June 27, 2022

M1 Finance Alternatives

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M1 Finance is a popular app for fee-free investing. But is there a better option for you? Find out in this detailed guide to M1 Finance alternatives.

There's a lot to be said in favor of opening an account with M1 Finance. It's a beginner-friendly investing platform — offering a unique mix of control and guidance.

For investors who like to manage their portfolios, M1 allows for a high level of customization. You can invest in more than 6000 individual stocks and ETFs.

And for investors who prefer to take their hands off the wheel and let someone else drive, there are 80-plus prebuilt portfolios. You select your desired allocations. Then, set up recurring investments and your portfolio will nearly run itself.

But M1 Finance isn't perfect. Nor is it right for every investor.

M1's limit of one trade per day means that it's a good choice for buy-and-hold investors. But more active traders will likely find it lacking.

Nor does it have much in the way of research tools. And there aren't live, human advisors, which some investors will prefer.

If you're considering an M1 Finance account, but haven't made up your mind, this article looks at the best M1 Finance alternatives. After reading, you'll have all the facts, so you can start confidently investing today.

Let's dive in.

What is M1 Finance?

M1 Finance is a stock and ETF investing platform targeted at long-term investors who want a mix of guidance and freedom when managing their portfolios.

M1 offers a range of features, including:

  • Robo-managed and curated portfolios
  • An online bank account that comes with a free debit card
  • A lending service that allows users to borrow against the value of their investments

You can start investing with as little as $100, or $500 for retirement accounts, invest in fractional shares of stocks, and take advantage of automatic rebalancing.

However, M1 is missing some helpful features as well.

  • They don't have any human advisors.
  • They don't offer tax-loss harvesting.
  • They limit trades to one per day.

You can start investing by creating "Pies," which are selections of investments made up of over 6,000 available stocks and ETFs. This gives you more freedom than you would have with a typical robo-advisor, which would choose your investments automatically.

M1 basic accounts are largely fee-free, though they will charge for wire transfers and account statements. There is also an inactivity fee for accounts with less than $20 if there have been no trades for 90+ days.

Fun Fact: Today, we take it for granted that we can trade stocks for very low fees. But that wasn't always the case. Before the internet, full-service brokers could charge 2.5% per trade.

An M1 premium account is $125 per year and provides a second trading window to accounts over $25,000, interest on your account balance, cash back on debit purchases, and lower rates from the M1 Borrow service.

But it's worth noting that some of the alternatives below offer these services for free.

M1 Finance Alternatives

Now that we have a solid grasp of what M1 Finance is and what services they offer, let's look at its top competitors.

These M1 Finance alternatives are other platforms offering similar services that you might be interested in if you're considering opening an account with M1 Finance.

Let's jump in and see how they compare.

Robinhood: Best for Beginners

Robinhood is a popular commission-free stock and cryptocurrency investing app where you can trade ETFs and options as well.

It is known for being particularly beginner-friendly and has provided many new traders with an easy on-ramp into the world of investing. Users can trade fractional shares of stocks commission-free, with no minimums, and extended trading hours.

Robinhood's simplicity is both its strength and its weakness. It lacks research tools and alternative account types, such as IRAs, which are available at many of its competitors.

This helps prevent new users from being overwhelmed, but can also lead them to seek other platforms once they realize what they're missing elsewhere. For more long-term investments, we have some other great options for you.

Main Features:

  • Stock, cryptocurrency, ETF, and option trading
  • Commission-free trading
  • Beginner-friendly app

Vanguard: Best for Long-Term Investors

Vanguard is a well-known brokerage best suited to buy-and-hold traders, as its commission structure can prove costly to more active investors.

Vanguard offers stocks, mutual funds, and ETFs, with a fee structure that favors long-term investors as well as high net worth individuals.

To that end, they offer a range of tax-advantaged accounts including IRAs, 529 savings plans, annuities, and a range of small business retirement plans such as 401(k)s and SIMPLE IRAs.

Where Vanguard is lacking is in its research tools and features targeted toward frequent traders. But up next there is an option that active traders will love.

Main Features:

  • Stock, mutual fund, options, and ETF trading
  • Retirement and other tax-advantaged accounts
  • Commission-free trading
  • No account minimums

Schwab: Best Customer Support

Charles Schwab is one of the older names in trading, offering a wide range of investments including stocks, bonds, ETFs, mutual funds, options, and futures.

Like M1 Finance, stock trades are commission-free and there are no account minimums. But Charles Schwab is unique in that it offers separate platforms for beginner and advanced traders, with extensive research tools available.

Charles Schwab stands out from its competitors in terms of customer service and support, with 24/7 online or phone access in addition to email. There are also over 300 physical branches available to provide in-person assistance.

The drawbacks to using Schwab are the $5,000 minimum for its robo-advisor and its high commission on transaction-fee fund trades.[1]

Main Features:

  • Stock, bond, ETF, mutual fund, option, and futures trading
  • Commission-free stock trading
  • 24/7 support
  • No account minimums
  • Beginner and Advanced platforms
  • 300 physical branches
  • Robo-advisor

Webull: Best for Active Traders

Webull is a major Robinhood competitor and offers a more advanced platform that will appeal to more experienced investors, with a full suite of research tools and analytics. Another area where M1 Finance lacks as well.

Unlike M1, which offers a mix of features for both new and experienced traders, Webull is primarily geared toward active traders, swing traders, short-sellers, and margin traders.

With commission-free trading and no account minimums, frequent traders have a lot to gain from opening an account with Webull.

However, its platform may prove overwhelming for traders still learning the ropes. They also don't offer the entire range of services that you'd find at more established companies.

But the next brokerage on the list has everything you'd need in one place.

Main Features:

  • Stock, ETF, option, and cryptocurrency trading
  • Commission-free trading
  • Retirement accounts
  • IPO trading
  • Advanced research tools
  • No account minimums

E*TRADE: Best Full-Service Brokerage

E*Trade is an investing platform that offers a lot in one easy-to-use place, which can be valuable for those investors feeling cluttered and confused with multiple financial accounts.

On E*Trade, users can trade stocks, bonds, mutual funds, and ETFs. You can open checking accounts, retirement investing accounts, and even apply for home loans.

They also provide an advanced selection of research tools for everyone, with even more sophisticated tools available to traders who accrue more than 30 trades per quarter.

Main Features:

  • Stock, bond, mutual fund, and ETF trading
  • Commission-free trading
  • Home loans
  • IRA accounts
  • Checking accounts

Fidelity: Best for Advanced Traders or Beginners

Fidelity is a trading platform that offers excellent services for traders who are either very active, or very new, but doesn't perform so well for those in between.

They offer most investment products including stocks, ETFs, mutual funds, options, and bonds trading, as well as CDs. Users can open IRA and 529 savings accounts, and stock trading is commission-free. There are also advanced research tools.

While Fidelity offers many brokerage services to meet the needs of inexperienced investors, some services require a minimum number of trades per year which wouldn't work for many buy-and-hold investors.

Main Features:

  • Stock, ETF, mutual fund, options, and bonds trading
  • CDs
  • Commission-free trading
  • Tax-advantaged investment accounts
  • Research tools

TD Ameritrade: Best for Research

TD Ameritrade is a long-running online brokerage where users can trade stocks and ETFs, as well as options, which M1 Finance doesn't offer.

It's commission-free and known for its powerful thinkorswim platform, which has advanced research tools such as heat maps, backtesting, and more. TD Ameritrade's research capabilities make it a better choice for the investor who wants to research within their trading app since M1 doesn't offer much in the way of research.

TD Ameritrade also has no minimum deposit,[2] which means you can start investing with as much as you can afford.

The drawback to using TD Ameritrade is that some users may find it confusing to navigate. It has multiple distinct apps, and the tools that will be valuable to experienced investors make it harder to use for beginners.

Main Features:

  • Stock, option, and ETF trading
  • Commission-free trading
  • thinkorswim platform
  • Research tools
  • Paper trading account

Bottom Line

If you're looking for a flexible mix of automation and customization, and don't mind the daily trade limit, then M1 Finance may be the right platform for you.

You have the option to select pre-built portfolios, automate recurring trades, and it automatically rebalances your portfolio over time.

But if you want access to research tools, human advisors, more frequent trading, or a wider range of assets or accounts, then consider instead one of the many excellent M1 Finance alternatives.

References

  1. ^ Charles Schwab. Investment Management Fees and Minimums, Retrieved 6/5/2022
  2. ^ TD Ameritrade. FAQs: What is the minimum amount required to open an account?, Retrieved 6/5/2022
M1 Finance

Commission Free Stock Trading

M1 Finance allows investors the choice of ETFs and stocks. M1 charges no management fees or commission.

Betterment

Get up to 1 Year Managed Free

New Betterment customers only. Accounts must be funded within 45 days of signup. Terms apply.

Webull

Get Two Free Stocks, Each Valued Between $3 - $300

Expires 8/31/2022

Open a Webull brokerage account and get two free stocks, each valued between $3-$300

Jeremy Harshman is a creative assistant at CreditDonkey, a personal finance comparison and reviews website. Write to Jeremy Harshman at jeremy.harshman@creditdonkey.com. Follow us on Twitter and Facebook for our latest posts.

Note: This website is made possible through financial relationships with some of the products and services mentioned on this site. We may receive compensation if you shop through links in our content. You do not have to use our links, but you help support CreditDonkey if you do.

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