If you have a 401(k), IRA, college savings plan or other investments, it's pretty likely you have lost quite a bit of money during the last two years - maybe close to half of what you had in early 2000.

Some investors have dealt with it by not looking. They cram statements into a drawer without peeking and figure they would rather not know if scandals such as Enron and WorldCom, a weak economy, a rash of bankruptcies, terrorism and the threat of war have any bearing on their retirement funds.

But it has been virtually impossible for anyone to escape one of the worst stock markets in U.S. history unscathed. And if you actually sneaked a peek at your own accounts, you may still feel shaken.

Many mutual funds that became staples in 401(k) plans and IRAs have fallen 33 percent or more since spring 2000. If you owned a technology stock or technology fund, the results are even worse: You may have lost 80 percent of your money.

So if you now find yourself face to face with the bear market, you might be wondering whether you should do something or go back into the unconscious bliss you once enjoyed.

Here's what you should do:

• Stay invested and reassure yourself. Although you might have lost a lot of money, you should not suffer dire consequences unless you are in retirement or about to retire.

• Do a check now to see how well you are positioned for retirement. Try the retirement savings calculator at www.usnews.com. Go to "personal finance," then "interactive tools." The calculator indicates whether you are likely to enjoy a retirement of leisure or poverty and how much more you need to save each month to improve the outlook.

• If you are in retirement or close to it and can't save enough to make up your losses, consider working longer or taking a part-time job in retirement that will allow you to do something totally different from your career.

Sue Stevens, a Deerfield, Ill., financial planner, says that way it feels like a new experience instead of fighting the same grind.

History also should provide some assurances. You aren't going to get your losses back quickly. After the stock market fell 48 percent in 1973-74 - compared to the recent 45 percent plunge - it took the market 7 1/2 years to get investors back to even. However, the market eventually did come back.

Flat markets have never lasted more than 15 years. Historically, the market has climbed 10 percent a year on average. That means that although your investments might have risen 30 percent in 1999 and fallen 30 percent this year, the good times balance out the bad over many years.

Currently, analysts are telling investors to expect stock market returns to climb no more than 5 percent to 7 percent a year for the next decade. But even the most pessimistic - those who expect a flat or down market for a longer period of time - think the market eventually will rise again because of the fundamental soundness of the economy.

• Ignore predictions about the market. If you think anyone can predict when the market's troubles will end, just ask who guessed back in the 1990s that stocks would fall 45 percent between spring 2000 and now.

Few saw the unusually harsh decline coming. Even the best and brightest analysts are poor at predicting the future in the stock market, so most don't try. They simply prepare their clients' investment portfolios as best as possible for a good market or awful market.

The way to do this is to hold a mixture of investments. The idea is that there are cycles in the market when different types of stocks and bonds are popular. Then the popular stocks become unpopular, and the stocks no one wanted previously become popular.

That's what happened at the end of the 1990s. If you were happy with the growth in your 401(k) then, your mutual funds were probably loaded with popular technology stocks. But if you have been shocked by losses of 50 percent or more during the past two years, it's probably because those very same technology stocks turned into dogs in 2000.

You can smooth out the bumps in the cycles by holding stock mutual funds and bond mutual funds. And you should hold stock funds that invest in a mixture of types of stocks - large, medium and small companies from a wide variety of industries. You also want growth stocks, which are pricey but expected to grow quickly, and value stocks, which are cheap and fall less hard if they don't grow as anticipated.

If you aren't sure what you have, look at the prospectus for each of your funds or call the toll-free number for your fund company and ask.

• Do a check-up on your investments. If you've lost a lot of money you may think you should dump your losing mutual funds. But even a losing fund might be better than other similar funds, so take a moment and do a quick check.

In general, you only dump funds if they've lost more than similar funds, or if they don't fit the categories you need for the different cycles of the market.

So, people in their 40s and 50s can have about 60 percent to 70 percent of their money in stocks or stock funds. People in their 20s can have all their retirement savings in the stock market, provided a downturn won't scare them into pulling the money out. Those within 10 years of retirement should start cutting back their stock portion a bit and adding more into bonds.

People who don't feel comfortable analyzing stocks and can't arrange a diverse portfolio of at least 20 companies from different industries should stick to stock funds. For total retirement savings, consider putting 30 percent into large company stock funds, 30 percent into midsize company stock funds, 20 percent into small company stock funds and 20 percent into a diversified international fund. In each of the categories, choose a growth fund that tries to select fast-growing companies, and a value fund that chooses slower-growing, cheap stocks.

You can also go to www.smartmoney.com, and use a tool called the "asset allocator" to figure out what mix of fund types would be most appropriate for your age and goals.

To figure out if your mutual funds are in good shape, remember to compare them only to similar funds. So compare a small-cap growth fund to other small-cap growth funds - not to a large-cap fund. You easily can accomplish this at www.morningstar.com.

At the Morningstar site, type in the name of your fund, then go to the "quick take" report and look at how your fund compares to its category. To do this, click on "performance" and then examine the "percent rank in category." Your fund should at least be in the top 50 percent. Examining the rank for one year is insignificant. The fund should rank in the top half of the category for at least five years or more. Also make sure that the fund manager responsible for the good years remains employed with the fund.

If you are willing to do a little more analysis, use the "portfolio" tab at the front of the home page and analyze all your funds together to make sure you really have a wide mixture of stocks and bonds to cushion the market's ups and downs.

As you analyze what you have, you are likely to want to sell what has done badly and instead buy bonds, which appear to be safe. But Edina, Minn. financial planner Ross Levin notes that because of the damage done to stocks, "you should probably sell what you love and buy what you hate." Remember, you are preparing for cycles and no cycle lasts forever.

"If you buy a pet, you must care for it, and if you buy a stock you must care for it too," says Jay Taparia, a Chicago money manager with Sanskar Investments.

Yet, people make two common mistakes: They hold onto bum stocks too long, waiting for them to climb again. They also form romantic attachments to stocks, holding more than they should in a diversified portfolio.

Instead of holding a stock and hoping for it to rise, Taparia tells investors to ask themselves sincerely if a stock that has fallen more than 90 percent is likely to grow about 5,000 percent in the next year to get back to even. Taparia suggests that the investor sell the stock and get the tax advantage of deducting the loss from any other gains or their ordinary income at tax time.

If the loss is more than $3,000, investors can carry the remaining loss into subsequent tax years and reduce their taxes. Once they sell the stock and get the tax advantage, an investor who truly believes in the stock can wait 30 days (an IRS rule) and buy the stock again.

Also, remember that no more than 20 percent of your portfolio should ever be concentrated in one industry and no more than 10 percent of your portfolio should be in a single stock, says Taparia.

He is particularly leery of company programs that allow employees to buy their employer stock at a 15 percent discount, or to put large amounts of their employer's stock in a 401(k).

Employees are dependent on their employer for a job, so they should not also rely on the strength of the employer for the future of their retirement investments.

Need some hand-holding? If you are in your savings years and at least 15 years from retirement, the key to your future is to stash away as much as possible and use a diversified portfolio.

If choosing funds is overwhelming you can make it simple by choosing just two funds - a total stock market index fund and a total bond market index fund. The first invests in almost the entire stock market, so you own a tiny piece of about 5,000 stocks. The second invests in the wide range of bonds. So if you are 40, you could put 50 percent into the stock index and 50 percent in the bond index.

If that remains overwhelming, and you want some advice, seek a certified financial planner and call (888) 806-7526, the International Association for Financial Planning, for some names. When you make an appointment, tell the planner you'd like just one to two hours of advice on how to allocate your portfolio. This probably costs about $130 an hour. You don't need the planner to manage your money day in and day out. If it makes you feel better, pay each year for a one-hour check-up.

• Evaluate college fund savings. While it might be OK to ignore a diversified retirement portfolio and just wait for the stock market to rebuild your nest egg, you don't have the luxury of time with college savings.

Stevens says that many parents are starting to realize they were too dependent on stocks in their children's college funds, and consequently have lost a lot of money.

She suggests people use balanced funds - rather than all stock funds - if children are eight years or closer to beginning college. The funds generally invest 60 percent in stocks and 40 percent in bonds. If a child is five years from college, nothing should be in stocks.

To make up for losses, parents might find that it's necessary to save $300 a month rather than $200, Stevens says.

She also urges all parents to make sure they write a will. In addition, she says they should review all beneficiaries on 401(k) plans, IRAs and other accounts to make sure that if they die, the appropriate people will inherit their assets.

• Make the most of what remains. If you have a 401(k) at work, save through that. You not only can let the money build up year after year without being taxed, but you get an income tax break on the money you put aside each year.

Also, if you are saving retirement money in a taxable account, start a Roth IRA instead. Once you put the money in it, you will never be taxed again on any of the gain - even when you start taking the money out during retirement. A regular IRA isn't taxed in your savings years either, but you must pay taxes when you start removing the money in retirement.

So, it may be wise to convert your IRA to a Roth IRA, but first make sure you meet the annual income limit (below $100,000) and realize that you could face a tax bill that one year. A conversion makes sense if your IRA has taken a big hit, because the taxes will be limited.

To save more money, people may need to tighten their belts.

Stevens suggests first looking for easy ways to cut costs, then deploying that money into retirement savings. For example, she says, people who have already reared their children can cut their life insurance back - possibly converting whole or variable policies to term insurance.

People paying more than 7 percent on their mortgages may refinance their homes at 6 percent rates. College graduates with student loans can consolidate the loans at close to 4 percent or 5 percent if they have never refinanced their loans.