Both of the following are necessary, but how are dreaming and realism balanced?
Good question. A quote comes to mind that I may get slightly wrong - "dreams are free, so dream big". I subscribe to this thinking and refuse to settle for what others directly or indirectly suggest I should be.
There are too many examples of people in our lifetimes that succeed at their goals against great odds. Naturally there is a reality those dreams/goals need to be seated in; it isn't realistic to want to be an all-star basketballer if your already in your 90's with arthritis.
I have found that most people have dreams that are realistic. They may be a massive stretch or have a long path, but really the only thing between today and those dreams are themselves.