Issue #25: Are you Accredited?

We did it we crossed 1,500!!! Currently sit at 1,524. As we continue to grow and continue to be Loud, will always appreciate you for taking 5-10min of your day to read what I have to say, thank you!

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Accredited Investor Rule: What is it? Why is it? Whom is it for?

I first want to start with I think the rule as a whole is shit and my clip of the week highlights this. That being said there is a reason for the rule and that it can be used to provide guardrails. Let me explain…I promise to not go super legalize!

The rule itself is summed up as this, you must make $200k+ (individual) or $300k+ (jointly) for a 2 year average or have a net-worth north of $1 million which does not include your primary residence…. which is where most people have equity I might add.

Here is the full list of other ways to qualify: (yes this is the government website, it comes through like this…it’s a real link)

Now that we disqualified probably 95% of you, where does that leave us? And that IS MY POINT, the rule is designed to protect people from losing all of their money or potentially not having the knowledge to understand what they are getting themselves into. Yet, it is making a decision for 95% of the population, I can promise you that I know many people who are not accredited that are intelligent enough to understand what they are getting involved with and understand the potential loss of capital that may occur. So, you “SEC” are telling this person they are not worthy enough to invest into certain Alternatives because you deemed it too “risky” for them based off an arbitrary $$$?!

Yet it is okay for everyone to go ahead and invest in the stock market, almost any stock they want, regardless of what it is. For example, the whole meme stock era of Gamestop and AMC theatres, stocks running 100s of percentages…that was fueled by retail (everyday people) investors whom most were not accredited. The institutions (banks, brokerages, hedge funds, etc.) were able to run it higher, sell for huge gains and guess who got left holding the bag? YEP…the “non-accredited” investor…so you tell me if that is less risky than being able to go buy a commercial property with a handful of other investors?

What Changes are Coming? How can I get around the rule?

Okay fine I am off my rant but it rings true, “Alternative investments” that for some reason are deemed “riskier” are not always riskier, there are a lot out there that are similar in risk or even safer way safer than the S&P 500 or a random ass stock you pick. But the powers at be will let you lose all your money in the market, because it benefits them, when you go to “private” investments it doesn’t and then they have no “control”.

I say this as lawmakers are even getting upset with the SEC about this as well see below. This article was published on 2/8/2023

As you can read there...things are going to change eventually but how long will it take? I have no clue.

So what can you do now? Well first, go find a planner who has access to Alternative investments, yes there are plenty out there for you that even as a “non-accredited investor” you can be apart of. A firm I support wholeheartedly that is attacking this issue from all angles is Banrion Capital Management stay tuned for podcast with their Founder Shana Orcyzk Sissel, to come out on 3/15/23 and the youtube show to come out on 3/19/23. Here we dive into this situation and ways you can improve your overall investment portfolio to include 20% into alternatives!

To summarize todays rant/education…the current Accredited Investor rule is SHIT and does not allow 95% of people to truly start building their wealth. Now my solution to this madness is to shape the guardrails better, can/should their be an educational qualification to this YES, should the income and net-worth parameters be lowered YES, do disclosures need to be highlighted more from private placements YES…sounds simple, technically it is but I am no attorney and I am sure there will be a year or more battle to get this dealt with but it needs to happen! In order for me to do my job of building your wealth, I need to be able to use all tools at my disposal and sadly if you don’t make $200k single, $300k joint and have $1million net-worth outside of your primary home…I am limited and that IS NOT OKAY!!!

#NoBSWealth Clip of The Week

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#Goonsquad Clip of The Week

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