M1 Finance Review

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M1 Finance is one of the top platforms for investing in ETFs (exchange-traded funds) and individual stocks. Their standard account has zero fees, no minimum account balance, and access to almost every publicly traded stock. It’s easy to use and has core features that make investing in your portfolio quick and easy. To see for yourself just how great M1 is, check out this in-depth robo-advisor comparison

M1 Finance packs in many slick features into its platform, considering they have no account minimums and zero service fees. Some notable features are its dynamic portfolio rebalancing and pie-based investing tool. These two tools are perfect for investors that like to build their own custom portfolios. 

With all the features and benefits that M1 Finance provides, you really get good value for your money. This review is short and to the point; for a more thorough review, check out this in-depth M1 Finance review for more information. This review covers the critical components of M1 Finance, so read on to learn more. 

M1 Finance Portfolios

The key feature that sets M1 Finance above its competitors is its pie investing. Pie investing is available in M1’s main product- M1 Invest. M1’s pies are made up of various stocks represented as “slices.” The slices can be either stocks, bonds, or ETFs. 

M1’s pies can be customized for any risk tolerance and made up of investments that are entirely your choice. There are thousands of different investment options on M1 Finance’s platform- so finding the best investments for you shouldn’t be a problem. 

Furthermore, M1 Finance allows you to invest in fractional shares of all stocks offered on its platform. With fractional shares, you don’t have to break your wallet paying the total price for those high-dollar per share companies like Amazon and Tesla. Therefore, M1 is an excellent platform for investors just starting out

M1 Finance Account Types

Besides their core service, M1 Invest, M1 Finance offers many additional, fantastic account offerings. If you want to keep all of your accounts in one place, you can do that in M1 Finance. They have these account available: 

  • M1 Spend (checking account)
  • M1 Invest (taxable brokerage account)
  • Rollover IRA
  • Traditional & Roth IRAs 
  • SEP IRAs

Other accounts, like 401ks, cryptocurrencies, and 529s, are not offered on M1 Finance. However, they could eventually add support as they expand. 

M1 Finance Features

M1 Finance has many great features that make it a desirable robo-advisor platform for beginner and seasoned investors. Their pie-based investing system is what makes them unique and sets them apart from the competition. 

M1 Finance Expert Pies

When you are first building your portfolio in M1 Finance, you can create a “pie.” Your M1 Finance investment pie comprises “slices,” which represent individual stocks, bonds, or ETFs. For each slice, you can set a specific target allocation. For example, you can have 50 slices each with a target allocation of 2%, or each of the 50 slices could have a unique allocation target.

M1 will automatically rebalance each slice periodically to match your target allocations. The pie-based system makes for an easy method to invest in all of your favorite investments at once since all you have to do is make a single purchase of the pie. 

If you prefer managing your finances with little work, M1 Finance has got you covered with their Expert Pies, so you don’t have to create one yourself. Every expert pie can contain a mix of ETFs, bonds, and stocks- all chosen by expired financial advisors using quantitative analysis. You can invest in every expert pie as-is, or you can add it to your own custom pie for further customization. 

Here are some examples of M1 Finance’s Expert Pies:

  • Stocks and bonds
  • Income earners
  • Hedge fund followers
  • General investing
  • Income earners
  • Planning for retirement

M1’s expert pies take the guess-work and research out of making your own pie, making it an excellent choice for novice investors with little time to research. 

M1 Finance Automatic Rebalancing

Another benefit of M1 Finance is their built-in investment rebalancing. Remember, each slice of your investment pie has a percentage that you allocated to it. Therefore, M1 will spread each recurring purchase, so it fits your target allocation. 

For example, if one asset is overperforming the others when you make a purchase, that asset gets less of the deposit balance, and the other gets more. By automatically varying the amount of deposit each asset receives based on its performance, it allows your assets to catch up to the overperforming ones. 

M1 Finance One-Click Rebalancing

Besides M1 Finance’s automatic rebalancing, you can rebalance your portfolio at any time with a single click. You can do this by selecting “rebalance” under the portfolio pie in your dashboard. 

After selecting “rebalance,” M1 will execute trades to match your target allocations. As with all transactions on M1, they will occur during the next trading window, which is 9:30 AM eastern time. M1 plus subscribers gain an extra trading window near market close, at 3:00 PM eastern time. 

Dividend Reinvestment on M1 Finance

To maximize your stock performance, another way to invest with M1 Finance is with DRIP (dividend reinvestment plan) style reinvesting. DRIP is a welcomed feature for investors looking to capitalize on DRIP stocks. M1 displays your dividends in the activity tab and the performance section for each individual investment. 

By toggling the account’s cash balance to “auto-invest,” your dividends will be automatically reinvested. Just like any investment purchase in M1, your dividend reinvestment will be distributed evenly to the slices in your investment pie based on your target allocation. 

M1 Finance Cost

M1 Finance’s primary service, M1 Invest, is entirely free to use and has no account minimums. The only fees you will ever pay are fees built into ETFs, which you will be subject to no matter which robo-advisor or brokerage you use to invest. No brokerage fees mean you save money by managing your own investments

M1’s premium service, M1 Plus, is $125 per year and includes high APY features for M1’s checking account (M1 Spend), cashback, and an additional trading window. 

In short, we rate M1 Finance two thumbs up. It is an excellent service for all levels of investors.

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