In order to become an accredited investor, you must meet certain income or net worth requirements outlined by the SEC (Securities and Exchange Commission). You must also demonstrate to investment firms that you can qualify to invest in certain products.
To become an accredited investor, you must be able to show earnings above $250,000 ($300,000 if combined with a spouse) during the last two years, or have a net worth exceeding $1 million on your own or with a spouse (excluding the value of your current residence). Any entity selling unregistered securities is responsible for screening potential investors to determine if they fit the necessary criteria. Lastly, one must prove they can maintain this level of income for the current calendar year.
Becoming an accredited investor unlocks a whole new level of options to grow your money, if done wisely. Some advantages available to accredited investors include:
The ability to invest in unregistered securities not available to the general public.
Approx 5% of the public typically achieve this level of access.
The ability to invest in hedge funds.
Opportunity to benefit from higher rates of return
Method of diversification; not necessarily tied to the stock market
Opportunity to invest in much larger properties
Ability to invest in a larger number of asset classes
More geographic diversification
Typically lower borrowing costs
Typically a higher yield, especially in commercial real estate
With the proper due diligence, network & opportunities; becoming an accredited investor can be a lucrative way to grow your overall net worth rapidly. It really is as simple as monitoring sustained rates of return for the exclusive aforementioned investment vehicles, and then comparing that against your current interest gains. To further illustrate, a 12% return, which isn’t uncommon within well-run commercial real estate offerings, doubles the initial investment in just 6 years.
Click here to learn more about high-performing commercial real estate offerings from Prospera.