M1 Finance Review: Fractional Investing Online
The M1 Finance app can help you build your investment portfolio for free. The full-service package can give you access to credit, allowing you to supplement your investments with borrowing. Unlike many apps, M1 Finance will let you open a checking account too. The more services you can bundle into one, the simpler your life can become. There are no monthly use fees with the entry-level app.
It does not have all the features and flexibility of a full-service brokerage. The app does not engage in tax harvesting, so this needs to be done by your accountant or tax preparation service. Retirement services on the app are limited to an IRA account.
To unlock the full power and features you need to subscribe to the fee service called M1 Plus.
M1 Finance provides a convenient way to stay on top of your investments by using your phone. Beginner, intermediate, and advanced users can find a lot of value here. Professional investors may find it too limiting.
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M1 Finance Review for Personal Accounts
Money may not buy happiness, but it can certainly help you on your way. I’ve done the research and compiled my findings in this M1 Finance Review so you can focus your attention where it is most important.
There are many apps that make it easier to invest in stock market products. M1 stands out because it gives you access to more features than other mobile investment products. It’s a money-saving app, a money-loan app, and an investment app all rolled into one. A good money lending app should also include educational tools, so M1 has a great library of resources for learning too.
The best finance apps are built by the best people. M1 Finance is ranked among the best financial management apps because they have created a great team of financial professionals to manage their system.
Money-saving apps can help you improve your financial literacy and get you on the road to financial freedom. How much you earn isn’t as important as how you spend it. You could be making a million dollars a year and not make progress if you have the wrong relationship with your finances.
When you decrease your financial stress, it gets easier to make good decisions. You can think more clearly and feel less anxiety. Change takes time, but you can see measurable results today.
I use the Wellness Wheel to help teach what financial wellness truly is. Money is an important part of happiness, but it sure isn’t all. The wellness wheel helps me organize my life better so I don’t neglect important areas.
Keep reading to learn how M1 Finance can make your money work harder for you.
- Finding the Best Financial Management Apps
- Invest Your Way
- Find Help Navigating Fees, Common Issues, and Upgraded Accounts
Finding the Best Financial Management Apps
M1 Finance is a beginner-friendly, all-in-one financial services app. With M1, you can invest, open a checking account, use a debit card, borrow on margin to invest more, and even manage a retirement fund. Customization is the name of the game with this app. You have a lot of control over how much of your money goes to what account, what stock you choose, and what percent you choose. Accounts with M1 don’t need to be actively managed as many other options.
Invest Your Way
You can choose your own stocks while still getting automated advice from M1’s Robo-advisor feature. With their adjustable weighted pie feature, you can customize how much of your money goes to each investment. M1 offers you the flexibility of investing in fractional shares. Some stocks can cost tens of thousands of dollars per share. Fractional shares investing allows you to invest as much or as little money as you would like, even if you do not invest enough to buy a full share. The minimum to open an account is only $100, so it’s cheap and easy to get started on the road to financial success.
Mutual funds are a popular way for many people to invest. At this time, M1 Finance does not offer you the ability to invest in mutual funds. While this may be a drawback for some, mutual funds are not as flexible as investing in individual stocks. Investors who want to have a lot of control over their portfolios may not miss this option at all.
The team at M1 does offer recommendations that allow you to keep your investments balanced. You can decide, for example, to keep 12% of your investments in one stock, and 15% in another. As the prices for each stock fluctuate, your account will automatically rebalance to keep your proportional investment consistent. This is a similar experience to a mutual fund, but allows you more flexibility and control. This is an option that is good for people who want to try a more hands-off approach, like what you get from a hedge fund. The drawback of this approach is you don’t learn as much about how to invest and manage your own finances. M1 also doesn’t engage in tax harvesting, so when it comes time to pay your taxes, you will need to have your accountant make the necessary calculations.
Find Help Navigating Fees, Common Issues, and Upgraded Accounts
Starting an account with M1 is simple, easy, and low cost. When an account over $20 is inactive for more than ninety days, your account will incur a $20 fee. This feature is intended to ensure you take a more active role in your investment portfolio.
There is an upgraded version of this app called M1 Finance Plus that also carries an additional fee. One drawback of M1 is that human advisors are not available. Their Robo advisor provides a similar experience, but if you are after a human consultant to talk with about your investments, you may be disappointed. This is not as big of a drawback as some brokerage firms may tell you, as humans are not very good at picking stocks. There are well-known stories of chimpanzees beating stockbrokers by picking equities at random.
M1 does have support staff that can be contacted for troubleshooting technical problems. Staff is available via phone or email during normal business hours. If you encounter a problem on holidays or weekends, you may find longer than normal wait times. Trading is a lot lighter on the weekends, so this should not impact your account significantly. There is no one available after hours, but the automated chat tool is available 24/7 and is surprisingly effective. In most cases, the chat tool will answer your questions faster and easier than a human operator.
Access to margin accounts makes M1 the ideal app to borrow money. Most mobile services don’t even have an option for margin accounts. Combined with the optional checking account and other top-shelf features, M1 is among the most powerful apps on my phone.
I recommend you give M1 Finance a try. Download the app today, and explore how much more profitable your investment dollars can become.
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