Lord of the (Wedding) Rings
by Efren Ll. Cruz, RFP
Question: I already want to invest our hard-earned savings in stocks so that we can make more money and perhaps retire early. But my wife is so conservative and afraid of the potential loss. She just wants our money placed in guaranteed short-term investments. Do you know of a way for me to convince her to see it my way? – Sent via “Ask a friend, Ask Efren” service on www.personalfinance.ph
Answer: You and your wife are obviously worlds apart in terms of your preference for risk-taking. Don’t worry, be happy…this is the type of combination that will make for a better managed investment portfolio.

But first things first, there is no “my way or the highway.” There is only “our way.” Unlike in the movie, there is no lord of the wedding rings in a marriage. The ideal marriage is where husband and wife form a collegial body in crafting monetary policies that impact the entire family. After such policies have been laid out, either husband or wife is appointed to serve the family through the execution of the relevant strategies.
I agree that it is not as easy as it sounds. Just like in the movie, a diminutive hobbit had to go against all the might of a dark lord. But conquer the dark lord he did through patience, persistence and perseverance, otherwise known as the power of three. And that power of three is what successful couples use to conquer their daily financial challenges.
Undoubtedly, you see your wife’s risk aversion as being a drag to making more money and possibly retiring early. On the other hand, she probably sees you like a kid running with a pair a scissors. Even if both of you are looking at just one thing, you can very well interpret it differently. In this regard, both of you have to see the pros and cons of your respective risk preferences.

Please consider that your wife is like many other people who simply do not like to experience losses. Losses generally hurt more than gains please according to the book, “Why Smart People Make Big Money Mistakes and How to Correct Them” by Gary Belsky and Thomas Gilovich. Moreover, people tend to see losses independent of their overall impact on wealth.
I was on a provincial training trip recently where my client would reimburse my out of pocket expenses. In my rush to catch the plane back to Manila, I forgot to ask for a receipt from the taxi I took to the airport and, therefore passed up on the opportunity to have the taxi fare reimbursed. The amount was just Php200, a measly sum compared to the fee I would earn. Yet it took me a while to get over that Php200. I even found myself thinking of the many items I could have bought with Php200. On the other hand, I bet that if someone suddenly gave me Php200, I would not fuss over it that much.
Combine this aversion to loss with confirmation bias. It would be so easy for anyone to cite the legions of investors who lost a lot of money in the stock market even though there could be just as many or perhaps more who also profited from it. This confirmation bias is so strong that it can hold people back or cause them to stay put due to the status quo.

On the other hand, you too can suffer from overconfidence when you get carried away with stock investing especially if your first few trades turn out to be winners. You could also very well be selective in confirming your brilliance in stock investing by taking things out of context. For example, making money in a bull run, such as what our stock market had over the past several years, does not make one brilliant as most everything was moving up in price. If you were like Jesse Livermore who made USD100 million during the 1929 stock market crash, or grew your wealth by the multiples like Warrant Buffet, then you would be considered brilliant.
Your wife’s risk aversion will help put your feet back on the ground and be prudent with the way you invest your family funds.
There are two ways to combat aversion to loss, overconfidence, and confirmation bias. First, frame rules on how to prudently manage your money, perhaps with the help of an expert. Second, invest periodically but only in bite sizes. This will prevent you and your wife from being overwhelmed either by the potential risks or gains.
Do not fight over who should be the lord of the wedding rings. Instead, try to see how your different views can complement each other.
If you want to learn more about personal finance for couples, you can check out the column For Richer Or Poorer on Inspirations.ph every Friday (publication date may change without prior notice). You can also visit www.personalfinance.ph for more free resources or send questions directly to yaman@personalfinance.ph.
✢
Efren Ll. Cruz is a Registered Financial Planner and Director of RFP® Philippines, seasoned investment adviser, bestselling author of personal finance books in the Philippines and a YAMAN Coach™. He also writes for the Philippine Daily Inquirer’s Money Matters column HERE.
Copyright 2025 Efren Ll. Cruz, RFP®. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without the prior written consent of the author.