The single most popular trend in investing today is passive investing. Most people associate passive investing with low cost, broad based index funds like those you can purchase at Vanguard. But can you be a passive investor with a more complex strategy? M1 Finance thinks you can.
Their innovative investing platform brings together the best of “behavioral alpha” and low cost brokerages to help users invest with confidence. If your investment strategy includes individual shares and low cost ETFs, you’ll be hard pressed to find a better investment tool than M1 Finance.
In fact, we've had M1 Finance "Honorable Mentions" on our list of the best brokers to invest at this year. They're also consistently mentioned by our readers as one of the best places to invest. Here's our review.
Promo: Open and fund a new M1 Account with at least $10,000 by December 31, 2023 and receive up to a $500 bonus. See all rules and details. Open an M1 Account here >>
M1 Finance Details | |
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Product Name | M1 Finance |
Min Invesment | $100 |
Annual Fee | M1: $0 M1 Plus: $10/mo or $95/yr (First 3 months free) |
Account Type | Taxable, IRA, Custodial, Trust, More |
Promotions | $75 to $15,000 Bonus |
Who Is M1 Finance?

M1 Finance is a brokerage and robo-advisory firm that was founded in 2015 by Brian Barnes. In his book Nudge, behavioral economist Richard Thaler, “people have a strong tendency to go along with the status quo or default option.”
Humans need a good default option, or we’ll make bad decisions. This is especially true in investing. It’s easy to have great investing intentions, but fail to follow through on them.
M1 Finance addresses this concern. Their low cost investing platform allows you to set up your ideal portfolio, and automate contributions to the portfolio. Once your default is set, you don’t have to think about it again.
M1 Finance was also named one of our Best Free Investing Apps for 2023.
What Does It Offer?
M1 Finance sets itself apart from the robo-advisory crowd primarily through its pricing. Not only do stocks and ETFs trade commission-free, but you pay nothing for AUM with a standard account.
That's right, you don't have to pay any advisory fees with M1 Finance. This is fantastic for a company that offers automatic wealth management services that most platforms charge for like custom portfolios and dynamic rebalancing.
Plus, they also offer convenient banking services with M1 Spend, and you can even borrow against your investments with M1 Borrow.
Combined - all of these low cost services make M1 a compelling choice to invest.
M1 Crypto
Yes, it's true! M1 launched crypto and you can start researching crypto and building crypto Pies. What's great is that you can create a balanced crypto portfolio in the same way you would with other assets.
The company says it's just one part of an ongoing process to offer new asset classes, products, and ways to invest.
The advantages of adding crypto are plenty, as you can:
Low Price Includes Fractional Shares
It’s important to mention that most robo advisors work in the intersection of behavioral finance and portfolio theory. Most implement efficient rebalancing into their algorithms. Some (including Betterment and SoFi Wealth) are close to on par with M1 Finance.
But some users won’t find those lower cost robo-advisors as compelling as M1 Finance. This is because M1 Finances allows investors to include fractional shares in their portfolio.
What are fractional shares? Imagine that Amazon stock $AMZN is $800, but you only want to own $200 worth of stock. Traditionally, you could buy no less than 1 full share of stock. Fractional shares allow you to own just $200 worth of $AMZN or 0.25 shares. Low cost brokerages have allowed investors to employ fractional shares for years. But M1 Finance is among the first automated investment platforms that allows you to invest in fractional shares.
This means that investors can invest in particular stocks in part of their portfolio and in index fund ETFs in the other part. It should be noted, though, that M1 Finance doesn't currently support mutual fund investments.
Automatic Rebalancing
M1 Finance does more than automate investing. It automates efficient rebalancing. Rebalancing involves buying the asset class that is underweight and selling that class that is overweight. “Buy low, sell high” is a shorthand way of saying rebalance your portfolio.
M1 Finance does that for you automatically. First, you set your ideal portfolio structure, which M1 Finance calls "pie investing." Then every time you add money to your portfolio, M1 Finance automatically buys the most underweight asset. Every time you sell, they automatically sell the most overweight asset.
M1 Spend
M1 Spend is an FDIC-insured checking account integrated directly into the M1 Finance app. There are two different tiers to M1 Spend - the basic M1 Spend (which is free), and M1 Plus, which is a premium service.
M1 Spend is completely free. It will be included in all M1 accounts to make managing money easier between all three pillars (Invest, Borrow, Spend). M1 Spend will allow users to receive paychecks, pay bills, and pay with a debit card - all for free.
The basic M1 Spend doesn't offer any interest or cash back. But if you upgrade to the M1 Plus premium membership option, you'll earn 1.70% and 1% back on all debit card purchases. You'll also gain the ability to send physical checks for free.
The big drawback to M1 Plus is that is does cost $95 per year, or $10 per month. That's a lot of money. We don't know if the value of M1 Plus is there right now to support these fees.
Learn more about M1 Spend here.
M1 Savings
M1 recently launched the M1 High-Yield Savings Account, which currently offers a whopping 5.00% APY. The account has no minimum balance requirement. However, this high rate is only available to M1 Plus subscription members, which does cost $10 per month.
As a result, you need to have at least $2,500 in savings just to break even (at $10/mo in M1 Plus fees). If you're already using M1 Plus for other features - such as Spend and Borrow - it could make sense.
Otherwise, you might be better off in a traditional high-yield savings account that doesn't have a monthly fee involved.
Smart Transfers
One of the latest perks for M1 Plus member is Smart Transfers. This feature allows you to make transfers from your Invest to Spend account, or from your Spend to Invest account, based on rules you setup.
While you can always make one-time transfers, Smart Transfers allow you to setup rules like, Transfer every dollar over $1,000 from my Spend to Invest account. This has great potential as it allows you to deploy your cash based on rules you set.
Vice versa, if you're trying to build or replenish an emergency fund, you can setup your Invest account to transfer all of your cash from things like dividends back into your Spend account.
M1 Borrow
M1 Finance also recently announced a unique feature called M1 Borrow. Using M1, people can invest for free in exactly what they want. But doing so automatically opens up a portfolio line of credit at one of the lowest interest rates on the market. It is significantly easier to access, more flexible on terms, and lower cost than any other method of borrowing money that we've seen, whether it’s a mortgage, HELOC, auto loan, or personal loan.
This type of borrowing has historically only been available to the ultra-wealthy, who use it extensively due to the flexibility and low rates. M1 Borrow makes this even easier and less expensive, and opens it up to a much larger audience.
To qualify, users must have a taxable M1 brokerage account with an account balance of $5,000 or more. IRAs do not qualify. Your credit score doesn't matter and M1 Finance doesn't do a credit check since it uses your portfolio as collateral.
You can borrow up to 35% of your account's equity balance out as a loan. The interest rate for standard accounts is 8.75% which is already very low when compared to the margin rates of other brokers. And M1 Plus members can get an even lower rate at 7.25%.

The really interesting thing is there is no set payment schedule. You can pay this back as you see fit, simply realizing interest every month on your outstanding balance.
There are three main risks with using M1 Borrow: interest rates rise, the portfolio value declines and forces a maintenance call, or losses are magnified due to leverage. Make sure you're aware of these risks if you take advantage of this feature.
Custodial Accounts
If you have M1 Plus, you get access to custodial accounts - where you can setup an account for your children to invest for the long term. This account is a UGMA or UTMA account that you hold and make contributions to on behalf of a child.
You (the custodian) can manage the account, but the child is the beneficiary of the account and the owner of the assets in the account. Each deposit is considered an irrevocable gift, and there is no maximum amount that can be contributed.
It's important to remember that this type of account can have implications for financial aid. If you're considering using this account to save for college, we recommend you use a 529 plan instead.
Owner's Rewards Card by M1
M1 Finance launched the Owner's Rewards Card and it is an awesome rewards card that can deposit cash back into your M1 Finance account.
The card offers a flat, 1.5% cash back. M1 Plus Members earns 2.5%, 5%, and even 10% cash back at certain popular brands.
Additionally, cardholders who have never tried M1 Plus can enjoy their first 90 days of M1 Plus for free prior to the start of their yearly membership.

Unlike other rewards cards, the cash back that you earn with the Owner's Rewards Card can be automatically reinvested into your M1 Invest portfolio. And this card has no annual fee.
Bonus Offers
M1 Finance is currently offering a bonus offers for opening a new account with enough cash.
New users who open and fund an account by December 31, 2023 will receive up to a $500 bonus. Here's how much you can earn with this bonus:
- $10,000 - $29,999: $75 Bonus
- $30,000 - $49,999: $150 Bonus
- $50,000 - $99,999: $250 Bonus
- $100,000+: $500 Bonus
ACAT Transfer Bonus - Up to $15,000
M1 is also offering a huge transfer bonus to qualifying ACAT transfers made by June 17, 2023. You can earn up to $15,000 - but it does require a significant amount to transfer. Read the full transfer promotion here >>
Are There Any Fees?
All of M1's basic accounts (Invest, Spend, and Borrow) come with no monthly fees and all of its supported investments trade commission-free.
M1 Plus is a premium offering that allows lower interest rates on Borrow, and access to their High Yield Savings Account. The first three months of M1 Plus is also free as long as you're a first-time member. But after that, M1 Plus costs $95 per year, or $10 per month if you pay monthly.
There are also a few miscellaneous accounts that you'll want to be aware of. For example, you'll be charged a $20 inactivity fee if you don't log into your account for 90 days and $25 for wire transfers. Trades will also incur SEC and TAF regulatory fees that are generally only a few cents. See M1's full fee schedule here.
How Does M1 Finance Compare?
M1 Finance is one of our top picks for places to invest because it's commission-free, offers great tools and features. It's an honorable mention in our Best Places To Invest list.
Check out this quick comparison here:
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Rating | |||
Commissions | $0 | $0 | $0 |
Min Investment | $100 | $0 | $0 |
Banking? | |||
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How Do I Open An Account?
You visit the M1 Finance website to start your application.
You should receive an email within a day to let you know if your account's been approved. However, in some cases, M1 may ask you to submit identity verification documents. The following types of accounts can be opened with M1:
- Individual accounts
- Joint accounts
- IRAs (Traditional, Roth, SEP)
- Trust accounts
- Custodial accounts (M1 Plus users only)
M1 Finance will allow users to open multiple accounts under the same login. Currently, the limit per individual login is five accounts.
Is It Safe And Secure?
Yes, M1 Finance uses military-grade 4096-bit encryption on its sites and offers two-factor authentication (2FA) for account logins. Investment accounts are protected by SIPC insurance up to $500,000 and cash accounts are FDIC-insured up to $250,000.
How Do I Contact M1 Finance?
You can contact M1's support team by chatting live on their website or submitting a request using this contact form. It also provides a robust set of articles and tips inside its Help Center.
You won't find a customer service phone number or email address on M1's support page. However, we were able to find it on a separate legal page. To contact M1 by phone, you'll want to call 312-600-2883. Or if you prefer to reach out via email, you can do so at support@m1finance.com.
Is It Worth It?
As with all investing platforms, M1 Finance isn’t for everyone. But if you're looking for free access to robo-advisor portfolios, M1 is one of the cheapest player out there - along with Charles Schwab's Intelligent Portfolios and SoFi Invest.
Anyone who subscribes to a “technical analysis” investing philosophy should avoid M1 Finance too. You’ll spend too much time manipulating your portfolio. Instead, you'll want to choose a trader-focused broker like TD Ameritrade or Ally Invest.
M1 Finance offers real value to investors:
- Free Trading
- Free IRAs
- Automated Deposits
- Completely Automated Portfolio Management (completely customizable)
- Fractional Shares
- One Touch Rebalances
- Low Margin Rates
- M1 Crypto
One thing that you should note. All of M1 Finance’s portfolio dashboards consider your M1 Finance portfolio. If you’ve got significant assets in your work 401k or an outside account, you’ll need an overall portfolio balancing strategy. Consider Empower to get total portfolio statistics.
Honestly, M1 is a great choice, and as they continue to add more features and support, we're excited by what they are doing. Check out M1 here.
M1 Finance FAQs
Here are a few of the most common questions we hear about M1 Finance:
Can I buy individual stocks on M1 Finance?
Yes, unlike many robo-advisors, M1 Finance does allow clients to invest in individual stocks and ETFs and even allows fractional share investing in both.
Can you use M1 Finance on a computer?
Yes, M1 Finance offers web and desktop account access in addition to its mobile apps which are available on iOS and Android.
Can foreigners use M1 Finance?
No, currently only U.S. citizens or permanent residents are eligible to open accounts with M1 Finance.
What bank does M1 Finance use?
M1 Finance Spend accounts and debit card services are both provided by Lincoln Savings Bank, Member FDIC.
Does M1 Finance offer any bonuses or incentives for new clients?
Yes, new clients who transfer their accounts from another investment platform can earn a bonus of up to $15,000. Also, it's currently offering three months of M1 Plus for free.
M1 Finance Features
Account Types |
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Minimum Investment | $0 |
Management Fees |
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Stock Trades | $0 |
ETF Trades | $0 |
Mutual Fund Trades | N/A |
ETF Expense Ratios | 0.06% to 0.20% |
Fractional Share Investing | Yes |
Checking APY |
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Debit Card Cash Back |
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Margin Rates |
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Socially Responsible Investments | Yes |
Access to Human Advisor | No |
Automatic Rebalancing | Yes |
Tax-Loss Harvesting | No (but there is a tax "minimization" feature) |
Customer Service Number | 312-600-2883 |
Customer Service Email | support@m1finance.com |
Other Customer Support Options | Live chat Support tickets |
Web/Desktop Account Access | Yes |
Mobile App Availability | iOS and Android |
Promotions | Up to $10,000 bonus |
M1 Finance Review
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Ease Of Use
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Overall
Summary
M1 Finance is a free investing platform that allows for commission-free investing and AUM-free robo-advisor service. They also offer banking services and pledged asset lines.
Pros
- Commission-free investing
- No AUM fees on robo-advisor portfolios
- $100 to get started
- One of the lowest margin rates
Cons
- Not designed for active traders
- No ability to invest in mutual funds

Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page or on his personal site RobertFarrington.com.
He regularly writes about investing, student loan debt, and general personal finance topics geared toward anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications, including the New York Times, Wall Street Journal, Washington Post, ABC, NBC, Today, and more. He is also a regular contributor to Forbes.
Editor: Claire Tak