He is like a tree planted by streams of water that yields its fruit in its season, and its leaf does not wither. In all that he does, he prospers. (ESV)
The Psalmist continues in his description of the "blessed man." He spoke in the first verse of the things that a blessed man avoids (wicked, sinners, scoffers). In the second verse the blessed man is described as one who delights in the Law of the Lord and meditates on that Law day and night. In this third verse he uses an illustration from nature to describe the blessed man.
The Psalmist refers to the blessed man as a tree planted by streams of water. We must consider why this particular illustration from nature was chosen. Dr. John MacArthur writes, "Because of the mostly arid terrain of Israel, a lush tree served as a fitting symbol of blessing in the OT (John MacArthur, Online Study Bible Notes)." A strong, beautiful tree, bearing fruit, and prospering is how a blessed man is described.
The next questions might be, "How did that tree get there?" It was planted. If we want to consider our illustration in terms of a person having godly contentment and living a life of righteousness we need to realize that we are not born that way. God is the one who plants us in the life giving water of His Word which bears fruit in us.
This last phrase says that "in all that he does, he prospers." This is a generalization commonly found in this kind of Old Testament literature. It does not mean that there is never a single moment when a blessed man steps our of God's will or encounters failure in any way. However, it is suggesting that a blessed life will generally demonstrate prosperity. That prosperity will not necessarily be material, but most certainly will be spiritual.
Where are you planted? Do you feel that the water of God's Word is nourishing you? Are you demonstrating the fruit of the Spirit? Do you prosper? Look to God for His blessing.
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