Do you think about making investments, but you don’t know where to start?
Maybe you’re tired of getting low returns on your savings account, but you can’t decide where to put your money instead.
Or you hear about certain stocks taking off, but you wonder if it’s safe to buy them.
How can a newbie get started investing with little knowledge and limited funds?
M1 is a financial app that offers a great way to get started investing without needing to study the markets.
M1 Gets You Started Right Away
It’s easy to get started on M1, and you can start with small amounts. A minimum of $100 is all you need.
There are zero fees. You won’t pay commissions.
It’s free?
Yes, it’s free. M1 is a Robo-Advisor, and since it is automated and runs on algorithms, it is relatively cheap for the investment service to run.
(You can pay for some extras, but most beginners won’t need them.)
It’s like holding a stock brokerage and a bank in your hand, and after a few initial decisions, you can simply invest and watch your wealth grow over time.
You can take the guesswork out of investing by using an app that will offer you choices about how you invest.
How M1 Works
As the M1 website explains, you invest with Pies, their “intuitive, interactive dashboard.” Your account looks like a big circle, and you decide what slices go into your pie.
As you apply for an M1 account, you answer a few questions to set your priorities, and M1 will suggest some Expert Pies for you to invest in, so you can invest in stocks and bonds. You can choose aggressive, higher risk pies, or lower risk conservative pies.
You can choose pies based on a future date in time.
These pies include a bundle of assets that generally follow an index, and that means there is diversity and lower risk.
You can learn more about how M1 stacks up here: M1 Finance Review 2022
Invest in What Matters to You
You can invest in what matters to you with M1. You can invest in companies that are:
- Committed to Sustainability
There are M1 Community Pies that focus on groups of publicly traded companies led by executives who are:
- Black
- Female
- LGBTQ+
- Asian American and Pacific Islander
- Latino-Led.
Of course, there are investments based on market sectors.
- Tech
- Cannabis
- Dividend earners
You can set up automated monthly deposits and continue to invest without having to think about it. You can go as low as investing an additional $10 a month. Just keep building toward a wealthier future on schedule.
Customize Your Pie
You can go with suggested expert pies, or you can build your own pie if you want to.
You can decide what slices (investments) go into your pie. The plan is customizable, flexible, and you can easily change it.
If there is a particular stock you want, you can decide what fraction of the pie would be invested in it.
Fractional shares are available on M1, so if you always wanted to buy some stock that is high-priced per share, now you can do it. Before M1, you might need to save for months to buy a single share of Amazon or Google at thousands per share, but on M1 you can purchase fractional shares and get those investments working for you right away.
Additional Services
M1 also offers a checking account, debit card, and credit card, so in addition to investing, you can put all your financial eggs in one basket.
You can also borrow against a portion of your investments at super low rates.
The M1 app for your phone is user-friendly and offers a dark mode to be easy on the eyes. You can check on your investments, quickly and easily adjust the makeup of your pie.
Other Apps Offer Other Options
If you really want to be an active trader who keeps an eye on the market and follows particular stocks closely, then TD Ameritrade would be a good choice with their ThinkorSwim platform that makes tracking the market easy to do. It’s a great way to research investments and follow trends.
You can learn more about how the M1 and TD Ameritrade platforms stack up here: M1 Finance vs TD Ameritrade
Vanguard was founded back in 1975, and it has many advantages for the investor who has $50,000 or more to invest. Its funds tend to out-perform the competition. However, most first-time investors don’t start with that kind of cash.
But if you are one of those lucky ones, Vanguard has more account types than M1 and has live people to assist you to personalize portfolios according to your individual needs. You pay more for their services.
M1 offers choices and suggestions for pies and pieces to put in your pie, but it isn’t going to connect you to a person who is an expert to advise you. But if you don’t have huge piles of cash to invest, you won’t get in the door, so to speak, at Vanguard any time soon.
You can compare the two platforms here: M1 Finance vs Vanguard
The Wall Street Journal has an article entitled: Robo Advisers Target Young Adults Interested in ESG Investing. ESG refers to Environmental, Social, and Governance, or investments that reflect the values of the investor. They discuss how “these products can be useful to investors with limited funds,” and “Money-management firms are adding options to attract these customers, for whom investing even small amounts with an environmental, social or governance focus—while paying low fees—is a priority.” The article includes a brief overview of competing platforms.
M1 is the Best Choice for Beginning Investors
Of the investment apps, M1 has all the advantages for the beginning investor.
- Low initial investment of $100
- No fees
- Ease of choosing investment pies
- Options for investing with your values in mind
- Set up auto-transfers to invest every month
- Checking, debit, credit, borrowing are all available
Then you can read their blog and learn more about investing as you go.
You’ll be way ahead of that old savings account.