Carmen Wong Ulrich: The Adviser

Investors today are living in a world governed by Murphy's Law: "If anything can go wrong, it will." Like,really wrong. With tumbling home prices and plunging 401(k) balances, bank merger mania and money fund mishaps, regular Joes are taking hits from all sides, says Carmen Wong Ulrich, host of CNBC's On the Money. "If it was just your bank and the market was doing fine, you'd feel that at least you have your retirement," she says. "But this is everything at once."

Ulrich was still in high school on Oct. 19, 1987, but that Black Monday left a stinging impact. "My dad called home around 4 p.m. to say he was coming home early. I asked why, and he said, 'Because the stock market crashed today, and I don't have a job anymore,' " she says. And so began Ulrich's crash course on the stock market. Here's a list of her investing do's and don'ts, which apply to any type of market:

Make your 401(k) match your stomach. In bull markets, investors feel brave. But they cower when the bear rears its head. So far this year, all but 4 percent of mutual funds are in the red, according to Morningstar. "Sleepless nights mean your stomach for risk isn't as strong as you thought," says Ulrich. She recommends that jittery investors, depending on their time horizon, stash somewhere between 30 percent and 40 percent of their portfolio in less risky investments, such as bond funds, treasury bills, or money market funds.

Don't monitor your balance like a hawk. Breaking the habit is tough, but obsessively tracking your portfolio adds unnecessary stress. "Make sure you're diversified, and check it twice a year at most," she says. "And try to understand that the loss you're seeing is what you have in your hand, but it's not disappearing." Down markets are essentially fire sales. Load up on stocks (via funds) now, and wait patiently for the upswing.

Be a cheapskate. Put as much money to work as you possibly can. For Ulrich, that means index funds, which charge relatively minuscule fees because they don't require an active manager. "You should be nickel-and-diming right now," she says.

Think of stock money as gambling money. Successful stock investing can feel like an instant scratch-off win (albeit one that requires a little homework). But "money you put into individual stocks is money you have to be prepared to lose," Ulrich warns investors. "Don't bank on them for the future." If you must, bet on a diversified basket of stocks within a particular industry or slice of the market by way of an index or exchange-traded fund.