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NEW YORK (CNN/Money) - I check the balance on my 401(k) every day and I've noticed that I've lost more than $1,000 since early March. Is the stock market going to maintain this downward spiral? I'm thinking of moving my money into less volatile funds, but wanted to get your input.

—Madeline, Niles, Michigan

First, why in the world are you checking your 401(k) balance every day? Though you should certainly put some thought and effort into charting your investment strategy, obsessive monitoring is likely to do more harm to your financial health than good.

Why? Because it will probably have you itching to do something -- that is, move your money around. But switching from one investment to another on the basis of what's happened in the recent past isn't a long-term investment strategy.

Think about it. You're making your move on what's already happened. Which means the financial markets, including the prices of all your investments, have already adjusted to those events. So unless you have some brilliant insight into how different investments are going to act in the near future, you're really just winging it.

And if you continue this sort of reaction to the market's latest wiggle (and, by the way, a 4 percent decline from the beginning of March to the end of April is not a downward spiral), the performance of your 401(k) will be subject to your emotional reactions to the market.

This is not a way to build long-term wealth.

I suggest you do three things.

First, start thinking about the long-term instead of what happened in the past 30 minutes or 30 days. Who cares if the market recovers "soon"? Your goal for the money you're saving for retirement in your 401(k) should be to increase the future purchasing power of your account's value so it can support you in retirement.

Short-term ups and downs aren't that important. So you want to invest in a way that fosters long term growth, which in turn means investing in a diversified portfolio that includes both stocks and bonds. The proportion in which you hold stocks and bonds will vary depending on how much short-term bumpiness you can stand and how long your money will remain invested.

For help on setting a stocks-bonds mix that's appropriate, I recommend you use our Asset Allocator tool. I suspect you're a bit of a Nervous Nelly. But remember: if invest too conservatively, you may avoid the risk of seeing your account's value drop occasionally, but you also rise not getting enough growth to provide a comfortable retirement.

Second, once you've set your mix, leave it alone except for occasional rebalancing, by which I mean bringing your portfolio back to its original proportions once a year or so by selling some of the year's winners and plowing the proceeds into some of the year's losers.

There may be times when an investment in your 401(k) performs so badly versus its peers that you decide to jettison it from your portfolio. But aside from those very occasional episodes, just let it be. Resist the urge to tinker (although increasing contributions is always a good idea).

Third, relax. You don't need to check your balance every day. Checking the balance once a month is more than enough. In fact, once a quarter or so is probably about right. So think of some other ways of spending your time rather than obsessing over your 401(k) balance. Read a book, see a movie or play, spend time with your family. Your life will improve and so will your 401(k)'s performance.

Investing advice from Money magazine:

How to get higher investment income now.

3 bargains for uncertain times.

Picks and strategies in Sivy on Stocks.

Walter Updegrave is a senior editor at MONEY Magazine and is the author of "We're Not in Kansas Anymore: Strategies for Retiring Rich in a Totally Changed World."