Customer Reviews

Payback Time: Making Big Money Is the Best Revenge!

5 star:		(28)
4 star:		(6)
3 star:		(7)
2 star:		(4)
1 star:		(6)

 

 

I've read Rule # 1 back when it first came out and I thought it was excellent. I'm about halfway done with Payback Time and so far 90% of the information is simply rehashed information from his first book. The one thing that appears to have changed is that MSN now apparently gives 10 year data for free, which was not available when Rule # 1 came out (back then you had to pay a third-party company to obtain 10-year data about a stock and MSN and Yahoo only offered 5-year data if I remember correctly). So if you haven't read either book and are wondering which one to pick up I would say go for the second one (Payback Time). If you've read Rule # 1, reading the second book certainly won't hurt for repetition sake, just don't expect any major new information. The concept of stockpiling is nothing revolutionary. Simply buy more shares when the price goes down. Wow. The one thing I did not like about Payback Time is how Phil is constantly directing the reader back to his website for every little piece of extra information. And he doesn't tell you what link on his site to click on for each piece of information so you end up randomly clicking on his site until you find what you're looking for (not to mention the fact that you have to register in order to use the site in the first place and it keeps on logging you out every few minutes for some reason).
Having said that, I still have to give credit to Phil for his clear writing style. He has a special ability to take complex information and making it understandable to the average person. I also like the fact that he gives his email address in the book and encourages readers to contact him with any questions. I like that type of service. I will update this review as soon as I'm done reading the book.

3/16/10: As a side note, I also have noticed, like others, that many of the raving reviews for this book sound fake (some almost sound like an infomercial) and are from users who have only reviewed a single item (i.e. this book).

4/1/10: In chapter 5, "Eight Baby Steps to Wealth", Phil walks you through a tool on MSN's website called "Deluxe (stock) Screener" (also known as "Supercharge your search"). It's supposed to be a free stock screener that lets you find companies that match Phil's criteria for great companies (saves you a ton of time). Unfortunately, this tool no longer exists (MSN retired it back in November of '09!). However, Phil recently posted an entry on his blog saying that you can find the exact same information on google's website. If you go to "Google Finance" look for Stock Screener. It's supposed to be just as good as MSN's Deluxe Screener. I will be playing around with this tool and will post an update soon.

5/26: Remember how I said that Phil gives out his email address in his book and encourages readers to ask him questions? Well, I sent him a question (regarding the use of Google Finance - see my post from 4/1) in late March all I got was an automated reply saying that someone would get back to me and no one ever did. So much for that. So if you have any questions, I would call the number listed on Phil's website. They will answer your questions.

"Both low and high,
Rich and poor together." -- Psalm 49:2 (NKJV)

If you read and liked Rule #1 and are using that method, you probably will be disappointed in Payback Time. If Rule #1 seemed appealing, but was beyond what you could apply on your own, you'll probably find Payback Time easier to use.

I once attended a major investing seminar conducted by one of the most famous motivational speakers in the world. He spent two hours on an exercise where we were supposed to learn to buy low and sell high. Most people were delighted with that lesson, even though we only learned the principle . . . not how to implement it. I was shocked to see how little it takes to please those who don't know much about stock investing. But I assume you are well beyond that level.

If you are fan of Rule #1 (as I am), let me cut to the chase: Payback Time primarily gives you a buy-low-and-hold version of Rule #1 along with an update concerning online resources available and a more complete Web site to help you perform the details. Of the two books, Rule #1 is for those who want to be very active investors. Payback Time is for those who want to do less work and pay less attention to the market day-to-day.

Lest you take that point lightly, let me mention that I once had a book contract to write a similar book. I returned the contract after a few months of struggling to explain in simple language with not too many words how to do some similar evaluations. I found it to be harder than it was worth doing. As a result, I admire Phil Town for sticking with his writing to produce a book that is clear, simple, and not too hard to implement.

Do I take exception to anything he had to say? Sure I do. Anyone would. But the advice is pretty sound.

I thought the best part of the book was in defining the sell discipline, something few investment books take seriously. I think he sets a pretty high target, one that may cause you to miss some well-timed selling opportunities.

The main problem with the method is that to have lots of opportunities you require stock market collapses occurring reasonably often. During a period such as the 1990s (especially on the NASDAQ), you might find it difficult to apply the method to stocks you understand well that are dramatically under priced. In today's environment, I suspect bargains by this method are few, for instance.

My main quibble with the book is that Mr. Town spends about 20 percent of the content explaining that mutual fund returns aren't very good, the expenses piled onto mutual funds cause your returns to be much lower, and sharing his view that you cannot count on Social Security. All of this material was worth about two or three pages, not fifty.

Do your homework!

I have my own results to prove what I learned from Phil's Book Rule One and Payback Time. I started a 100K portfolio in february 2009 when all the technical indicators on the S&P 500 where indicating me to get in. I picked 8 stocks that I screened according to his methods that meet the Big 5 numbers criteria , had meaning, moat and good management. Its been a little more than a year , i sold a few times and bought back. Currently my portfolio is up 161.5% in a little more than one year. I started using packback time as a screening tool now and picked a few Rule one stocks with Payback times of less than 7 years 1 month ago, since then I am up 11% compared to the Dow 3.26% . I am a believer in Phil's teaching. If you follow every step methodically and get your emotions out of you decision making I am sure you'll more than beat the market. I am doing it and expect to keep doing it. I knew very little about investing before reading Phil Town's . To me this are the best practical books about investing in stocks for the long term. Anyone that doesn't get the result I am getting is not following all the steps thoroughly.

Great job Phil.

I hope to to talk to you soon on your blog.

Ok, I'll try to be concise here. I like the book. Yes, some of the concepts in Rule #1 are re-hashed here, but I thought the presentation from this book was better. If you buy the book, however, you'll see that you are offered a "scholarship" to attend a Payback Time workshop for free, which I decided to attend. As most people know, very few things in life are for free. As I expected from the "free" 2-day workshop, it was a technique to get people interested in purchasing additional training and access to software tools/data which have been developed specifically for using the techniques outlined by Phil in the book to find good companies to invest in. For the most part, the free workshop covered what was in the book, and there was some introductory coverage of options as well. It was nice to have someone available to address audience questions from topics not understood from the book, but I was disappointed that about half of the workshop time morphed into discussion about buying the tools/data & training. What really surprised me though is the book focused mostly on "investing", but the trainers talked a lot about "trading", especially with options. While I thought the tools/training looked pretty good, even the lowest package they offered was for $5,000 (which was for 6 months access to the tools/data), it felt like for me to spend that much money, I would really need to spend a lot of time learning, paper trading, and watching the markets, which I really don't have. I'd love to quit my job and be a trader, but in this economy it feels too risky right now. It's too bad that Phil doesn't blog/share a little more often for free on his website ([...]) so I could've better followed his ideas in advance of attending the class. Since some of the packages included "access to Phil" (to ask questions, discuss ideas, etc.) I might've been more inclined to spend the money had I had a little more experience with Phil in advance of the class. Phil actually Skype'd into the session to explain the packages and answer audience questions. I am still interested in the offerings, so I may go back later if circumstances change.

The principles outlined by Phil Town in "Payback Time" seem sound and worthy of consideration. However, there are two concerns with his 'stockpiling' methods. First, it requires continuing income available for adding to your investments; and, second, it requires a potentially long time period before you may see any gains from your continued investments. This makes some sense for working people with 20 to 30 years before they need access to their invested assets. But if you're retired with little or no extra income available for investing, I wouldn't recommend this method of beating the stock market. Save your money on this book, and read Phil's "Rule #1" book again!

I've been buying books off of Amazon now for about 10 years. I read some great books and I've read some terrible books but this is the first book that I felt like I had to review. I have so many problems with payback time I don't even know where to begin. First off, Phil Towns other book Rule #1 is a good book and if you really want a book by the author, Rule #1 is the book to get. Payback time is just a bad version of the authors first book. After reading Rule #1 I really liked Phil Town but after now reading Payback Time, he is obviously just a charismatic salesman.

My main problems with Payback Time are,
1. It is a complete copy of Rule #1, except worse.
2. He claims it is a prequel to Rule #1, except in Payback Time he claims that you should "stockpile" stocks and make 24% per year. So why if this is possible would anyone master "stockpiling" and then move down to the rule #1 system and accept only 15% a year?
3. At least in the Rule #1 system there is a mechanical stop to limit losses, while in Payback Time a noobie investor could potentially buy a dead weight headed much lower. Very irresponsible to make investing newcomers feel like they can be like Warren Buffett, when in all actuality they will most likely end up suckers.

This book is just a huckster rehash that makes you feel like you just got ripped off.

I dont normally post reviews but wanted to add my thoughts about this book.

I read Rule number #1 when it first came out and it got me interested in investing. I found i did not like trading and could never time the tools right. I was always getting in to late or out to fast. I started studying more on investing and found that I liked the approach that is more akin to payback time.

I like to use the way Phil recommend to value a company to get an initial feel for the value and his calculators make this easy. He also makes very good points about buy a business and not a stock and that you should be interested in what you buy and understand it.

Both Rule# 1 and payback time are easy to read and you finish understanding how to begin to value a company (something I did not feel good about after reading my first few investment books.

That being said Payback time does not offer a whole lot of information over Rule #1. I was hoping that Phil was going to provide a way to evaluate cash flow or another method of evaluation. Instead the addition of payback time is only how to grow estimated earnings to determine at what point you could buy the whole business. Phil also clarifies some of his information from Rule 1 but you could have found most of this information for free on his website. The idea of a Berky is simply having a account you have cash flowing into at regular intervals and having a plan to use this cash to invest.

I do not feel like I wasted my money on this book because I did get some useful information and it was a good review. I think this is an excellent book for someone just starting out and would recommend this book over Rule #1. It does not cover the tools but I found them to be kind useless in todays market. I think they may have there place when the bear turns into a bull and may revisit them in the future.

I think the biggest lesson that can be learned from the last few years is that Warren Buffet is on to something when he sits on a cash horde for years and buys like crazy when the markets crash. Fear and greed are powerful things but knowing what something is worth gives you the knowledge and comfort zone to pull the trigger. Payback time will not make you a PHD in Finance but it will give you a better starting point then most other investment books out there.

From there spend some time reading seeking alpha, the motley fool and other investing websites.

Hope this helps.

I just finished this book. Unlike some reviewers here, I did note significant differences between Rule #1 and Payback Time --- Payback Time is more geared towards fundamentals and knowing the business you own; Rule #1 leaned ever so slightly in the direction of technical analysis.

With the discussion of Floors and Ceilings, though, we're still in the realm of doing some charting.

The problems I see are that Mr. Town is: a) hyping his website, but not realizing it does not deliver what he claims it will (e.g., where on the website is this "Investor Profile Questionnaire"? I certainly cannot find it ... ) ; b) a schill for his seminars and ancillary products --- Ok, I get it dude, you offer workshops, but do you really have to spend pages and pages selling me on the idea of going to them?

And besides, if you (Phil Town) are as rich as you claim to be, why set up these investment seminars in the first place? Just to "help" people? C'mon.

But really, the part that bugged me most was the description in the book of the wonderful associated website, and in reality the website just does not deliver on those promises.

On the plus side, the website does describe using Google Finance screens instead of the recently scaled back MSN screen. That alone merited an extra star ... otherwise I would only have rated this book "Fair" with two stars rather than three.

I found this book to be an entertaining introduction into value investing approximately a year and a half ago when it came out. It is written in a style to motivate someone who might feel incompetent to try to invest their own money. The book gave me the confidence to start investing and with his advice, I made several very good investment decisions (buying Netflix at $75/share, for one... which I just sold at a 285% profit). I also made several unnecessarily risky investment decisions (buying Joe's Jeans at $1.90/share... which decreased by 50% but I am still holding on because I still believe in the company's long-term potential). My losses have been more than outshadowed by good picks.

I agree with another reviewer's post that the website does NOT deliver on its promises and also that I found his method for valuing companies to be overly risk-averse. If you stuck with his recommended margin of error, you would NEVER invest in the market. I found very few stocks that met the balance sheet test by his margin of error and those that met that test I decided against for other reasons (no barriers to entry, declining value as technology advances, etc.) I used his calculator online to value companies but only in relation to each other. I didn't wait for his target price to buy... because I never would have invested $1 if I had.

I am currently reading Ben Graham's Security Analysis, which I find much more useful. However, I don't know that I would have been ready to dive into Security Analysis as a novice and thereafter be so willing to experiment if I had read it a year and a half ago.

Thus, I recommend this book in general to other complete novices. It is good, sound advice and it is written in a way to explain complex ideas to someone without a finance education. However, I'd also recommend other sources like fool.com. Value investing information can be learned from other sources... this is just one of them. It isn't magic or a different type of value investing than Buffett or Stock Advisor on fool.com. I also recommend reading other things after you make a few stock purchases because reading this book will not be the only thing you need to read for investing long-term. It is a continual process of trial, error, study, testing theory, trial, error... you never stop learning.

Not sure why most of the reviewers found both of his books teaching the same. While I found quite a contrast in the teachings.
Rule#1's main mantra was going-in-and-out along with the big guys this system makes the portfolio immune to market crashes, at least that is what Mr. Town said.

However, in Payback time he is going back on what he taught in his first book; basically he is admitting the mistakes he might have goofed around selling-and-buying on minor movements of MACD, Stochastics, and MA. Insted he is referring back to what Mr. Buffet has been doing all along, buy-and-hold, and buy more when the "value" is greater than "price".

Wake up and smell the smoke guys, he is making money selling his book, not in stocks. If he could turn $1000 to 1 million in 5 years, then its been more than 30 years he is in the market, so he must be in the Forbes 400 list by now, is he?
No, instead he is telling us all the arena-tours he is speeching around with ex. Presidents.