Legacy Group Capital

How to get Verified as an Accredited Investor

Many investment opportunities are reserved for accredited investors who meet specific financial criteria. Understanding your accreditation status can offer you a wealth of valuable benefits and opportunities.

What are the Requirements of an Accredited Investor?

Individuals can qualify as accredited investors based on wealth and income thresholds or other indicators of financial sophistication. Accredited investors meet one of the following criteria:

  • Net worth of at least $1 million, excluding primary residence, either individually or combined with spouse
  • Earned an income of at least $200,000 individually, or $300,000 with spouse, in each of the last two years, and expected to earn the same in the current year
  • Demonstrate other measures of financial knowledge, such as holding certain professional licenses, being directors, executive officers, or general partners of the issuing company or being a “knowledgeable employee” of a private fund

How do I get Verified as an Accredited Investor?

You can verify your status through various methods, each of which involves providing specific documentation:

  • Professional license certification: Provide documentation verifying professional licenses, such as FINRA licensure verification for investment professionals.
  • Third-party attestation letters: Obtain letters from qualified third parties confirming your accredited investor status based on specified criteria.
  • Employment verification letters: Present letters from employers verifying your position and income level to meet accreditation thresholds.
  • Consumer credit reports: Submit consumer credit reports detailing your financial history, which can contribute to demonstrating your financial health and stability.

The following documents can help to prove your income, net worth, and overall financial health, ensuring you meet the necessary criteria:

  • Tax returns
  • IRS forms
  • Credit report
  • Brokerage statements

Block Quote: Did you know, the number of “accredited” investors grew to 24 million in 2022, adding 8 million compared to the prior year, and this increase doesn’t look to be stopping any time soon, according to the latest number crunch from the SEC

Why do I need to be an Accredited Investor?

Being an accredited investor is beneficial because it provides access to a broader range of high-reward investment opportunities that are not available to the general public, such as private placements, hedge funds, and venture capital. The criteria set forth by the SEC for accredited investor rules, established under Regulation D of the Securities Act of 1933, is designed to protect investors with limited financial knowledge.

What are the Benefits of Being a Verified Accredited Investor?

  • Invest in Startups: You can invest in venture capital funds and source private offerings.
  • Opportunities for Higher-yield Investments: Security investments have more potential for higher yields, making them a popular investment vehicle for your investing.
  • Portfolio Diversification: Investing outside public markets allows you to protect your assets from rising interest rates and other factors that affect public securities.

Get In Touch!

If you are an accredited investor looking to invest in top-performing real estate markets, contact our investment team to get started today.

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