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Investing isn't much fun these days. Gloomy headlines and plummeting portfolio values have even the most unflappable long-term investors questioning their strategies. "Nobody is happy with this market," says Harold Evensky, a certified financial planner (CFP) based in Coral Gables, Fla., who's seen beleaguered new clients stumble through his door either "scared to death" or in a state of utter confusion.

So where's the smart money in this market? Quite frankly, it's not easy to find. The best long-term strategy is stick to your proper asset allocation and not crack under the pressure. But that doesn't mean there's nothing you can do to improve your bottom line in the short term. We spoke with some pros to get their tips on money-making moves for today's environment.

1. Prepay Your Mortgage
Want a guaranteed return? Prepay your mortgage. By adding an extra $50 per month on a $200,000, 30-year fixed-rate loan financed at 7%, you could whack nearly $36,500 in interest payments from the loan, according to HSH Associates, a mortgage-tracking firm.

Granted, these days mortgage debt is cheap. With the 30-year fixed hovering around 6.5% the lowest we've seen in roughly 35 years now's the time to refinance if you haven't already done so. But even with today's low rates, prepaying your mortgage can make sense for those too timid to move cash into the stock market, says CFP Dee Lee of Harvard, Mass. For someone in the 30% federal tax bracket, prepaying a mortgage with a 7% interest rate provides a 5.06% after-tax rate of return. (The rate is lower than the mortgage rate because of the tax break on mortgage interest.) In this market, that's not too shabby.

If you do decide to add a bit extra to your mortgage payment, make sure you won't be penalized for doing so, warns Doug Anderson, president of Key Mortgage in Denver. And don't fall prey to a "biweekly payment program," where you pay your lender or a third party a fee for the right to prepay your mortgage. This is something that you should be able to do free of charge, says Keith Gumbinger, vice president of HSH Associates.

Our worksheet will tell you just how much you can save by prepaying. But keep in mind that, over the long-term, investing in the stock market will almost surely yield better results than prepaying your mortgage. So while this is a fine move for investors uncomfortable with the market's volatility, it should be a temporary salve rather than a permanent solution.

2. Laid Off? Won't Get Your Bonus? Open a Roth
For most investors, contributing to a Roth IRA rather than a tax-deductible (or nondeductible) IRA will yield significantly more retirement dollars. That's because the Roth offers tax-free retirement savings, while the other two are tax deferred. (With a deductible IRA, original contributions as well as earnings will be taxed as ordinary income; with a nondeductible IRA, only earnings will be taxed.)

So why doesn't everyone open a Roth? Two words: income limits. For single investors, eligibility phases out for those with adjusted gross income (AGI) of between $95,000 and $110,000. Married investors filing jointly are phased out if they have AGIs of $150,000 to $160,000. And to convert a deductible or nondeductible IRA to a Roth requires an AGI of $100,000 or less, regardless of your romantic status. A Roth conversion also comes with another hurdle: You have to pay taxes on the accumulated earnings and pretax contributions.

But thanks to the steady flow of layoffs, pay cuts and the reduction (or elimination) of what used to be juicy bonuses, "a lot more people are going to qualify for the Roth," says Evensky. Better yet, if your traditional IRA account balance is down significantly, you'll pay less in taxes on a Roth conversion, says CFP Lee. Converting to a Roth generally makes sense for investors under age 50, Lee says, or for older investors who don't plan to drain the account anytime soon. (The Roth can be a handy estate-planning tool

Granted, the opportunity to open a Roth IRA may seem like cheap silver lining. But trust us, it will pay off further down the road. Consider that a 30-year-old making maximum contributions would, at age 59 1/2, have roughly $492,000 in a Roth compared with $383,000 in a nondeductible IRA, should the account earn 8% annually. (This is assuming he'd be in the 27% tax bracket during retirement; the results would be even more dramatic should he be in a higher tax bracket.) To see which IRA is best, read our story.

3. Slash Your Debt
Carrying credit-card debt is never smart. But it's particularly dumb when the economy is on shaky ground. So if you have high-interest credit-card debt (and 60% of credit-card users carry a balance, according to CardWeb.com) then by all means, pay those suckers off. "There are no guarantees in the stock market, but the interest rates on your credit cards are a sure thing," says Mike Kidwell, cofounder of Myvesta.org, an online debt-management service.

One quick and easy way to reduce your debt is to call up your lender and demand a lower rate. Remarkably, this simple gesture is actually quite effective: More than 55% of cardholders were able to reduce their APRs by more than one-third with a mere phone call, according to a recent study by the Massachusetts Public Interest Research Group.

Alternatively, you could consider consolidating your debt with a home equity loan (HEL) or a home equity line of credit (HELOC). Right now the average rate on a $10,000 HEL (always a fixed rate) is 7.49%, while a $10,000 HELOC (always a variable rate) is just 4.76%, according to Bankrate.com. And that's before you factor in the tax break on the interest. So if you're in, say, the 27% tax bracket, the after-tax yield of a 4.76% HELOC would be a mere 3.47%. The trade-off, of course, is that you're putting your home up as collateral. If you're a chronic overspender, this could leave you significantly worse off than you started. "You have to get some discipline," says Key Mortgage's Anderson. "It has to be a life change for people."

For more on consolidating debt, see our story.

4. Consider TIPS
If the past couple of years have taught us anything, it's the value of diversification. Investors heading into this bear market with a helping of bonds have held up significantly better than those who had ignored this asset class.

Of course, with interest rates having little place to go other than up, investing in bonds these days is a tricky proposition. Then again, with money-market funds and other cash equivalents offering paltry returns, money earmarked for fixed-income shouldn't be left sitting on the sidelines indefinitely. One option worth considering is treasury inflation protected securities, or TIPS. Like any bond, TIPS could suffer should interest rates rise. But at least they won't succumb to the other ravager of long-term bond performance, inflation. These notes, issued by the government, offer a fixed interest rate (an auction earlier this month offered a 3.000% interest rate for a 10-year note), but unlike standard Treasurys, the principal is adjusted to reflect inflation. So during a year in which inflation hovers around 2%, your principal would be adjusted upward by that amount, giving you additional return. TIPS can also be a useful way to diversify a portfolio, since they have no correlation to stocks or corporate bonds.

This doesn't mean they're risk-free, mind you: Should we enter a deflationary period, TIPS will underperform standard Treasurys. But for long-term investors looking for a fixed-income fix, "it's one of the single best investments out there," says Evensky.

You can buy individual TIPS or invest in mutual fund that holds them, such as the Vanguard Inflation-Protected Securities. It's important to note, however, that TIPS are not tax efficient, as both the interest payments and the principal inflation adjustments will be taxed as ordinary income. For that reason, they're best held in a tax-advantaged retirement account.

For more tips on TIPS, see our story.

5. Invest in Your Home
OK, taking on that remodeling project you've dreamed about for years probably isn't going to give you a great return on your investment. But you're likely to recoup at least some of the costs, and, hey, you get to enjoy the finished product. That's worth something.

Which renovations pay off? The answer depends on where you live, the value of the homes in your neighborhood, when you plan to sell and the nature of the renovation itself, explains Jim Cory, senior editor of Remodeling magazine. The national average cost recouped for minor kitchen remodeling, for example, is 87%, according to Remodeling magazine's latest survey. In hot housing markets, however, like Boston, that renovation is likely to recoup 110% of its costs. But keep in mind that the longer you plan to hold onto the house after the renovation, the less likely it is to increase your home's value.

Also, there's little reward for those who try to make their houses the best on the block, warns CFP Lee. That's because the most expensive home in a neighborhood could be perceived as overpriced. And if you're looking to recover as much of your cost as possible, make sure you go with a classic design, says Cory. When it comes to remodeling, beauty is indeed in the eye of the beholder. So an investment in, say, a shagadelic retro 1970s den could prove nearly as worthless as an Internet-stock mutual fund circa 2002.