BusinessHABAccredited Private Business Investor: In Nigeria, trade in securities is regulated by the Securities and Exchange Commission.
Riskier investments, such as new-company start-ups.
Typically are limited to accredited investors.
However, this term is misleading.
There is no agency to accredit you, nor do you have to pass any tests.
You simply must have income and assets above the threshold established by the SEC rules.
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Accredited Private Business Investor
1. Total your annual income for the past two years.
If you have made over $200,000 in each of the past two years.
You may be eligible to become an accredited investor.
You also must certify that you will make at least that much in the next year.
- If you are married and you and your spouse want to invest as a couple, you must have a combined income of at least $300,000 a year.
- This method of becoming an accredited investor is the easiest.
- However, since IRS tax documents are used to verify income.
- This method may not be available for anyone who is not a Nigerian taxpayer.
- Companies issuing stock have the option of using foreign tax returns provided the country imposes penalties similar to those in the US if you report false information.
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Accredited Private Business Investor
2. Add up the value of your assets for net worth qualification.
However, if you own vacation homes or other real property, those do count.
- Other assets include vehicles, bank accounts.
- Retirement accounts, and any other investments you have.
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Accredited Private Business Investor
3. Subtract the amount of your liabilities.
Mortgages on real property also are considered liabilities.
- If you have a mortgage on your primary residence.
- It generally is not included as a liability since you can’t include the value of that property as an asset. However, a portion of it may be subtracted from your net worth as a liability if you owe more than the fair market value of your home.
- Or if you’ve recently taken out a home equity line of credit.
4. Arrive at your net worth.
For purposes of becoming an accredited investor.
Your net worth is the total value of your assets minus the total amount of your liabilities.
To qualify as an accredited investor, this amount must be more than $1 million.
- If you’re close to the threshold and still want to become an accredited investor.
- Talk to an attorney who specializes in security law to learn more about your options.
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5. Take exchange rates into account.
The SEC’s rules require that accredited investors meet certain threshold income or net worth requirements expressed in US dollars.
If you live outside the US, you’ll need to double-check your figures.
- Companies that verify your information have the option of using the exchange rate for the last day of the year the income is being determined, or the average rate for that year.
- To be on the safe side, make sure you qualify using both of those rates.
Accredited Private Business Investor
6. Get copies of the past two years’ tax returns.
While there is no required process to become an accredited investor.
Companies must take reasonable steps to verify your investor status before you can make a stock purchase.
- If you plan to use the annual income test, the company will require copies of your income taxes for the past two years to verify that your income surpasses the threshold.
- If you are not a Nigerian taxpayer and still want to use the annual income test.
- You may also need to present proof that your country imposes penalties for providing false information on tax returns that are similar to those in the US.
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Accredited Private Business Investor
7. Request a copy of your credit report.
The company issuing the stock you want to buy will likely run a credit check on you to verify your liabilities if you’re trying to qualify as an accredited investor under the net worth test.
- While the company typically will make their own request rather than simply taking a copy you provide, it’s in your best interests to go ahead and pull a copy of your own report so you can see what’s on it and correct any errors you might find.
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Accredited Private Business Investor
8. Pull together banking and brokerage statements.
If you’re using the net worth test, you’ll need proof of all the assets you’ve listed.
The statements must be recent and should identify you as the owner of the asset and clearly state the value of the asset.
- You may want to get these documents signed or certified. Talk to your bank or investment advisor to find out the process for doing this.
- You also may want to get copies of any ownership documents, such as deeds or titles.
- If you own real property that hasn’t been appraised in the last year or so.
- Go ahead and get an appraisal on the property.
- So you will have the most recent fair market value of the property.
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Accredited Private Business Investor
9. Talk to an attorney, accountant, or investment advisor.
Some companies will accept a letter from an independent third party as proof of the value of your assets.
If you decide to go this route, choose someone who is a certified financial professional.
- A letter from an attorney or investment advisor can be especially helpful if you have assets that are particularly difficult to value, or if you have assets in the country and in foreign countries.
- A financial professional also can help you understand what information and documents you’ll likely need to verify your status.
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Accredited Private Business Investor
10. Obtain an investor questionnaire.
Under the SEC rules, companies that issue unregistered stock.
Are required to verify that anyone purchasing that stock is an accredited investor.
Each company typically has a form you must fill out listing your income, assets, and liabilities.
- You will have to provide documentation to back up any of the information you include on the questionnaire.
- While each questionnaire may have some differences, most of them ask the same basic questions.
- The questionnaires are designed to track the SEC rules so that the company can determine with a glance whether you qualify as an accredited investor.
Accredited Private Business Investor
11. Provide your personal information.
Investor questionnaires ask for basic personal information, including your name.
The address of your primary residence, and whether you are married.
You also may be asked your job title and educational background.
- If you have an attorney or investment advisor who assists you with any of the assets listed on the form, there will be space for you to provide their name and contact information.
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Accredited Private Business Investor
12. Describe your income and assets.
The questionnaire will include spaces for you to list your total income and assets.
You typically won’t have to itemize anything on the questionnaire, just give a total amount.
- The purpose is to determine whether you qualify as an accredited investor.
- If you don’t qualify based on your answers.
- The company typically won’t ask you for any supporting documentation.
- On the other hand, if you claim you have assets totaling $1 million or more, or income of $200,000 to $300,000, the company will need documentation to back up those claims.
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Accredited Private Business Investor
13. Sign the document certifying the information.
You typically must initial in several places certifying that you believe you qualify as an accredited investor.
You also must certify that you have knowledge and experience with finances and investment.
And are capable of making sound investment decisions.
- It’s okay if you have limited investment experience on your own.
- As long as you have a securities attorney or an investment advisor working with you.
- When you sign the questionnaire you are certifying that all the information you have provided on the form is complete and accurate to the best of your knowledge.
- Your signature typically doesn’t have to be notarized.
- And it isn’t a legal document in the sense that you face perjury penalties.
- However, you won’t be able to purchase stock in the company.
- If you can’t provide documentation to back up the information you provided on the questionnaire.
Accredited Private Business Investor
14. Submit all requested documentation.
The company typically will be in touch with you to request specific documents.
That will back up the claims you made on the questionnaire.
In some cases you’ll be provided a list of documents to submit along with the questionnaire.
- Pay attention to the requirements.
- Some documents may need to be certified.
- If you are a foreign investor, some documents may need to be translated into English.
- These translations may need to be certified.
- Contact the company issuing the stock to find out for sure.
Accredited Private Business Investor
When deciding on a business idea, let factors like your passion and expertise guide you.
You also want to consider how difficult and expensive it will be to launch this side business.
In most cases, your business idea should be relatively inexpensive to start.
You should reinvest what you make into the business to help it grow faster.
Finally, you want to make sure that your business idea is legal.
You don’t want to get in trouble with the law or IRS. I recommend setting up a company to help protect you personally, as well.
If you’re still stuck on business ideas that you can launch while working full-time, here are 25 possibilities to help get you started.
1. Local Business Consultant
If you have experience or knowledge in a specified field, then put those skills sets or certifications to use by becoming a consultant for local business owners. There are plenty of businesses that might be willing to pair with you to help them solve a problem, such as implementing a business strategy or managing social media. You can use this handy 18-Step Checklist to get started.
2. Repairs or Handyman
If you’re good at home repairs, like replacing a window, fixing a leaking pipe, or putting together a piece of furniture, you can definitely use those skills to help people who either don’t have the time or skills to do so on their own.
3. Graphic Design
Having experience or training in graphic design is definitely a plus. But if this is an area that excites you, you can learn graphic design on your own and become one of the 10 million designers now working in the U.S. Also, there are now sites like Canva and Adobe Post that make graphic design work possible for anyone.
4. Web or App Design and Development
Web or app design and development is another field that is becoming increasingly important for businesses, as they look to enhance the experience of their customers. Just as with graphic design, experience is beneficial, but there numerous online courses on sites like General Assembly, Skillcrush, or CareerFoundry that can teach these skills.
5. Blogger
If you’re passionate and knowledgeable in a certain area and you enjoy writing, then you can start blogging as a way to bring in a little extra cash. Keep in mind that this won’t happen overnight, and you probably won’t become rich, but working with affiliate programs, selling ad space, and publishing an e-book are ways that you can earn money through writing. I personally have been able to earn extra cash over the years by blogging.
6. Social-Media Expert
Companies are more than willing to pay people to manage and handle their Facebook, Twitter, or whatever other social-media channels they possess. You can find opportunities on freelance websites like Freelancer and Upwork, or on Paid Social Media Jobs.
7. Tax Preparation
If you’re good with numbers, then you can prepare taxes for busy individuals and business owners for a decent return–tax preparers charged an average of $229 per return in 2010. To get started, here are a few sites for accountants.
8. Educator
You can also share your knowledge by tutoring or teaching a course online on sites such as Tutor.com or Udemy.
9. Event Planner
Do you love throwing parties or are you extremely organized? Then you can become an event planning service. Entrepreneur has an excellent article on how to launch one.
10. Personal Chef or Catering
You don’t have to be a trained chef to launch this business. But it wouldn’t hurt to take a course or two to pad your résumé and put clients at ease. You can do so by visiting the American Personal & Private Chef Association.
11. Tour Guide or Travel Agent
If you love travel or showing off your hometown’s attractions when someone visits, then you can become a local tour guide or travel agent. The Travel Academy has information on travel agent training, while The Penny Hoarder has advice for becoming a local tour guide.
12. Bed and Breakfast
If you have the extra space and enjoy entertaining others, then get into the bed and breakfast business, if you’re zoned correctly. Thanks to Airbnb, you can now rent out a room, apartment, or house with relative ease. I personally do this, and it helps to dramatically lower my expenses each month.
13. Interior Designer
For creative and imaginative individuals, consider launching your own interior design firm. As the American Society of Interior Designers states, you can then work with clients to identify designs that are “aesthetically appealing, technically sophisticated, and pragmatically satisfying.”
14. Landscaping or Gardening
Love being outside? There’s no better business then landscaping or gardening. While a degree isn’t required, you may want to earn a certification in horticulture at your local public college. If you’re concerned about finding work during the winter, add a snowplow to your truck to provide snow removal service.
15. Cleaning Service
You’ll definitely get your hands dirty, but you should have no shortage of clients. There are plenty of businesses and busy individuals looking for a weekly cleaning service.
16. Delivery Service or Uber or Lyft Driver
I’ve lumped these together because they both involve using your vehicle to start a new business. The first idea is to start a delivery service to transport anything from office supplies to after-hours food to college students. Check to find out if you need any special licenses or permits for a delivery service in your area.
The other idea is simply becoming an Uber or Lyft driver during your downtime. Depending on the hours that you work and your location, you can make a solid living going in this direction.
17. Brewery or Vineyard
Who doesn’t enjoy a beer or a glass of wine every now and then? Take that love and start your own microbrewery with kits like Mr. Beer. If you prefer wine, you can also start your own vineyard, if you have the land. Both ideas will take hard work and several years to take off, which makes them appealing as you hold down your current full-time position.
18. Photographer or Videographer
If you excel at capturing a story through the lens, then this profession deserves mention, since it’s something that you can do based on your schedule. Just remember, find your niche and stick with it. If you’re a wedding photographer, focus on that. If you’re more skilled at taking professional headshots or filming promotional videos, market that expertise.
19. Handmade Items
If you have a knack for creating crafts, jewelry, or clothing, then you can start selling these handmade items via sites such as Etsy, CafePress, or eBay.
20. Senior Home Companion or Caregiver
Did you know that, according to U.S. News & World Report, there “are now more Americans age 65 and older than at any other time in U.S. history”? If you’re kindhearted, patient, and looking for a rewarding career that’s in demand, then consider becoming a senior home companion or caregiver.
21. Exercise or Health Specialist
Don’t be surprised to find out that your local gym will exchange membership dues for teaching a course. In fact, they may even offer training. After a while, you may even start earning more than just a free membership. However, you can also become a personal trainer through the NASM Certified Personal Trainer program.
22. Pet Care or Training
Whether it’s walking your neighbors’ dogs, training their four-legged friends, or watching their pets while they’re on vacation, working with pets can be a lucrative side business (Americans were on track to spend more than $60 billion on their pets in 2015, according to NBC News) that you can do in your spare time.
23. Child Care
If you don’t have any plans this weekend or have availability on afternoons and you’re great with kids, then offer to babysit or become a nanny. Start out by letting your friends, family, and neighbors know. If you watch children in your home, you may have to get a license.
24. Translator
If you’re fluent in another language, or would love to learn, you can also start making a living as translator. To get started, you should get accredited or earn a certification. After that, you can find gigs on most freelance websites.
You can also use your language skills to teach English to students either remotely or in an actual classroom.
25. Exclusive Product Distributor
You’ve heard of Avon and Tupperware representatives, right? You too can become a direct marketer for exclusive products to make some extra cash on the side. If you find a legit company and are dedicated, this may actually become a full-time job.
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