M1 Finance Review In-Depth 2020

M1 Finance is an automated investing platform that makes it easy to buy stocks and funds. They have automated features that allow you to deposit and buy stocks automatically, but also some unique portfolio building tools and the ability to actively manage your portfolio if you choose. 

I’ve been using it for my investments for a while, I initially explored all of the major robo-advisor competitors but settled on using M1 Finance, so I will report on what I’ve seen so far.

Is M1 Finance Safe?

M1 Finance is a member of the SIPC, Securities Investor Protection Corporation which means your account is insured up to $500,000. So if M1 Finance goes under, you still get your investment back. You can also check their FINRA profile which is clean at the moment, which indicates they are legitimate.

For my readers, I would recommend never putting your money in an online account that is uninsured. Your bank accounts should be FDIC insured and investment accounts SIPC insured.

Design and Interface

The website and mobile app both look pretty good and have similar features. Both are smooth and appealing, yet not distracting so you can focus on your investment portfolio.

They have smooth navigation at the top.

And they show your account value in bold letters at the top, and have an expandable graph that shows the trend of the dollars in your account.

Ease of Use

The platform has easy to understand portfolio building. You split your portfolio into slices of “pies” which can either be funds, stocks, or other pies. This way M1 Finance knows what to rebalance and when based on your pie allocations.

Not to worry if you’d rather be a super hands-off investor and are not necessarily confident in your picks. They have a nice selection of pre-built pies that you can add to your portfolio with low-risk mutual funds and index funds.

Your entire account automatically rebalances as cash enters your account or you hit a button that says rebalance. It fills out the pies according to how you slice it, so it is easy to stay perfectly balanced and diversified over time.

The navigation is simple, there won’t be distracting options and confusing jargon. I would say in terms of investing platforms that let you pick stocks, this is top of the pack in terms of ease of use.

What Trading Options Does M1 Finance Offer?

M1 Finance lacks some of the trading options of a traditional broker. You can’t set buy/sell orders based on a future price, you can’t short stocks, you can’t buy with leverage, and not all stocks on all exchanges are available for trading.

Realistically, this is because M1 Finance is not a platform built for day-traders, those who aim to make money on daily volatility of stocks.

Personally I’m trading with a weekly horizon meaning I’m willing to buy or sell stocks on a weekly basis depending on if they meet my investment criteria. I have metrics that I want all of my stocks to meet, and if they do not meet those metrics I kick them out of my pie.

M1 Finance does have access to all major stocks you’d want to buy in the US, and many mutual and index funds. In the current edition you won’t find small-cap international stocks.

While there are talks of margin/leverage investing in the future, M1 Finance currently does not offer any debt-financed-trading at the moment. However, you can buy leveraged mutual funds, which is a concept you’ll want to research before purchasing because there are some major downsides to them, but that is one way to leverage your investment apart from margin.

All-in-all, I’d say M1 Finance has the trading options necessary for the average investor and for myself, but definitely not for active day-traders.

Customer Service

So far I’ve asked questions of M1 Finance twice, and both times they answered super fast with helpful answers.

While I’ve never had any major issues to really test their customer service, I was pleased with their ability to answer complicated questions about how things work. They seem to care a lot about their users.

Special Features


M1 Finance Investment Porfolio Structure

M1 Finance uses a system of pies to structure your portfolio. The cool thing is you can have pies within pies if you want. Essentially, you can know exactly what percent of your portfolio will go into what investment strategy.

For instance, if I want to dedicate 20% of my portfolio to international growth stocks, I might select one of their premade Expert Pies and put it in at the top level with 20%. Then, I want the other 80% of my portfolio to be my own investment strategies. I would create a new pie and put that one at 80%.

Within that new pie I could have different pies going as well, and each of those pies could contain stocks, funds, or other pies.

The pie system keeps me reasonable in my choices, so instead of throwing chunks of money here or there, I have to decide how much I value different investing strategies or funds.

Fractional Shares

Did you know there is a stock in the US stock market priced over $250,000 per share? Good luck buying one of those, and if you are a richer person with eyes on that share, good luck buying it and staying efficiently diversified.

In M1 Finance you could buy that $250k stock, because they offer fractional shares. You could theoretically buy some fractions of that $250,000 share and maintain balance in your portfolio.

Even if you can afford whole shares, it is advantageous that all of your purchases will be done with fractional shares. This is to maintain perfect balance and diversification in your account and to ensure you have minimal excess cash sitting around.

Fractional Shares with M1 Finance

Notice my stock breakdown from one of my pies. Instead of whole shares, I own more precise amounts.

Automatic Deposit and Rebalance

Because M1 Finance works on that system of pies, they know exactly what to buy when you deposit cash. Most brokers just leave the cash sitting in your account if you deposit monthly unless you set up buy orders every month, but then there is no balancing.

As soon as your monthly deposit hits the M1 Finance system, it gets put into your investments in a way that balances it perfectly.

For instance, if your overall pie was 50% stock x and 50% stock y, and over time stock x grew into 51% of your portfolio while stock y became 49%. When you deposit cash into your account, it will deposit until stock y and stock x are both back at 50%.

The other way to rebalance is to click the rebalance button, which will trigger the system to sell in pies you are overexposed to and buy in pies you are underexposed automatically for you.

You could also just deposit chunks of cash, you don’t have to lock yourself into monthly deposits. But the fact that you theoretically could set up your account with some mutual funds and deposit stocks monthly means this is a fully automated system of investing.


M1 Finance gives you unlimited trades for $0 per trade. This is important if you take a more active approach to investing like me, because you don’t want to pay $5 per trade when you sometimes make 10 trades a day.

This puts M1 Finance at the front of the pack in terms of cost to use of any online investment platform, you can use their service without paying anything. Additional services will allegedly cost more to use, and they are working on additional features in 2020. I will update this review as those come out.

Overall I give M1 Finance 98%.

While they would points on trading options, they also never market themselves to day-traders and are clear on their website about what their trying to do with their platform. They really fulfill the needs of those who they do market themselves to and have passion for making the platform easy to use.

However, I deduct 2% from the score because there have been a few times where I wanted to buy stocks but they weren’t available because they had too low of a market cap or are not US based. Most of the time they have the stocks I want, so it isn’t a big deal. But if you plan on making a penny stock portfolio or an international portfolio, go somewhere else.

I’m sure more fringe-stocks will become available as M1 Finance grows and can make fractional shares of all of these other stocks.

Click to Start Investing with M1 Finance.

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  1. Just a heads up, Personal Capital now has an M1 Finance integration so that’s a plus for tracking.

    • Thanks, that is a huge plus. I submitted requests to both companies a few months back, hopefully other people did as well, and now I can track my investments with M1 Finance on Personal Capital as well.

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