This Robo-Advisor Also Lets You Customize

For a lot of investors, the invention of robo-advisors has been somewhat of a revolution. Like in many areas of our lives, such as booking travel, expensive human advisors have driven up costs at the margins in ways big and small. But with the snowballing effect of technological advancement, these services have increasingly become automated at great savings to the end user. 

When it comes to money management in particular, many are hesitant to completely let go and leave it to the algorithms to figure out. That’s understandable – most of us work 40 hours a week (or more) for our money, and how effectively our investment gains compound over the years dictates our wealth (or lack of) later in life. As a result, a new crop of robo-advisors has emerged that lets you put as much of your investment strategy on auto pilot as you’d like, but also lets you retain the ability to customize your portfolio and even pick individual investments.

Perhaps the platform that best illustrates this balancing act is M1 Finance. While not a behemoth of the financial world like Vanguard or other decades old names, it has been in business since 2015 and now boasts more than $5 billion in assets under management (AUM). M1 Finance combines the best elements of automation and customization to let you be in as much control as you are comfortable with. It also takes some of the complexities of investing out of your hands – for example, its feature of automatically reinvesting dividends takes away some of the need for you to figure out dividend investing for yourself.

M1 Finance Review – Covering the Basics

Given its popularity among investors, it should come as no surprise that M1 Finance is talked about online quite a bit. There’s no sense re-inventing the wheel, so check out earlier reviews of the service to get a comprehensive overview. But at a high level, here’s what’s really great – there are no fees involved! That’s right, there are no management fees based on the overall size of your portfolio, and there are no commission fees for individual trades either. If you are an investor who has seen the impact that fees which may sound small can have on your portfolio’s value over time, you will no doubt appreciate how important this feature is.

Automatic… Customization?

Here is where M1 Finance really shines, catering to both investors who prefer to completely automate the management of their portfolio and those who want to be hands on. By deploying a tool known as ‘pies’, you can have as much or as little control over your portfolio as you would like. At a basic level, you can set an asset to be a pie that is a certain size of your portfolio – for example, stocks. From there, you can customize the individual ‘slices’ of the asset pie, by picking specific stocks and assigning them a weight within the pie. While making a pie from scratch yourself involves a high level of customization, another great option depending on your preferences is to select one of M1 Finance’s pre-designed pies that are oriented towards a particular investment goal – for instance, high growth stocks or high savings bonds. Another important thing to be aware of is that your M1 Finance account will be FDIC insured, offering a strong layer of protection.

The Rest of the Robo-Advisor World

It’s definitely the case that M1 Finance has a lot of competition in the robo-advisor space, so before taking the plunge with them you owe it to yourself to consider at least a few of the best known alternatives.


In the world of online investing, M1 Finance vs Betterment is a very common topic of discussion. It’s worth reading an in-depth review that compares all the features, but here’s the big picture: Betterment has more robust pre-designed portfolio options but allows for no customization and charges management fees. Depending on your membership level with Betterment, fees could be anywhere from 0.25% – 0.4%. Betterment users can pick between about 5-7 types of portfolio options based on certain investment strategies, but they are pre-designed and cannot be modified. Some of the portfolio options include socially responsible investing if that is something important to you. Overall, Betterment is geared towards those who prefer to be hands-off and have a large enough portfolio that they can stomach modest management fees.

TD Ameritrade

One of the older and better known investment platforms for regular every day retail investors, TD Ameritrade vs M1 Finance is a good point of comparison. Much like M1, TD Ameritrade offers the option of customizing your portfolio by making individual investments across most types of asset classes. They do also have a robo-advisor function, but it is more limited than M1 Finance’s options. All things considered, TD Ameritrade veers in the opposite direction of Betterment: it is aimed at investors who prefer to be very hands on and customize every aspect of their portfolio. 

Last Word: Is M1 Finance King of the Robo-World?

Before picking an investment platform, it is critical to do as much due diligence as possible – the smallest of details can make a big difference in your success. Quite frankly, if you are considering entering the stock investment world, you could do a lot worse than M1 Finance. The automation feature makes it much easier to work with than investing in real estate, for example, where rules on rental contracts can vary greatly across state lines. If you want robust service from a safe and trustworthy provider, M1 Finance is probably the place to start.

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