M1 Finance Review for 2022: Is it Legit?

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m1 finance review

Robo investing platforms have taken the investing landscape by storm. Long gone are the days where you had to figure out all aspects of investing, now you can have computers do that for you. This is where Robo investing platforms like M1 Finance comes in. Let’s review M1 finance and see how it works.

M1 Finance takes away all the complicated steps and aspects of investing, and instead invest all your money for you using pre-built templates. You can also customize these.

The most fantastic thing about M1 Finance is that not only does it provide Robo investing, it also gives you the freedom to choose your own Investments. This is excellent for those that want to be more hands-on.

Now, without further ado, let’s take a closer look at M1 Finance, review it, and learn a little bit more about it.

What Is M1 Finance?

Let’s start this review with a bit of history on M1 Finance. M1 Finance was first established in 2015 in Chicago. With time, it has grown to well over 250,000 funded accounts and holds over 500 million dollars in assets. Pretty impressive, considering how relatively young it is in the game.

This has not swayed investors though. Considering its large assets and active user base, it is definitely proved itself amongst other competitors. It can definitely stand its ground against services such as Robinhood and Betterment.

Unlike other investment platforms that focus on either being solely Robo investing platforms or traditional online brokerages, M1 Finance combines the two.

This is fantastic news for both novice investors and others that are more experienced. This platform caters to both.

How Does M1 Finance Work?

Unlike the standard Robo-investing apps out there, M1 Finance gives you complete and utter control of your finances and Investments. This means that you are in complete control of how your money is invested. This also means that you can always make changes as you go.

Pie Investing System

A highlight of this review is the Pie Investing System M1 Finance provides. Basically, pies in M1 Finance consist of as many as 100 slices. Each slice represents an investment, Buda stock, ETF, or other pies.

Pies give you an easy to understand visual representation of what you like investing in. This makes it much easier to digest your Investment Portfolio.

M1 Finance has more than 60 pre-built pies that you can choose from. You can either create your own, or even just to pick one of the pre-built pies to start with.

Once you’ve selected a pie or built your own pie, M1 Finance will purchase the Investments automatically. This is all based on the proportions of your pie. This is done both initially when you set up your account, and when you add additional funds to the account.

Funding your account

Now that you have set up your investment account and portfolio, you will now gets to you on your account.

This is done by simply linking your bank account with M1 Finance. Once linked, you can make direct transfers into your brokerage account. This step is super easy and very secure.

All you need to do is search your bank account from the list. Once found, simply enter your login credentials and start funding your M1 finance account.

M1 Finance has $100 minimum deposit to start with. Simply deposit that amount, and you are ready to go. As easy as that.

Fractional shares

M1 Finance also supports fractional shares. This means that you are able to buy a fraction of a share instead of having to buy an entire share.

For example, instead of buying one share of Amazon worth about $1,000, you can buy 50% off a single Amazon. This means you will only pay $500 for that fraction of a share. The fraction you want to actually purchase is totally up to you.

Now you don’t have to worried about money sitting idle in your account without earning you more money. Every dollar that you have in that account will be allocated and work for you.

Is M1 Finance safe?

Like any other service that handles money, it only makes sense that you want to be sure your money is safe. Well, great news! M1 Finance is very secure.

M1 Finance takes all the available legal and security precautions to safeguard your money. M1 Finance is a member of the Security Investment Protection Corp (SIPC). This oversees any liquidation of a firm in the event of bankruptcy or financial trouble.

This means that SIPC insures the value of your Investment Portfolio as well as cash reserves up to $500,000. This includes up to $250,000 in cash. M1 Finance also uses top-of-the-line encryption and Bank transfers are handled by third-party services. This also means that they don’t store any of your banking details.

So yes, M1 Finance is very safe and secure.

Other features

You would think we would have covered everything at this point, but M1 Finance has a few more features up its leaves.

M1 Spend

M1 also offers a digital checking account that comes with an actual plastic debit card. This digital checking account works the same way as any other regular checking account.

You can use this debit card to make regular purchases. This gives you direct access to your brokerage account and portfolio line of credit. This is grateful people that are willing to mix their investment accounts with the day-to-day purchases.

M1 Plus

M1 plus is similar to M1 spend but offers additional perks. At the time of writing this article, and one plus offers a 1.5% interest checking account in 1% cashback on all purchases.

By using M1 Plus, you also get a fancy tungsten metal debit card. You will also get a 0.25% discount on borrowed funds from your portfolio credit line.

One thing to remember though is that, M1 Plus carries a $125 annual fee.

M1 Finance Final Thoughts

There is definitely a lot to love about M1 Finance. Just looking at all the features and ease-of-use, it is definitely worth your while taking a look at it.

M1 Finance is definitely catered more closely to those starting out investing And want more of a passive approach to investing. M1’s unique approach using pie investing it’s very easy to understand and master. Definitely a unique selling point, compared to other investing apps out there.

Just like any other Financial Service, there are some drawbacks to remember. This broker does not offer any mutual fund investing, day trading tools, and the ability to fully customize an investment portfolio for more experienced investors.

Other than that, if you are a novice investor and want to put your investments on autopilot, and one Finance is definitely worth checking out. If you are a more seasoned and experienced trader, M1 Finance might lack the tools you need.

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