A non-accredited investor is someone who does not meet the Securities and Exchange Commission (SEC)'s criteria for accredited investors. To qualify as an accredited investor, a person must have a net worth of at least $1 million, excluding the value of one's primary residence, or have an annual income of at least $200,000 in each of the two most recent years. Non-accredited investors typically have a net worth of less than $1 million or earn less than $200,000 annually.

Non-accredited investors are generally not allowed to invest in investments that the SEC considers to be highly speculative or risky, such as private placements and unregistered stocks. The SEC allows cash investments in these types of investments only if they are approved by a registered securities broker-dealer or provided by a private placement memorandum. This is because the SEC believes that these types of investments are too risky for someone who is unfamiliar with the investment world. Non-accredited investors also cannot invest in hedge funds or venture capital funds, as these investments are generally not registered with the SEC and have far less information available to investors.

While non-accredited investors face some limitations on the type of investments they can make, there are still many options for them to make investments in the stock market, mutual funds, ETFs, and other more conservative investments. Non-accredited investors may also be interested in alternative investments such as real estate investment trusts (REITs) and peer-to-peer lending. These types of investments can provide investors with an opportunity to diversify their portfolio, while still being relatively lower risk than private placement investments.

Non-accredited investors should also be aware that they may be subject to certain restrictions when investing. For example, if they purchase securities through a registered broker-dealer, they must comply with all the regulations that govern that broker-dealer. Additionally, they may be subject to certain restrictions regarding how much they can invest, the type of investments they can make, and the fees associated with their investments. Non-accredited investors should always do their own due diligence before investing, and should be aware of the restrictions on their investments.

It is important for non-accredited investors to understand that there is an inherent risk involved in all investments. However, with research, understanding the risks involved, and utilizing the guidance of a qualified professional, non-accredited investors can be successful in their investments.