Where do you want to go today . . . and tomorrow? If Bill Gates hadn't known where he wanted to go, he probably would have ended up somewhere else. The same goes for your portfolio. If you're saving for a goal that's five, 10 or 20 years away, your reactions to the market's fluctuations will likely be different from those of someone whose focus is on speculation and short-term gains. If the lofty levels of stocks have you spooked, consider dollar-cost averaging into investments you'd like to own. By making smaller purchases on a consistent schedule, you could be in a better position to take advantage of the market's fluctuations without a lot of headaches.

Know thyself. Many people don't know their risk tolerance. Ask yourself how you'd feel if you invested in a stock and two weeks later, only half of your investment was left. If you get sick just thinking about it, then maybe the stock market isn't for you-at least when it comes to investment fads, hot tips and initial public offerings. If you can't afford to lose some money, consider other investments.