The markets have nearly rebounded to the historic highs reached in 2000, but investors haven't forgotten the emotional devastation of the tech bubble burst and its aftermath. History tells us the markets will cycle down again eventually; we just don't know exactly when. When that downturn comes, a financial plan (the big picture), an investment strategy (how you get to the big picture) and a trusted financial advisor can make the difference between staying the course and bailing out too soon.

Not surprisingly, researchers have found that the human brain wants to be happy and will in fact bend our perceptions of reality to that end. Faced with evidence that we have made a mistake in judgment, our brain denies, rationalizes, blames and defends, because admitting mistakes damages our self esteem and makes us unhappy.

Faced with investment decisions, our brain goes looking for ways to support its quest for happiness. We envelope ourselves with information--from the media, from the stock ticker, from cocktail party conversations--and gain a sense of satisfaction that we have superior knowledge. We don't. We have a glut of information.

That false sense of knowledge leads us to make an investment based on past performance--despite prospectus disclaimers warning us that past performance does not guarantee future gain. We buy what's popular--because our brain tells us that many people can't be wrong. We resist selling investments when performance indicates we should--because we don't want to admit we were wrong. And we invest in stocks simply because we recognize the name or, worse yet, because we work for the company.

If you've fallen victim to these financial foibles in the past, now is the time to evaluate your financial strategy. That starts with a financial professional you can trust to be a sounding board--maybe even the voice of reason--when you start to panic about your portfolio. That trusted advisor should be helping you develop a financial plan that starts with determining your life goals, not just a target amount for your investments. Be upfront about your assets, your liabilities, your hopes and your fears so your advisor gets a comprehensive picture of what you hope to accomplish.

To implement your plan, you need an investment strategy that fits your time frame, money needs and risk tolerance. With your financial professional, determine which investment vehicles are most suitable to your profile. That includes understanding what criteria or scenario should prompt you to sell an investment, hold it or buy more.

When the inevitable happens, and the markets retreat, don't look to the media, your friends or even the major indexes for your next move. Look to the financial plan and investment strategy you and your financial professional developed and evaluate if those should change in the current climate. Good markets will always, eventually, go bad. With preparation, planning and professional financial counsel, that doesn't have to be true of your portfolio.

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