You must become an accredited investor

Next level investing

There are some fundamental reasons you should work towards becoming an accredited investor. The main benefits are the following:

  1. Access to more Investments options that may have higher yields and lower minimums
  2. Hedge funds, real estate syndication’s, crowdfunding, angel investing/ VC
  3. Diversification outside of public markets
  4. Better networking opportunities with high net worth investors

The requirements are pretty straight forward:

Have a net worth of at least 1 million dollars not including your primary residence OR
Have an annual income of at least 200K individually or 300K for married couples for the past two years.
*Individuals and entities (banks, trusts, companies) can be accredited, investors.

Once you meet the requirements, have your CPA or wealth adviser draft a letter confirming your accredited status. Note-these letters are good for 90 days. You could also use this website to prove your status.

Now for the most critical paragraph you will read. All deals carry risk and you should proceed with extreme caution. Share your due diligence with your CPA or wealth manager before wiring money. Be sure to get some additional training on reading the prospectus/terms.

A few things to ask yourself before pulling the trigger.
Should I run this investment through a corporation or retirement account (IRA or solo)
What is the projected IRR and cash on cash yield?
What is the lock-up period?
Most importantly, what is the sponsor or group’s experience? Can this group execute, return your capital, and deliver the projected return?

Here are two excellent resources as you study accredited investors.
SEC- Accredited Investor- Updated bulletin
Investopedia- great article and video explaining accredited investors


Utah Millionaire

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