And if you put your money in labour union venture capital funds, every five dollars invested get you almost four dollars back in tax credits. It looks good on the Quicken balance sheet, but there are problems. The problem with RRSPs is that to get the tax break, Canadians are limited to investing 20 percent of their money in foreign assets. Most people sense that limiting where you can put your money also limits your returns. What is less obvious is that limits on where you can put your money also limit a person's ability to manage risks.
Financial markets are insurance markets.
You park your money in a diversified portfolio to cover your backside from the downside. This is the fundamental principle of insurance. In an economy some people will do well, and others poorly, for reasons beyond their control and their abilities to predict. Everyone breathes easier by pooling their incomes and spreading the risks. The financial market is an income pool where you invest in companies whose profits come from parts of the world other than your own.