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Here are Four Ways to Become an Accredited Investor - YouTube
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- Hi guys, Pia Washington here,
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and today we're going to discuss
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four ways to become an
accredited investor.
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One of the most frequently asked questions
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that my team of financial
advisors and I get
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is how to become an accredited investor?
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Well, in this video,
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I'm going to share with you the four ways
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to become an accredited investor
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in order to take advantage
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of various passive
investment opportunities
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like real estate syndications.
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Now, a real estate syndication
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is simply a pooling of capital
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between a sponsoring company
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and multiple investors
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to invest in various forms of real estate.
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It's considered to be
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a type of private placement,
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which allows the company to raise money
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without having to go public.
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Private placements are not registered
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with the Securities and
Exchange Commission,
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however, they are highly
regulated by the SEC,
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just under different rules,
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collectively known as Regulation D
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or Reg D for short.
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Now, these investments are very popular
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for people or investors
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who want the tax advantages
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of real estate investing
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without all the headaches
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of being a hands-on landlord.
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Also with limited financial exposure,
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you may be able to invest in a syndication
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with as little as $10,000
or $100,000 investment.
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So here they are,
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the four ways to qualify
as the natural person
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or as a business entity.
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Number one, you must have earned income
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that exceeded $200,000 as a single person
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or $300,000 as a married couple
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in the two years prior
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and reasonably expect the same
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for the current year.
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So if you're investing this year, 2021,
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that would mean for 2019, 2020,
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and you would expect the same income
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or more for 2021.
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Or, the second way, number two,
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is to have a net worth over $1 million
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as a single or a couple,
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but this is excluding the value
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of your primary residence,
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so you can not include
the value of your home.
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Or number three, you can hold
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one of the following securities license,
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a Series 7, which
basically establishes you
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as a holder, as a financial professional,
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to be able to sell securities,
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a Series 65 is a professional license
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that allows you to give investment advice,
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or a Series 82,
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which essentially would measure
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whether or not you have enough knowledge
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to solicit and/or sale
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private placement security products
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as a part of a primary offering.
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Or number four, you can
qualify with an entity.
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So the business entity or trust
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must have a total assets
of $5 million or more,
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and can not have been specifically formed
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with the purpose of
buying said securities,
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or all of the equity owners of said entity
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must already be accredited investors.
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Now, once you qualify as
an accredited investor,
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you're ready to invest,
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you'll be asked to have to verify
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your status as an accredited investor.
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And as a potential investor,
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be prepared to have to respond
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to various questionnaires
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and submit a lot of financial documents
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in order to sustain
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and verify your qualification.
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You will be asked for things such as
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account information, financial statements,
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maybe tax returns, or W2s, credit reports.
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Also, letters of review
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from either your CPA or tax attorney.
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Some syndications will allow you
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to complete verification online
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through various online
verification services,
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such as verifyinvestor.com.
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Now, one of the key benefits
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of our Infinity Investing
360 Pro membership
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is having access to various syndications
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and private placements.
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But you do have to be
an accredited investor
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in order to participate.
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And in the event that
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any of the offerings
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are 506(b) offerings are made,
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not only must you be accredited,
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but you must attend one of our live events
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like our cashflow summit event
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that's held in Indianapolis.
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Because one of the requirements
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of rule 506(b) of Reg
D states that companies
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conducting an offering under this rule
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can raise an unlimited amount of money
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and can sell an unlimited
amount of securities
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to an unlimited number
of accredited investors,
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but there can be no general solicitation
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or advertising to market the securities.
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So in other words, they
must be personally known.
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So what better way to ensure that
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you're personally known
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than to attend one of the live
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and in-person events to
get to know the team.
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So in summary,
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the four ways in which you can gain
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your accredited investor status are
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by number one,
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meeting the earned income requirement
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of $200,000 as a single
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or $300,000 as a couple
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in each of the two years prior,
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and expect the same for the current year.
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Or, number two,
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meeting the net worth requirement
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of having a net worth of over $1 million,
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not including your primary residence.
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Or, number three,
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having one of the various
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financial securities professional licenses
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in good standing.
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Or, number four,
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by owning a qualifying entity
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that has total assets
in excess of 5 million
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or all the equity owners
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are accredited investors.
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For more information
on financial planning,
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stock and real estate investing,
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please like and subscribe below.
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Thanks for watching,
and make it a great day.
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