Raise or Fold?

[Kirkrrr]

Hey everyone. Came upon a somewhat interesting situation and would appreciate any and all opinions you might post (actually, I'm pretty sure I grossly misplayed my hand but I would like confirmation).
I will try to reconstruct from memory best I can. Playing .02/.04 NL on stars.com. I'm on the button with AJo, everyone folds except CO who raises to .04, I call, SM folds, BB checks. (pot: $.13)

Flop: 8 /images/graemlins/club.gif, 2 /images/graemlins/spade.gif, K /images/graemlins/diamond.gif.

CO raises it $.60, I call partially thinking he might be bluffing as he's done it before, partially thinking I might hit my Ace. BB folds.
Turn brings A /images/graemlins/heart.gif. CO bets $.30, I go all in for a $1 or so, he calls.

Result (white):
<font color="white"> </font> River: 6 /images/graemlins/club.gif

CO hand: K /images/graemlins/diamond.gif, 2 /images/graemlins/heart.gif
<font color="black"> </font>
Having had time to think about it, it's even more obvious I misplayed my hand, but I'd still like any additional insight anyone would care to share.

Thanks,
Kirk R.

[SomethingClever]

I would have re-raised preflop to about $0.15 or so.

Then I'd fold to the $0.60 bet on the flop, although if I had been first to act, I would have bet the pot.

You simply can't call a bet that is 4 times the size of the pot with just one overcard, even if you think the other guy is bluffing.

In general, think bet, raise or fold. Don't just call very often.