in Chapter 1 (Introduction), and is placed within the context of Porter's value chain. This chapter also covers value alignment as a guiding principle. Chapters 2 through 4 expand upon the concepts by explaining consequence-based thinking (a powerful technique for examining initiatives), organizational factors and issues in the form of matrixed resources and business/IT alignment, and value management.

Chapter 5 is particularly valuable because it shows how to transform the goals and objectives from the first four chapters into a strategy. The tactics that support the strategy are discussed in the subsequent chapters: drilling down into the small picture (Chapter 6), organizational details (Chapter 7), human capital management (Chapter 8) and investing in values (Chapter 9).

The final chapter, CIO responsibilities, and the appendices provide a strong foundation of guidelines and tools. I thought the appendices were particularly valuable, especially A (Sample Business Case Template) and (C) Desktop Development Standards and Procedures). Other material in the appendices includes (B) Personal Productivity Services Organization Overview and (D) Systems Development Contract.

There are two additional books that will nicely complement this one, and I recommend reading them after this one in the following order: Smart Business by Dave L. Chapman and Barry Sheehy, and Building Operational Excellence: Strategies to Improve It People and Processes by Dale Kutnick and Bruce Allen.

The book shares the common problem with the majority of technical books : redundant inflated text.

This book gave me the information I needed to get started. It was well written, with many real world examples. I did not have any trouble following it. It starts from the very beginning of the process and builds up. Starting with a description of the three classes of modification request. And ending with suggested modifications for your metrics program due to Object Oriented Technology.

I'd recommend this textbook to anyone who is just starting out in the Software Maintenance field. It has helped me considerably. It would probably be too general for someone already experienced with Software Configuration Management programs and Software Maintainability Metrics.

My only complaint is that it could have used more checklists and a web site.

The main value is the maintenance-oriented framework that the author provides, which encompasses planning activities, a set of processes and organizational and cost considerations. These are valuable guidelines and will help to clearly define the transition between application delivery and maintenance and support operations within IT. Much of this material is also applicable to product-based organizations that produce commercial software.

I would have liked more information about maintenance metrics that I could have compared to resources I already have, and also would have liked more emphasis on reliability and quality metrics. However, the book is more focused on processes and support, and it shines in those areas. If you are interested in software maintenance from developer's and software engineering viewpoints I recommend "Designing Maintainable Software" by Dennis D. Smith (ISBN 0387987835). For metrics I strongly recommend "Software Metrics: Establishing a Company-wide Program" by Robert B. Grady ISBN 0138218447).

He spans the field of investing from those who are interested in high risk stocks to those who wish to invest there money more safely into money markets. The book has tips for every investor, which is both a good and a bad thing.

Sease focuses on a broad scope of savings and investment strategies for the person looking to explore the field. Being this broad, I do not recommend this book to those who look to dig up information on more specific types of investment strategies. There are various books out there to meet the needs of the more narrow investor, but Sease's book is focusing on the entire spectrum to inform his readers of the possiblities that are out there.

To be honest, I read this book for an economics class that I am taking, and initially I was not thrilled. In reading it, however, I have learned much more about the market and investing then I could have imagined. It is a stretch, but I may have even enjoyed the book from time to time.

I highly recommend this book for those who are looking to make the kind of retirement/nest egg/tuition money that they really dream of having. It will allow the average investor to jump into what can often be a very confusing and sometimes scary market. If nothing else you will understand the market better should you ever decide that you would like to try investing.

The question is: without robbing a bank or playing the LOTTO, how can I find more money to invest wisely in order to really build up as large and secure a financial account as possible by the time I retire? It's a question that troubles me, and many people like me. I'm already trying to sock away as much as possible. I'd like to be socking away more. But how?

After you buy Sease's book, you might want to check out another book by a financial services CEO named Wade Dokken (of American Skandia, one of the fastest growing variable annuity and mutual fund companies). His new book is called "New Century, New Deal: How To Turn Your Wages Into Wealth Through Social Security Choice."

Dokken has a revolutionary premise: you already have more money with which you could invest for your retirement; the problem is that instead of using that money wisely and productively, you're sending it to Washington in the form of your Social Security taxes. Hmmm. Interesting. And frustrating.

But what if you could take 2%, or 4%, or eventually even 8% of the 12.4% you now send to the bureaucrats in Washington, and instead deposit that money in a personal retirement account conservatively invested in, say, stock mutual funds, or TIPS, for example?

In other words, what if you could apply Sease's sound investing advice with Dokken's revolutionary premise on how to scrape up more money to invest? Well, Dokken runs the numbers. They're astounding. You almost have to run them yourself, blink hard, and then run them again. But they're true: if you could invest 8% of your income (two-thirds of your Social Security taxes) in an IRA or 401(k)-like account you could retire with well over $1 million, possibly even more than $2 million. And even if Washington only created 2% accounts, you could still build up an account worth a quarter of million or more.

And the risk, over the long term, is minimal. Why? Partly because the markets have always grown 6-9% annually over the long haul. And partly because you'd be engaged in the ultimate act of dollar-cost-averaging. You'd be investing relatively small portions of money in equities out of each paycheck, every two weeks for the rest of your working life.

Sease is right -- invest what you have wisely and shrewdly.

But Dokken (interestingly enough, a lifelong Democrat) is also right -- turn up the heat on Washington for the freedom to invest more of YOUR OWN MONEY in your own personal retirement account.

"Do you want the stock market to go up or down?" Mr. Sease poses that question to help you decide if you are an investor or not. Investors want the market to go down so they can buy cheap. Those who are living from their investments or cashing them out want high prices, because they will be selling rather than buying in the future.

This book provides a good general overview of the role of savings, stocks, bonds, investment brokers, investment managers, financial advisors, mutual funds, public sources of information in helping you make money. Unlike many such books that then espouse one solution for all, the book segments its readers by age, financial obligations, and income to suggest different methods to be used to implement the book's ideas.

The book has a worthwhile goal: "to free you from the tyranny of the financial services industry and the wasted time spent chasing outsize returns . . . ." He has some candid views to share in this regard. "I don't like stockbrokers." He later clarifies this as the full-service stockbrokers.

Basically, Mr. Sease is an advocate of the efficient market hypothesis for financial securities. This means that most people will not be able to outperform the market averages. The track record of professional money managers certainly is consistent with this hypothesis. But you can match the averages cheaply by buying indexed, no-load mutual funds. Almost all of his portfolios have some of these in them. As you get closer to needing the money, he suggests putting money into bonds to protect your principal from the large fluctuations that stocks often experience. He also demonstrates the power of compounding to encourage you to save more and save sooner.

Despite the basic soundness of Mr. Sease's approach, the book itself does have some weaknesses that you should be aware of. Most of these weaknesses seem to relate to trying to cover too many subjects in one slim volume.

For example, the most important thing you can do to be more successful with your investing is to have written goals that you regularly review. These goals should include subjects like housing, education for your children, financial security for your family, long-term health care, and retirement. Some people will also want to include philanthropy and caring for other family members, including parents, siblings, and grandchildren. But that's up to you. Although the book does refer to goals, it does not begin to do so until the middle of the book and treats the goals as though you already have them. My experience in working with successful, educated, high-income people is that almost none of them have written financial goals that they review. For some ideas on how to do this, I suggest you review the excellent material in Charles Schwab's new book, You're 50 -- Now What?

Second, the subject of what you can expect from stocks and the case for indexed mutual funds is made much better than in this book by John Bogle in Common Sense About Mutual Funds. You should take a look at that book. You should also consider the new book, What if Boomers Can't Retire?, to understand the risk of common stocks failing to provide their historical returns in the future.

Also, financial investments are not the best way to build financial security. Books like Rich Dad, Poor Dad make the case for creating investments that generate cash from a young age. In most cases, these investments will either be real estate or businesses. These subjects deserve equal time in a book about investing, but are not considered in this one. In the new book, Rich Kid, Smart Kid, is a fascinating example of how a young man learned this lesson by his father refusing to buy the son a new set of golf clubs. In the process, the son learned how to start his own vending machine business, make investments for his own college education, and let his business pay for the golf clubs. That is a far more powerful paradigm than is presented here.

I agree in principle with almost everything said in this book, but I would not encourage most people to read the book until after they had read the other books I suggested. At that time, the reader will be ready for the sample portfolios in this book which present some interesting alternatives for getting good long-term returns from financial investing with acceptable risk for the timeframes involved.

After you have finished considering the model portfolios in this book, I suggest that you test them for risk by assuming that both the stock and bond markets perform as badly as they ever have in the past. Then look at what you projected returns look like. Imagine how you would feel if you experienced these returns. If you would be disgusted and unhappy, chances are that you are taking on too much risk.

Take out unnecessary risk first if you want to enjoy better investment returns, sounder sleep, and less emotion-tossed investing. Otherwise, you, too, could become another example of buying high and selling low.