Accredited investor status opens the doors to a myriad of exclusive investment opportunities. This status is reserved for individuals and entities that meet specific income, net worth, or professional criteria, intended to limit certain higher-risk investments to investors with either the resources or sophistication to bear potential losses.

The requirement for accreditation is particularly relevant when investing in private placements and unregistered securities, as these vehicles do not have the same disclosure requirements as publicly held companies. This rule effectively excludes unaccredited investors from opportunities such as hedge funds, private equity funds, private placements, angel investments, and similar vehicles.

Today, an individual generally qualifies as an accredited investor if they meet at least one of the following:

• Earned income above $200,000 (or $300,000 combined with a spouse or partner) in each of the past two years, with a reasonable expectation of the same in the current year.

• Net worth exceeding $1 million individually or jointly, excluding the value of a primary residence.

• Holding certain professional licenses, such as the Series 7, Series 65, or Series 82.

These thresholds are not automatically adjusted for inflation, which has, over time, broadened the pool of individuals who qualify.

However, the landscape of investment accreditation may soon undergo a significant transformation.

Last year, the House of Representatives passed HR 3339, the “Equal Opportunity for All Investors Act of 2025,” sponsored by Rep. Mike Flood of Nebraska. This legislation is currently assigned to the Senate Committee on Banking, Housing, and Urban Affairs, where it awaits action.

The bill has garnered bipartisan support and backing from regulatory and investment groups, and would require the SEC to develop a certification exam for individuals seeking accredited investor status.

The exam, administered by a national securities association under SEC oversight, would test knowledge of securities types, disclosure requirements, corporate governance, private offering risks, conflicts of interest, and financial statements, to allow financially sophisticated investors to qualify based on competency rather than income or net worth alone.

Offering accreditation (and with it, the ability to invest in private investment ventures) can bring risk. Private offerings can be speculative and illiquid, often locking up capital for years and providing far less transparency than public stocks. Investors with strong financial literacy but limited assets may still lack the resilience to withstand large or permanent losses.

Regulators and industry advocates also worry that expanding access could create new targets for fraud and predatory schemes, especially if marketing outpaces investor education and supervision.

At the same time, the opportunity set in public markets has been shrinking. The number of publicly listed U.S. companies has declined sharply over the past few decades, while private markets have grown in both deal volume and capital raised. In recent years, private deal activity has increased significantly, and many high-growth companies now remain private longer rather than listing early.

Diversified private equity portfolios have historically outperformed public equities over long horizons, and many forecasts project continued excess returns over the next decade, albeit with higher fees, greater dispersion, and less liquidity.

Private equity has become a key channel for accessing high-growth sectors such as technology. Since 2020, a large share of PE deals has targeted tech and tech-enabled businesses, while some high-growth companies have delayed or avoided public listings altogether. For investors restricted to public markets, this can mean reduced exposure to certain segments of the economy.

Historically, top-quartile private equity funds have outperformed public equity benchmarks, but results vary widely across managers and strategies, and fees and fund structure heavily influence net returns.

Many private equity and private-market funds charge substantial management and performance fees, which can materially reduce net returns. These vehicles also restrict investor liquidity, often locking up capital for years. Combined with higher risk, limited disclosure, and complex structures, this means that even sophisticated investors may struggle to assess their exposure fully.

If HR 3339 becomes law, financially savvy but non-wealthy investors could gain access to private markets for the first time, shifting the line between retail and institutional capital and forcing regulators, sponsors, and advisors to rethink how they define suitability and investor protection.

If enacted, the Equal Opportunity for All Investors Act would mark a meaningful shift in how regulators define who may participate in private markets. Adding a knowledge-based pathway to accredited status could broaden access to higher-return but higher-risk opportunities for investors who lack traditional wealth credentials. Whether this change ultimately strengthens or weakens investor outcomes will depend on how effectively the exam is designed, how rigorously intermediaries uphold their responsibilities, and how carefully individual investors assess their own risk tolerance and capacity for loss.