CLARKONOMICS: It's not often that we have back-to-back Clarkonomics segments on the show. But there's been so much in the media about the bear stock market that Clark felt compelled to do it.

A bear market is when things are down 20% from their peak. That understandably has people frightened. So many folks stop Clark on the street to tell him they're dumping their mutual fund stock-type holdings and going into safe stable-value kind of things.

It got Clark thinking about how far down he is this year. After crunching the numbers, it turns out he's down 4.8% over the last 12 months. Sure, that hurts, but it's not a decline of 20%.

So how is he "beating" the market? The secret is not that he knows about special stocks or has an exotic investment strategy; it's that he's taken a meat-and-potatoes approach to investing.

His largest allocation is putting just under 40% of his money into tax-free municipal bonds. The rest is divided evenly among large companies, small companies and the international markets. Clark also has a small amount of money in commodities and REITs.

In a word, he's diversified.

The penny-pincher also benefits through dollar-cost averaging. This means he keeps buying more shares every month instead of playing red light/green light based on market conditions. So as the market declines, his dollar buys more shares. T. Rowe Price's Automatic Asset Builder allows you to take advantage of dollar-cost averaging by investing as little as $50/month automatically out of your paycheck.

The purpose of investing is to create financial security. If you have a need to treat investing as a sport, Charles Schwab advises the "core and explore" approach. Put the money you really need to have into your core investments, similar to those that Clark described above. Then take a small amount that you won't lose sleep over and spread it around among the more volatile investments you crave.

As always, check Clark's investing guide if you're just getting started. He particularly likes the targeted retirement funds for those who want to take a "set it and forget it" approach to investing.