Well, the hats and horns have been put away, the New Year is officially here. You be the judge of Y2K's effect on life as we know it. I long ago gave up trying to convince people that there is still another year left in this millennium. Popular culture has decreed that this is the start of the new millennium, and no amount of reasoning is likely to change that. I suppose it is related to our fascination with round numbers.

Every time the stock markets approached a millennial milestone over the past decade--and there have been plenty of them--investors held their collective breath. In January 1990, the Dow Jones Industrial Average was at 2,753; it closed the century just shy of 11,500. Perhaps the two biggest round numbers were when the Dow Jones Industrial Average topped 10,000 for the first time in April 1999 and in December when the NASDAQ went above 4,000.

This has certainly been a memorable decade and a fitting cap to an amazing century. Just think of all the changes we have witnessed in the past 10 years: The Berlin Wall fell, Japan's economic juggernaut collapsed and has begun to rebound, computers are everywhere, and the Internet has become ubiquitous (dot com), from information to shopping to entertainment.

Corporate mergers have rocked the business world this decade. Who had ever heard of Business Television that would let you see what the financial markets are doing all day, every day? Now we have financial market places, Web sites and discount brokerages so that even the most cautious among us can manage our own assets with minimal trauma.

If you have been a spectator during the past 10 years, it's time to get off the sidelines and take some risks. If you have read many of these columns, you probably know that I favor no-load mutual funds as a way for the average investor to grow assets into a healthy retirement package. Sure, there are some who are ready to play in the big leagues (individual stocks), but for most of us who are just starting to build a portfolio of investments, mutual funds are the place to begin.

At the end of the 1980s, individuals had invested about $980 million in mutual funds. Today that figure is more than $5.5 trillion. Here are some numbers:

The average diversified stock fund climbed an amazing 339 percent over the decade. Compare that to the Consumer Price Index (i.e., inflation), which advanced only 34 percent in the same period. Even stodgy old long-term Treasury bond funds returned nearly triple the rate of inflation. Aggressive growth funds, on average, returned an annualized 15.99 percent, or 341.20 percent over the 10-year period. A $10,000 investment at the beginning of the 1990s would be worth $44,120 today. If you didn't have your extra cash stashed in one of these investments, you missed out on one of the greatest opportunities in recorded history to build wealth.

Let's go back to that CPI number again. A decade of relatively modest inflation, in this case averaging only 2.98 percent per year, resulted in a 34.11 percent drop in purchasing power by the end of the decade. When you are actively employed, you probably absorb such changes relatively well. But when you retire, those little bumps in the CPI add up to a serious erosion in your standard of living. As we live longer, our retirement nest egg has to be inflation proof for 20, 30 or more years. There is only one way to achieve that goal, and that is by building a personal investment portfolio and letting it work for you.

Retirement programs (including Social Security) that feature cost-of-living adjustments (COLA) kept pace with the overall trend, but most older Americans will tell you that the real cost of living rose much faster than the government's reported inflation figure. Prescription drugs, as one example, have gone up at a 12 percent annual rate since 1993.

For most of the 1990s, we have been in an unprecedented economic expansion. Some call it a "Goldilocks" economy: not too hot . . . not too cold . . . just right. An activist Federal Reserve Board has kept inflation in check, unemployment is at unbelievably low levels, and corporate profits continue to rise. All of these factors make this a wonderful environment in which to invest. There are those who have been warning that this can't keep going forever. Of course, many of them have been warning that for several years now. We know that the economy moves in cycles, and even the greatest market run of all time will come to an end one day. Whether it ends with a bang or a whimper, we'll have to wait and see.

The only way for you to benefit from this extraordinary prosperity is by being an active investor. Start now. Invest regularly. Stop procrastinating! Even if the markets take a dive, an investor with long-term goals (such as retirement) will be able to weather the downdrafts that are sure to come.

American Federation of Teachers, AFL•CIO - 555 New Jersey Avenue, NW - Washington, DC 20001