UNACCREDITED CROWDFUNDING INVESTING
All investors would jump at the opportunity to become accredited investors, but the title doesn’t just fall on your lap. For starters, it takes an individual earning an annual income in the $200,000 range to qualify as an accredited investor. Having a net worth beyond $1 million or being a highly ranked officer in the issuer office are just more expensive alternatives. However, its not all doom and gloom if you don’t qualify for accredited crowdfunding investing, you have the option of unaccredited crowdfunding investing.
UNACCREDITED INVESTING- A VIABLE PLAN B
The current title III regulations allow unaccredited crowdfunding investing, but of course with a few clauses here and there. These clauses include a restriction on how much non-accredited investors can invest annually, including crowdfunding real estate projects. If you have a handsome net worth personally, your limits will vary, but not as much as an accredited investor. They have no restrictions at all. More info about the restriction will be found on this Investopedia blog.
Individual limits for particular net worth
If you make well below $100,000 or have your net worth nestling somewhere below the sum annually, you can only invest a sum just about $2,000 or the lesser of 5% of your income or net worth. Now, if you make an annual income above $100,000 or have a net worth that is well above the figure, you are at liberty to invest up to 10% of your income or net worth into real estate or whatever crowdfunding project you are interested in. Proof about the investment limitations are found in the report by Equity Blender here.
The restrictions were put in place to protect unaccredited crowdfunding investors who mostly have little knowledge of what they are doing. This way, you don’t have to risk so much money at your stage of ignorance. So, if a crowdfunding investment fails, you can dust yourself off from the controlled fall.
Unaccredited crowdfunding investors should keep in mind that even though the Title III now allows universal participation, not every crowdfunding platform would be keen about this.
“Guide to Crowdfunded Investments for Non-Accredited Investors”.
“Investment Limitations”. Equity Bender. 2017