Looking for the silver lining is healthy, but ignoring reality is self-destructive. Unfortunately, some people confuse healthy optimism with denial. Their overly optimistic outlook leaves them unprepared for life's inevitable challenges.

So while it's good to be optimistic-studies consistently link optimism to everything from improved health to increased income-it's important to also be realistic. Here are five ways to be an optimist, without being a fool:

1. Expect Success, But Don't Expect it To Come Easily

Don't allow your optimistic expectations to prevent you from working hard. Whether you're starting a new business, or you're facing your biggest competitor on the sports field, overconfidence can prevent you from putting in the effort you need to succeed.

So while envisioning success can help you achieve it, don't anticipate rising to the top without a struggle. Your thoughts greatly influence your behavior, so instead of thinking, "This will be a piece of cake!" remind yourself why you need to work hard. When you put in more effort, you'll be more likely to achieve your goals.

2. Don't Allow Your Desire to See the Good Blind You to the Truth

Healthy optimism doesn't idealize the truth, especially when it comes to other people. Overlooking the fact that someone lies, cheats, or steals, just because he's a nice person, won't do anyone any favors. Trusting an untrustworthy person or becoming victimized by a master manipulator will leave you looking like a fool.

Acknowledging that someone makes poor choices, has a bad attitude, or treats others poorly doesn't make you a pessimist-it may simply mean you're a realist. While it's nice to see the good in someone, it's equally important to recognize character flaws. Everyone has both good and bad qualities and be open to seeing the whole picture.

3. Acknowledge Your Strengths, But Don't Overestimate Your Abilities

While a healthy sense of self should include complimentary self-appraisal, a superiority complex could sabotage your efforts. If you're optimism has crossed the line into arrogance, you'll become more invested in showing off your skills, rather than sharpening them.

No matter how good you may be, there's always room for improvement. Even if you think you're a stellar presenter, an expert salesperson, or a natural leader, keep working to get better. Keep noticing your strengths, while also acknowledging room for growth.

4. Don't Confuse Positive Thinking with Magical Thinking

There's a distinct difference between optimistic thinking and magical thinking. Yet, many people say things like, "Just think positively about that job application you filled out and things will work out," as if your positive thoughts will magically make your phone ring.

While positive thoughts can become a self-fulfilling prophecy-thoughts alone don't change the course of the universe. Thinking, "I can do this," only works when it influences you to behave in a way that improves your chances of success. You need to combine positive thoughts with positive action if you want to get positive results.

5. Believe in Plan A, While Also Creating a Plan B

Overly optimistic people sometimes say things like, "I just know things will work out!" Their excitement over an opportunity can cause them to underestimate the risk involved. And in an effort to stay loyal to their optimistic outlook, they refuse to consider what will happen if plan A doesn't work.

While it's good to be hopeful that your first attempt will be successful, it's wise to have a backup plan. No matter how much hope you hold out that everything will go smoothly, prepare yourself to deal the worst case scenario. Rather than insisting things go according to plan, stay optimistic about your ability to deal with the fallout if things don't work out the first time.

Practice Realistic Optimism

Your inner monologue plays a major role in how you feel and how you behave. Just like being overly negative isn't healthy, looking at the world through rose-colored glasses can be detrimental if it leaves you ill-equipped and unprepared for the realities of life. Healthy levels of optimism stop short of clouding your judgement.

Train your brain to be a realistic optimist. Maintain a positive outlook, while simultaneously acknowledging the reality of the situation, and you'll increase the chances that you'll perform at your peak.