The first decade of the new millennium is now over and most of us might say, "Good riddance."

The past 10 years have been dubbed the "lost decade" because investors have little or nothing to show for it.

The stock market, whether measured by the blue chip Dow Jones industrial average or the broader Standard & Poor's 500 index, was at a lower level on the last day of the year than it was a decade ago. That hasn't happened since the 1930s, the era of the Great Depression."The Zeros is such a good name for it. Good-bye to the Zeros and zero return on the S&P;," says James Angel, an associate professor of finance at Georgetown University.

As rare as it is for stocks not to gain ground over a decade, some market experts say that the 1990s with its long bull market was the unusual decade. By 2000, we were lulled into thinking stocks only went up.

"We came into this decade with very high expectations," says Richard Cripps, chief investment officer of EquityCompass Strategies in Baltimore. "The risk of equity investing seemed very small. We certainly are at the other end right now."

As much as we would like to forget the "lost decade," it's useful to think about what lessons we can learn from it. Consider:

We'll always have bubbles We had two major bubbles, albeit in entirely different areas, within a single decade. The Internet bubble burst early on, but it wasn't that long before the herds stampeded into real estate, using exotic mortgages to buy houses they couldn't afford. Investment firms got severely burned or imploded after investing in mortgage-related securities even they didn't fully understand.

The aftermath of both excesses was painful, but not enough to prevent future bubbles. And some investment experts say gold shows signs of being the next one.

Be contrarian Just because bubbles will happen doesn't mean you have to get caught up in one. The best way to avoid the hype is not to follow the crowd.

"If you're standing in line to make an investment, get out of line," says Peter Ricchiuti, assistant dean at Tulane University's business school.

And keep your emotions in check.

"If you can avoid extreme swings of emotions, you can get through any period very, very well," says Brian Rogers, chairman of Baltimore's T. Rowe Price Group.

Rebalance regularly This simple exercise would have protected you from big losses in the past decade, Ricchiuti says.

Basically, decide what percentage of your portfolio should be stocks, bonds and cash. Then at least once a year, shift your investments to return to this original mix. This rebalancing forces you to sell your winners and put money in investments that haven't done as well.

Say you started 2008 with a portfolio of half bonds, half stock. By year-end, your percentage of stocks would have been way down. If you rebalanced then, you would have moved money out of bonds and into stocks to return to the 50-50 mix. So while other investors bailed out of stocks, you were buying shares at falling prices. And you would have been in a good position when stocks rallied more than 60 percent after hitting a decade low in early March.

"If people don't force themselves to rebalance, they do the wrong thing at the wrong time almost every single time," Ricchiuti says.

Diversify Some proclaim diversification no longer works given that almost everything went down in the market plunge of 2008. Sure, even a well-diversified portfolio lost money then, but not as much as those that weren't diversified, says Rick Kahler, a financial planner in Rapid City, S.D.

The definition of diversification, though, has evolved over the decade. Many investors early on figured they were diversified if they owned a variety of U.S. and international stocks. But now you must also own U.S. and foreign bonds, real estate, commodities, inflation-protected securities and more, Kahler says.

And it's not enough to have a broad range of assets. You need different strategies within your portfolio, adds J. Michael Martin, chief investment officer for Financial Advantage in Columbia. For example, your portfolio might include a strategy to benefit from market volatility.

Consume less, save more We're already doing this. At the start of the decade, the U.S. savings rate was just under 3 percent of disposable income, but by mid-decade that was cut in half. Saving is again in vogue, and the country's saving rate stood at 4.5 percent in the third quarter.

Financial experts expect many lessons of the past decade will be forgotten once the economy improves, but saving is one that may have staying power.

Part of that is demographics. Baby boomers are marching toward retirement, causing them to save more.

Build an emergency fund You should set aside at least six months' worth of living expenses to cover emergencies.

If you lost your job now, think how much more secure you would feel if you had enough resources to cover your expenses for a half-year or more.

Kahler, the South Dakota planner, says clients often balk at putting a chunk of cash in a low-interest savings account. "I remind them it's about safety. You are buying an insurance policy," he says.

Know what you own Investment lingo is confusing, the prospectuses mind-numbing and the choices exhausting. Frustrated, investors often end up spending little time choosing or watching their investments.

Target-date retirement funds, designed to make most decisions for passive investors, mushroomed in the past decade. But when stocks crashed, investors were stunned to find some target-date funds invested more aggressively than they thought.

The bottom line: Pay attention to your investments, because, unless you hire a professional, no one will likely do it for you.

"It's not a fun thing" but should be part of your life, says Peg Downey, a Silver Spring financial planner.

Be skeptical Even sophisticated investors fell for Bernie Madoff's Ponzi scheme. Financial planners say ever since the scandal, people have become more distrustful. But a little skepticism is good if it gets you asking questions before investing and keeps your eye on the portfolio afterward.

Just like bubbles, fraud won't go away.

"There will always be some bad guys and bad gals basically trying to defraud people for their own benefit," says Price's Rogers. "We can have this conversation in 25 years."

Cycles happen "Everything is cyclical and we had a really, really bad cycle," Rogers says. But after bad cycles, he says, "you tend to have good cycles."

Expect some bumps, though. Cripps of EquityCompass predicts two or three bear markets in the next decade along with two recessions, typical he says for a 10-year period. And while Cripps says this likely won't be a great year for stocks, he expects this new decade will be better than the last. "I'm much more optimistic than I was 10 years ago," he says.

Let's hope both are right.

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