Managing your finances and building wealth can feel overwhelming as a beginner. There‘s so much complex terminology and investment products out there. Where do you even start?
I‘ve got great news for you – the M1 Finance app makes getting started with investing simple. M1 provides the perfect introduction to growing your money.
After testing and researching M1 Finance extensively, I‘m confident it‘s the best investing platform specifically for total beginners. With this hands-on guide, you‘ll learn how M1 works and why it‘s great for first-time investors. Let‘s dive in!
What Exactly is M1 Finance?
M1 Finance is an investing app helping newcomers learn to grow their wealth in the stock market. It‘s available as a web and mobile app.
M1 aims to make building a portfolio extremely straightforward, even if you have zero experience. The app provides educational resources, premade portfolios, and intuitive tools to guide you step-by-step.
Specifically, M1 enables you to:
- Invest in stocks, ETFs, bonds, and funds
- Automate hands-off investing on autopilot
- Build fully customized portfolios aligned to your goals
- Get started with any budget – minimums are $100 or $500 for IRAs
Over 1.5 million people trust M1 Finance to manage over $3 billion in assets. It‘s valued at over $1.45 billion dollars.
M1 Finance is a SEC registered investment advisor driving its rapid growth. The app has received glowing reviews from Barron‘s, The Wall Street Journal, Bloomberg, and more.
Why M1 Finance is Perfect For Beginners
As a beginner, the world of investing can seem complex and intimidating. You may not know where to begin or who to trust.
M1 Finance is tailored specifically for first-time investors like you. Here are the top reasons it stands out:
Easy to Use Platform
Everything about M1 Finance is designed for simplicity and ease of use. The web and mobile apps are intuitive with a clean interface. You don‘t need any prior investing experience.
Abundant Educational Resources
M1 provides investing tips, definitions, and guides directly in the app. You‘ll learn as you go with their step-by-step walkthroughs.
Premade Expert Pies
Skip building a portfolio from scratch. M1‘s expert pies provide recommended portfolios for any goal. Just select one and customize it.
Automated Hands-Off Investing
Set up scheduled deposits and let M1 automatically invest for you. Perfect for passive investors.
Open an account and begin investing with just $100. Most brokerages require $500 or more.
M1 offers phone support, email support, chat support, and a full library of help articles.
M1 has no management fees and $0 commissions. You keep more returns.
The bottom line – M1 Finance offers the perfect, friendly introduction to investing for newcomers. The app excels at simplifying concepts through education, smart automation, intuitive design, and personal support.
How M1 Finance Works
M1 Finance streamlines investing into a simple process accessible to anyone. Follow these steps:
Step 1) Open Your Account
Visit the M1 Finance website or download the iOS/Android app to open your account. The process takes just minutes.
You can open individual, joint, IRA, or trust accounts. The minimum to get started is $100.
Step 2) Fund Your Account
Connect your checking account to transfer money into your M1 account. I recommend setting up recurring automatic deposits if possible.
Step 3) Build Your Portfolio
Here comes the fun part – selecting investments! You can choose individual stocks, funds, ETFs or pick an expert pie.
Expert pies provide premade portfolios created by professionals. Pick one aligned to your goals.
Step 4) Set Your Strategy
Select your risk tolerance and set up automated investing schedules if desired. M1 will handle the rest.
Step 5) Monitor Performance
Watch your money grow! The dashboard provides transparent reports on your balances, gains, dividends, and more.
Step 6) Withdraw Funds
Transfer money back to your connected bank account anytime you want. M1 makes it seamless.
That‘s the basics! M1 Finance handles all the investing work in the background. Now let‘s explore some of the platform‘s standout features for beginners.
Key Features and Tools For Beginners
Account Setup in Minutes
Opening a new account with M1 Finance takes less than 5 minutes online or through their app.
You simply need to provide some personal details and connect a bank account. The $100 minimum gets you started.
M1 supports individual taxable accounts, traditional IRAs, Roth IRAs, SEP IRAs, and joint accounts. You can also open a trust account.
I love how quick and easy it is to open an account and fund it. M1 lets you begin investing in no time.
Goal Planning Tools
Reaching financial goals like retirement requires planning. M1 Finance provides goal planning tools to map out your targets.
You can project your target retirement income, then reverse engineer how much to invest each month to reach that goal. Additional goal categories include:
- Buying a house
- Paying off debt
- Building an emergency fund
- Saving for education
Setting up clear goals is motivating and keeps you focused on where your money is going. M1‘s planning tools make it easy.
Premade Expert Pies
One of my favorite parts of M1 Finance is the expert pies. These provide premade portfolios crafted by financial professionals.
Expert pies give you a shortcut to an automatically diversified portfolio aligned to a goal like:
- Socially responsible investing
- Dividend income
- And more…
Over 60 expert pies are available. You can invest in one instantly or customize it by tweaking holdings.
Expert pies are perfect if you feel overwhelmed by portfolio creation. Let the professionals handle it!
Automated Investing Made Easy
Once your portfolio is constructed, you can sit back and let M1 Finance automate the investing process through features like:
Recurring transfers – Schedule automatic transfers from your bank account to fund your investments on autopilot. You can set up daily, weekly, bi-weekly, or monthly transfers.
Automated rebalancing – As some investments outperform, rebalancing realigns your portfolio back to your target asset allocation. M1 handles this automatically.
Customized trading windows – Specify time windows where M1 can trade on your behalf to execute recurring investments and rebalancing.
Hands-off investing is a breeze. M1 Finance does the work of automating and optimizing your portfolio over time.
Intuitive Mobile App
M1 Finance offers full-featured iOS and Android apps so you can invest on the go.
You can easily:
- Check your portfolio balance and performance
- Monitor news on your holdings
- Initiate deposits and withdrawals
- Adjust your portfolio
- Chat with customer support
The mobile experience is seamless. I love having access to my investments in M1 anytime, anywhere.
Valuable Investment Education
M1 Finance helps you learn investing basics right within its platform through:
This walkthrough covers core topics like building a portfolio, asset classes, dollar cost averaging, dividends, and more. Perfect for gaining an overview.
Not sure what a term means? Look it up in M1‘s dictionary of over 200 definitions to build your finance vocabulary.
Investing Ideas and Tips
Browse short articles and videos with creative investing ideas, tips for choosing investments, retirement advice, and additional guidance.
Gaining knowledge is critical with investing. M1 Finance provides helpful education so you can make informed decisions.
Unique Features of M1 Finance
Beyond its great basics for beginners, M1 Finance has some industry-leading features that power users love:
M1‘s "pies" allow you to build a custom portfolio with fractional share investing. You can set up one or multiple pies.
Each pie represents a segment of your total portfolio, like "Growth Stocks" or "Healthcare". You customize each pie by adding "slices" for stocks or funds you want to own.
Pies make portfolio creation visual and intuitive!
Custom Stock Analysis
M1 Plus members unlock an powerful stock research tool called Analysis.
Analysis generates a 30-page report on any stock instantly. The report provides:
- Financial metric analysis
- Management bios
- Competitor comparison
- News sentiment
- Earnings forecasts
- Technical and fundamental analysis
- Investment ratings
Stock Analysis condenses hours of research into an easy-to-digest report.
M1 Borrow Credit Line
M1 Borrow provides a credit line using your portfolio value as collateral. You can access up to 35% of your account value at low rates.
This flexible borrowing option lets you leverage funds as needed for large purchases, business investments, and more. The rate is very competitive starting at just 3.5% currently.
Borrowing against your portfolio is much more cost-effective than alternatives like credit cards or personal loans. It‘s an innovative feature only M1 Finance offers.
What Does M1 Finance Cost?
M1 Finance is completely free to use for basic investing needs. Their zero-fee model is perfect for beginners.
Here‘s a breakdown of what M1 Finance costs:
- Account minimum – $0
- Management fees – $0
- Commissions – $0 for stock, ETF, and fund trades
- Account fees – $0
- Transfer fees – $0 for ACH transfers ($10 for wires)
- Inactive fees – $0
The only fee is if you choose to upgrade to an M1 Plus membership. This unlocks premium features and costs $125 per year. M1 Plus is optional – the basic service is free.
M1 generates revenue through interest on cash balances, M1 Plus fees, and payment from brokers who execute trades. But you won‘t pay any direct fees.
Is M1 Finance Safe and Legit?
Safety is a common concern for new investors. Here are a few reasons why M1 Finance is a legitimate and secure platform:
M1 Finance is a SEC-registered investment advisor, legally bound to act in clients‘ best interests.
User accounts are protected by SIPC insurance up to $500,000 in securities and $250,000 in cash.
M1 Finance partners with Apex Clearing Corporation to custody all funds and securities. Apex handles over $1 trillion in assets securely.
No history of any security breaches has been reported.
M1 has strong data encryption and protection per their security policy.
Biometric authentication helps secure mobile app access via fingerprint or facial recognition.
M1‘s executive team and investors include well-known financial institutions like Goldman Sachs.
After thoroughly evaluating their security policies, independent audits, and operations, I‘m confident M1 Finance provides a safe and legitimate investing platform.
Who Is M1 Best Suited For?
M1 Finance is a fantastic choice for:
Beginner investors – total novices will benefit most from M1‘s educational resources and simple approach.
Passive investors – hands-off automation makes M1 ideal for passive buy-and-hold strategies.
Retirement savers – tax-advantaged IRA accounts and target date pies simplify retirement investing.
Smaller portfolios – $0 fees and fractional shares are cost-efficient for accounts under $100k.
ESG investors – M1 offers 30+ expert pies for socially responsible impact investing.
M1 isn‘t the best fit for active traders or sophisticated investors. But for most first-time investors, M1 Finance offers an ideal place to start your wealth-building journey.
Pros and Cons of M1 Finance
Let‘s summarize the top advantages and potential drawbacks:
- Extremely easy to use, great for beginners
- Abundant educational content and guides
- Wide selection of expert pies provide turnkey portfolios
- Automated hands-off investing options
- $0 fees and low minimums
- Great mobile app and seamless experience
- Limited investment selection – no options, futures, or foreign stocks
- Minimal screening and research tools
- No access to human financial advisors
- Limited tax-loss harvesting
While M1 Finance isn‘t a full-service broker, its focus on simplicity and ease of use for passive investors make it an excellent choice for novices.
Let me leave you with some key takeaways:
M1 Finance provides the perfect introduction to investing by simplifying concepts and automating processes.
With easy account setup, expert pies, and an intuitive app, M1 makes building wealth approachable for total beginners.
Hands-off investors can automate their strategy while still maintaining control and transparency.
M1 Plus unlocks powerful enhancements, but the core service is free. Costs are ultra-low.
While not a full brokerage, M1 delivers an ideal experience for investing newcomers.
If you‘re eager to get started growing your money but don‘t know where to begin, I highly recommend giving M1 Finance a try.
No investment platform makes investing more friendly and accessible for first-time investors. With M1, you can put your money to work and pave the path to financial freedom.
Let me know if you have any other questions! I‘m happy to help you get started. Here‘s to growing your wealth stress-free.