Foley Equipped
Insights

What is an accredited investor?

An accredited investor is an individual or entity that meets certain wealth, income, or asset thresholds or holds specific professional certifications, as defined under Regulation D of the Securities Act of 1933. These qualifications are meant to ensure that investors have sufficient knowledge or wealth to evaluate and bear the risks associated with unregistered securities offerings. The Securities and Exchange Commission (SEC) periodically updates these requirements to reflect changing market conditions.

Under Rule 501 of Regulation D, individuals generally qualify as accredited investors if they meet any of the following:

  1. Net Worth: a person whose net worth, alone or with a spouse or spousal equivalent, exceeds $1 million at the time of the purchase, excluding the value of their primary residence.
  2. Income: a person whose income exceeds $200,000 individually or $300,000 with a spouse or spousal equivalent in each of the two most recent years, with a reasonable expectation of the same income level in the current year.
  3. Executive Role: a director, executive officer, or general partner of the company offering the securities.
  4. Professional Certifications: a person who holds certain professional certifications, designations, or credentials recognized by the SEC. To qualify, the certifications must be in good standing and issued by an accredited institution recognized by the SEC.
  5. Family Office: certain persons who are a “family client” of certain family offices with over $5 million in assets under management.
  6. Knowledgeable Employees: certain employees of private investment funds that are involved in the fund’s investment activities.

In certain circumstances, entities such as businesses or charitable organizations can also qualify as accredited investors. Generally, to qualify, the entity must either have $5 million or more in assets or be made up entirely of accredited investors.

For more detailed and up-to-date information on accredited investor requirements, consult Rule 501 of Regulation D on the SEC’s website.

Subscribe to our newsletter
Subscribe

© 2025 Foley & Lardner LLP
Attorney Advertisement
Images of people may not be Foley personnel.

This blog is made available by Foley & Lardner LLP (“Foley” or “the Firm”) for informational purposes only. It is not meant to convey the Firm’s legal position on behalf of any client, nor is it intended to convey specific legal advice. Any opinions expressed in this article do not necessarily reflect the views of Foley & Lardner LLP, its partners, or its clients. Accordingly, do not act upon this information without seeking counsel from a licensed attorney. This blog is not intended to create, and receipt of it does not constitute, an attorney-client relationship. Communicating with Foley through this website by email, blog post, or otherwise, does not create an attorney-client relationship for any legal matter. Therefore, any communication or material you transmit to Foley through this blog, whether by email, blog post or any other manner, will not be treated as confidential or proprietary. The information on this blog is published “AS IS” and is not guaranteed to be complete, accurate, and or up-to-date. Foley makes no representations or warranties of any kind, express or implied, as to the operation or content of the site. Foley expressly disclaims all other guarantees, warranties, conditions and representations of any kind, either express or implied, whether arising under any statute, law, commercial use or otherwise, including implied warranties of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Foley or any of its partners, officers, employees, agents or affiliates be liable, directly or indirectly, under any theory of law (contract, tort, negligence or otherwise), to you or anyone else, for any claims, losses or damages, direct, indirect special, incidental, punitive or consequential, resulting from or occasioned by the creation, use of or reliance on this site (including information and other content) or any third party websites or the information, resources or material accessed through any such websites. In some jurisdictions, the contents of this blog may be considered Attorney Advertising. If applicable, please note that prior results do not guarantee a similar outcome.