Image Source: Pexels#1 Know Where You’re GoingYogi Berra famously quipped that if you don’t know where you’re going, you might end up somewhere else. The first key to successful investing is to figure out where you are and where you want to go. What is your current situation and what are your financial goals, short and long term?You may find that to reach your retirement goals, for example, your investment strategy should involve less risk. You may be further along financially than you thought.Or you might find the opposite, where you have too much money in very safe, but low-return, investments. That isn’t safe either and could put your financial future at risk.Regardless, you are unlikely to achieve your investment goals if you do not define them first.#2 Investing Instead of SpeculatingIt can seem like the stock market and other financial markets are just a big Wall Street casino. Against all common sense, there are times when very unsound ideas and practices can make a lot of money. However, making good, financially sound decisions and investing accordingly is rewarded over time.In the past several years, we’ve seen speculation in dotcom stocks come crashing down in 2000, speculation in real estate implode in 2008, and more recently, a lot of folks lose money in crypto. Yes, a few folks manage to make speculative investments work—buy low and sell high. But a lot end up doing the opposite, buying high and selling low.The best way to consistently make money, to preserve and protect wealth, isn’t to chase profits or follow fads, but to invest in high quality companies with proven businesses, sound financials, and competent management teams.If you are investing and you own quality companies, bought at reasonable prices, you can usually ride out a downturn and wait for new opportunities to present themselves. But to do this you need to know what “fair value” is for your investments.#3 Include Inflation ProtectionDo you want to bet your financial future on inflation remaining low? If you invest in only stocks and bonds, you may be doing just that.When inflation is high or rising, real assets are likely to be critical to successful investing. Sophisticated investors typically include tangible assets, such as commodities and real estate in their holdings.  Our portfolios include a dynamic mix of real estate, commodities and precious metals for inflation protection and yours probably should too.There is built in inflation protection in real estate via higher rents. In inflationary periods, real estate often outperforms stocks, although that isn’t assured; it’s not that simple. Higher interest rates can negatively affect real estate values. Once rates peak, rising rents are more important.Broad-based commodities also tend to rise during inflationary periods. During periods of rising economic growth and inflation, these investments generally do well. Gold, on the other hand, tends to do well when growth is falling and inflation is rising. That doesn’t happen often, but when it does, gold is one of the few investments that performs well.A mix of real estate, commodities, and precious metals provides inflation protection and when combined with stocks and bonds, increases the odds of investment success, no matter the economic environment.#4 Diversify IntelligentlyThe best way to get rich is to take big risks in concentrated bets. Unfortunately, it’s also a predictable formula for losing everything you have. The best way to stay wealthy, is to do the opposite. Invest prudently and diversify smartly.Athletes, musicians, actors, and entrepreneurs can sometimes bet everything on themselves and strike it rich. Dazzling when it works, but realistically, you have a better chance of getting struck by lightning. In the real world, many people who hit it big go on to fail because they believe it was skill rather than luck.  Wealth that lasts and grows over time is typically diversified and invested prudently.For most people, investing isn’t about getting rich. It’s about preserving and growing your hard-earned dollars. For many, it’s about simply realizing realistic retirement goals.When investing in stocks, we typically use index funds for diversification and individual stocks to get the performance advantages of concentration. One must strike a balance between concentration and diversification.Beyond stocks, too much concentration in gold or cash isn’t safe either. Gold can drop precipitously, even occasionally when inflation is on the rise. Cash accounts seem safe but rarely earns more than inflation takes away.Making big bets on just a few holdings may work out for the lucky. The rest of us need to diversify.#5 Mix Assets TogetherMany DIY (do-it-yourself) investors believe that all the pieces of their portfolio should rise together. Pros know that adding assets with low or negatively correlated returns produces a better result. If one part of their portfolio zigs, they want to own something else that zags. The ideal portfolio consists of assets that rise over time but not at the same time.An investor who expects the economy to grow might sell all their gold since it would be expected to perform poorly. But what if the expectation for growth is wrong? Then gold might perform well and your portfolio would have no exposure. It’s okay to make tactical changes but they shouldn’t be all or nothing. Allow for the possibility that your forecast may be wrong.Bonds, large stocks, small stocks, commodities, gold, and real estate can all perform well in different economic environments. But don’t assume that you can accurately predict the future economic environment. Successful investors keep a mix of assets and don’t make all-or-nothing bets.#6 Think ContrarianBeing a contrarian investor is not as simple as it sounds.  Nor is “following the herd” as safe as it would seem.  Buying tech stocks in 2000, after years of high returns, ended badly. Buying real estate in 2007, when no one thought prices could fall, ended even worse.When an asset becomes “must-own”, it often pays to think contrarian. The same is true when something is so unpopular that no one wants to own it. Investors are better served by a good understanding of human nature than economics or finance. Markets and economies are, after all, made up of people. Humans seek the warmth of the crowd but great investors are loners.Herding behavior creates a cycle where prices rise, value falls, and supply increases. If anything causes demand to fall, prices will rapidly follow. Or the cycle can move in reverse where prices fall, value rises, and supply contracts. Then, anything that increases demand, prices rise rapidly. Great investors recognize both halves of the cycle. Buy low, sell high, rinse, repeat.There are other factors in the decision making process of investing, but if you had to pick a single rule for success, you could do far worse than following the advice of legendary investor Warren Buffet who said, “Be fearful when others are greedy, and greedy when others are fearful.”#7 Have a StrategyCommon sense dictates that it’s hard to get somewhere if you don’t know where you are and where you’re going. Once you’re settled on your destination, you need to chart your course. There may be detours along the way but your GPS will get you back on track. That’s what having a strategy to reach your financial goals provides.This is where you put everything together. You include real assets for inflation protection. You develop a strategic asset allocation mix that can work across different market environments. You diversify intelligently and avoid excessive concentration in a given asset or specific investment.The entire process of investing successfully over time involves analyzing current assets and circumstances, establishing risk tolerance, deciding on goals, developing an asset allocation mix, and diversifying intelligently.  All this, and more, go into formulating, implementing, and maintaining a strategy to achieve your goals. We’re here to guide you on that road to success.More By This Author:Inflationary Dangers Of High Tariffs Inflation Reports Much Ado About NothingMarket Morsels: ISM and Recession