M1 Finance Review 2018 | Invest for Free!


If you’re interested in investing for the long-term like I am, you’re probably always looking for ways to ensure that your investments grow as much as possible.

There ARE so many different approaches to building a portfolio, it can be tough to know what’s right for you. But there’s one often overlooked aspect of investing that affects every investor, regardless of their risk profile or annual income. And this variable can be the difference between saving or losing tens of thousands of dollars in returns. What am I talking about?


Brokerage account management fees, trade commissions, and excessive expense ratios are a surefire way to reduce your portfolio’s potential return.

Fortunately, robo-advisors like Wealthfront, Wealthsimple and Betterment have introduced automated investing platforms designed to drive down investing costs. Their annual account management fees, which range from 0.25% to 0.40% are better than you’ll find with most traditional brokerages.

But M1 Finance takes it one step further. M1 Finance offers its innovative, streamlined, and easy-to-use automated investing platform FOR FREE.

Saving 0.25% in fees each year might not sound like much, but it can really add up over time. Eliminating fees can be a very big deal. Plus, every dollar you don’t pay in fees is another dollar in your pocket (or your portfolio)!

You might be thinking, “Okay, so it’s free. But haven’t you ever heard you get what you pay for?” Fair question! With that in mind, let’s check out what else M1 Finance has to offer and see if it’s worth signing up for M1’s free automated investment app.

What is M1 Finance?

M1 Finance is an automated investing platform that provides some of the best robo-advisor features while also giving investors full control over their investment portfolio. And best of all, the service is completely free!

Who is M1 Finance for?

M1 finance reviewM1 Finance’s hybrid approach to investing makes it a great fit for just about any type of investor. If you’re looking for an automated investment management service that helps you design a portfolio that matches your financial goals, M1 has you covered. If you’d prefer to stay in control of your investment portfolio, M1 lets you customize to your heart’s content!

M1 Finance is a good fit for anyone who:

  • Is a buy-and-hold investor
  • Wants to be able to control what they invest in while leaving day-to-day management to someone else
  • Wants to invest without paying broker fees or commissions
  • Believes in Modern Portfolio Theory but still wants to mix in individual stocks
  • Likes free money just for opening an account

Click here to get $10 when you open and fund your M1 Finance account!

How Much Does M1 Finance Cost?

One of the biggest reasons why M1 Finance is my favorite automated investing tool is because of the price: FREE!

While M1 Finance charges for certain administrative services (e.g., wire transfers) and passes government-mandated regulatory fees along to the customer, the core product is completely free.

M1 Finance won’t charge any commission or mark-ups on trades. There aren’t any fees to rebalance your account. And they don’t charge you to reinvest dividend earnings.

How Does M1 Finance Make Money if it’s Free?

M1 Finance believes free investing services are the future of personal finance. That’s why they’re doing their part to usher in the future of investing with their free platform.

Even though their investing platform is free, that doesn’t mean they aren’t looking for other ways to generate revenue. According to M1 Finance CEO, Brian Barnes, “There’s no shortage of ways to make money outside of charging for services. In fact, the largest public brokerages typically only make 10-30% of their revenue from the commissions they charge.”

In case you’re wondering, some of the ways M1 can make money include earning interest on cash held in brokerage accounts, extending credit through margin to customers, and getting paid to distribute certain funds or transact on various exchanges.


How Does M1 Finance Work?

M1 Finance takes a unique approach to automated investing. M1 separates itself from most other robo-advisors by giving you total control over the investment process. Most robo-advisors only offer a few pre-build investment portfolio options to choose from. And most of the time, the only thing you can adjust is your stock/bond allocation.

With M1 Finance, investors have more options and greater flexibility.

With M1, you can choose of their expert-designed investment portfolio templates, which they refer to as “pies.” Or, if you’d prefer, you can customize your own pie to get exactly what you want. M1’s unlimited customization feature allows you to personalize your portfolio by selecting individual stocks and exchange-traded funds (ETFs).

Once you’ve designed your pie, M1 Finance will automatically purchase investments in the correct proportions, both when you initially fund your account and whenever you contribute additional funds.

Expert-Designed Pie Categories

M1 provides over 60 pre-built investment portfolios to choose from. No matter your financial objectives, you’ll almost certainly be able to find a pie that corresponding with your investing goals. Here are a few examples:

  • General Investing. Create a diversified portfolio that matches your personal risk tolerance
  • Plan for Retirement. Design a portfolio that adjusts to your goals as you age.
  • Responsible Investing. Select sound financial options while investing in socially responsible corporations.
  • Income Earners. Take a conservative approach to investing by focusing your portfolio on dividend and income returns.
  • Hedge Fund Followers. Emulate the investment strategies of successful hedge funds without the high management fees. 
  • Industries and Sectors. Invest directly in business and industry sectors that you believe in. 
  • Just Stocks and Bonds. Design your portfolio around the world’s two major asset classes, stocks and bonds.
  • Other Strategies. Choose from other expert-designed investment strategies to find an investment style that’s right for you.

Customizing Your Pie

You can also create a custom pie. Either start from scratch or customize one of M1 Finance’s pre-built portfolios.

m1 finance review

Each pie can have up to 100 slices that are made up of individual stocks, ETFs, or even other pies. With over 6,000 stocks and ETFs, there’s almost no limit to the ways you can diversify your portfolio.

This level of customization is possible because of M1’s use of fractional shares. Investing with fractional shares gives you more control over your investments so you can design each slice of pie exactly the way you want it. This means you’ll know that every dollar you contribute will be invested according to your personal investing plan!

Managing Your Portfolio

Once you’ve made your pie selections, M1 Finance will take over. Any time your account’s cash balance reaches $10, M1 will automatically purchase investments according to your selected allocations.

Dynamic Rebalancing

If you are a buy-and-hold investor, you’ll probably notice that your investment allocations will drift over time. That’s because certain assets will outperform other assets in your portfolio.

To ensure that your asset allocations remain in line with your chosen strategy, M1 Finance practices dynamic rebalancing. M1 does this by using new contributions and dividend deposits to bring underweighted asset classes back to the allocation levels you designated when you created your pie.

Tax Minimization

Unlike other leading robo-advisors, M1 Finance does not offer tax-loss harvesting. Instead, they offer a feature they call “Tax Minimization.” This strategy is designed to sell securities in a way that helps reduce the amount you owe in taxes.

In short, M1’s algorithm determines which securities to sell in order to minimize negative tax consequences. Many brokerages employ a simple “first in, first out” approach to selling securities. M1’s strategy prioritizes sales to first sell securities that will not result in tax liability, before selling securities that will result in long-term and/or short-term gains.

How to Open an Account with M1 Finance

Signing up for an account with M1 Finance is easy. Here’s how:

m1 finance review1. Create your Free Account.
All you need to do to sign up for your free account is register and create a password.

Right now, you’ll get $10 when you sign up and fund your account. Plus, if you refer a friend you’ll each get $10 to invest after your friend signs up and funds their account!

2. Build Your Portfolio
One nice thing about M1 Finance is that you can explore the platform and customize your investment portfolio before making your initial deposit. This is a great way to familiarize yourself with M1’s pie investing concept and discover all the options you have for customizing your own pie.

3. Create Your Brokerage Account
There are several types of accounts to choose from:

  • Taxable Investment Accounts
  • Roth IRA
  • Traditional IRA
  • Rollover IRA
  • Trust Account

4. Fund Your Account
To fund your brokerage account, you’ll need to link a bank account. There’s no minimum deposit required to open an account, but you’ll need at least $100 to begin investing.

After completing the sign-up process, it’s time to start browsing investments and selecting investments for your personalized portfolio.



M1 Finance is available for desktop and mobile app. The mobile app is available for both iOS and Android and has received favorable reviews for its user-friendly design.


  • 100% Free. M1 Finance doesn’t charge any broker fees, commissions, or account management fees.

  • No Minimum Initial Deposit. You can open your account with no money at all and start investing when your account balance reaches $100.

  • Fractional Shares. M1 Finance uses fractional shares to maintain your pie allocations. This means that your money is always fully invested instead of sitting on the sidelines.

  • Commission-Free Trading. There aren’t any fees for buying and selling securities, which means you can change your pie allocation whenever you want at no cost.

  • Handpick Your Investments. Unlike a traditional investing app or brokerage, Stash helps make investing relatable by renaming ETFs in a way that better reflects what you’re investing in.

  • Referral Bonus! Use our link to take advantage of M1’s sign up bonus! On top of that, you’ll get another $10 every time you refer a friend who signs up and they’ll get $10 too!


  • No Tax-Loss Harvesting. While M1 Finance has a “Tax Minimization” feature, it doesn’t carry the same benefits as tax-loss harvesting offered by more established robo-advisors.

  • Acclimating to “Pie” Investing. M1 Finance’s once-a-day batch trading process takes some getting used to. You can’t simply buy and sell like you can with most other investing platforms.


Is M1 Finance Right for You?

M1 Finance offers a level of portfolio customization that is unmatched by their robo-advisor counterparts. M1 also provides the automated portfolio management so you don’t have to worry about managing your account day-to-day. More importantly, the M1 Finance platform comes at a price that can’t be beat. When it comes to invest in individual stocks or ETFs, M1 is the cheapest player out there. Only Robinhood is in the same league when it comes to commission-free trading.

Honestly, M1 Finance is my robo-advisor of choice. They’ve already accomplished so much since launching in September 2016 that I can’t wait to see what other features and innovations they bring to the personal finance world down the road.

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About the Author:

Hi, I'm Cato! I'm an attorney with a passion for fantasy baseball, burritos, and investing! I also paid off over $86,000 in student loan debt in under four years while aggressively investing for my future. Please subscribe if you want to learn more about mastering your finances so you can live the life you want!

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