M1 Finance 2-Year Review (The Good, The Bad, and The Rating)

m1 finance just might be the underdog of investing apps people talk a lot about robinhood weeble acorns public and a bunch of others while m1 finance quietly offers amazing features no fees and great design let's talk about what it's been like to use for the last two years and what i think about it a lot of things about the upper positive but i also have some frustrations so stick around till the end to see those first let's start with the good the design not only does it have great color tones it's attractive it's simple and it helps you think long term with your investing it actually takes a little bit of an extra step to see like a really short window of time like what's happened today or in the last week or so so i think that helps us to make better decisions long term because we're thinking more long term and we're not buying and selling all the time because statistically the people that trade more often most of the time do worse than the people who trade less often and that's just the math so don't get mad at me if you've made a bunch of money this year because of day trading good for you but overall the statistics don't lie the second positive thing is ease of use once you get acclimated to where everything is located in the app it is really really easy to use i personally think that one good test of a user interface is if you can open an app get done the task that you want to get done and then be out of the app all in a short period of time not a lot of distractions not a lot of wandering and m1 finance is good for that let's try it right now oh i got low battery let's open it up let's pretend like i wanted to check my activity no let's open it up and pretend like i wanted to invest some more money auto invest is turned off i'll deposit let's say 100 bucks from my bank account and let's invest it right now boom transfer the money's coming in hot like that new la cray song i don't even think it's that new done actually since i have auto invest turned off let's turn it back on and there we go so now first thing tomorrow that money's gonna be invested thanks for helping me invest an extra hundred bucks by making this video with you i also like that in that whole process that you just saw in that screen recording there's no distractions there's no headlines there's no big flashy like notification things to distract you it just lets you do what you want unlike some of the other options cough weeble cough robin hood cough public i'm not trying to spend all day on these apps i'm trying to invest and move on with my life third positive thing no fees or commissions this is a huge deal and there are still some people out there today who are paying for trades who are paying fees and i just don't think we need to anymore like there are some really great premium services out there maybe you love them maybe they help you invest by all means keep doing what you're doing but if you're gonna choose between the same features that either cost you money or don't it's pretty hard to justify paying money for something the other investing app that i've recommended the most is called acorns and that charges between one and five dollars per month but it's a much more sort of helpful design because they've tailored everything to make things super easy to explain it all for you and i think it's actually worth it i still pay the one dollar per month to use the app myself even though i have m1 finance and other apps that are totally free so don't feel bad if you're using acorns because i still think it's a good app but it's more like these apps that charge you fees or charge you a percentage of assets under management if you've got like an active manager working on your stuff that's the kind of thing that makes no sense to me the fourth good feature easy to share pies and no this isn't strawberry rhubarb unfortunately also leave a comment below what's better pies or cakes there's one right answer here and let's see if you get it right because one dessert is definitely better than the other but m1 finance isn't talking about dessert it's talking about the way they display your portfolio so whenever you pull up your account with m1 finance what they do is they show you how much of each thing you're invested in in that account in a percentage format just in a big pie chart so if you were invested in two things of equal quantity 50 50 it would just be a pie chart with a line down the middle if you're invested in a bunch of stuff like i am it's going to be all fractured out and kind of show you the percentage of each thing and it helps you to sort of stick to that plan if you will long term so it's not just like weeble or robin hood or some other apps where it's like a big list of your investments without any regard to like the proportion of each one this is sort of assuming that you like have a plan in mind what you want your portfolio to be made up of and they make these pies really easy to share so if you want to you can use expert pies from their people but you can also just use pies from somebody else so for example i'll put the pie that i'm using right now for my sep ira in the description actually better than that i'll put it in the top comment i'll pin the top comment say this is my current pie for my sep ira and you can click on it right there see what i'm investing in right now in my latest account and you can even start investing in the same things if you wanted to this is not financial advice this is just for funsies from one friend to another sharing you what i'm doing but it makes that process super easy the next good thing about m1 finance is called a money weighted return a lot of investing services show you what's called a time weighted return what that means is it's a very simple version of showing you your return divided by the total amount you have invested m1 finance is the only investing service that i know of and currently use that does something different than that and what it does differently is show you your return with every individual movement sort of frozen in time to show you the significance of that instead of just overall that sounded confusing so let's go over an example let's say you invest a thousand dollars at the beginning of the year over the course of the year it grows ten percent and now you have one thousand one hundred dollars so now let's say you wanna invest more and you send in another thousand dollars at the beginning of the next year now the total you've invested is two thousand dollars but your return is still that same one hundred dollars from before other investing apps would now say that your return went from a ten percent return down to a 5 return but instead of saying that m1 finance would still say you made a 10 return so what it's doing is kind of locking in the truth of what your percentage was at that time and showing you that despite what your current overall balance is i'm obviously not a statistical genius or savant or great explaining this but to me that makes more sense because i really did make the 10 return even though i invested more money now it shouldn't cut into my return when i really think about it that's not helping me to understand how good my investments are doing so all that to say i just prefer the way that m1 communicates that another positive feature of m1 is called spend and this is their like checking account and debit card that they offer and i've been using it for a little while now and i really like it it's shockingly good as far as banks in 2021 go whenever you use the m1 finance debit card you get one percent cash back and the balance that you have in the checking account also gets one percent cash back which is actually really good for a debit card and it's not like it's my primary form of payment or anything but i like having it and i like having that cash earn a higher balance than i do at our normal bank another positive trait is just how easy it is to open accounts with m1 finance and i recently tested that out by opening an sep ira i knew i wanted to open an sap ira and when i looked through my phone and i had all the options of investing apps to choose i went right to m1 i just knew it was going to be the easiest and smoothest process and it was just as easy as starting any other account with m1 you literally just click add account choose an scp ira and you're off to the races it is super fast and if you're not familiar with an sap ira i'll go over it really quickly it's a specific retirement account that your employer can contribute money to and because i'm technically self-employed here on youtube i can contribute money for myself and the whole system works so the benefit of the scp really is that you can send in a lot more money than you can with a normal ira a normal ira is limited to six thousand dollars per year which is good but if you really want to get serious about retiring early or building wealth you need to send in more than that so an sep ira lets you contribute the lesser of either 25 of your total income or 58 000 that's pretty amazing the next two features are potentially positive for you if you're looking for it i don't think they're mandatory i think that they're handy if you really are looking for it but they're completely easy to pass on if not the first is called borrow and it's money that you can essentially borrow from m1 to do whatever you want with it doesn't have to just be investing it could be to go start a business or buy a really snazzy new camera or refrigerator or whatever you need it's just a line of credit from them to do whatever you want with to be eligible to access it you have to have at least five thousand dollars invested with m1 because they kind of use that as collateral for what you're borrowing then you can borrow up to 35 of whatever you do have invested and use it for whatever you want pay down that debt buy yourself a steak dinner do whatever you like and m1's website claims there is no extra application no payment schedule and it's only three clicks to activate and since i had to try it out for the sake of this video it really was it was very easy to set up i will give them that it was super quick super easy because i already had other accounts with them they already had all my info it was super simple the next feature that's potentially positive is m1's premium account it's called m1 plus and it basically just gives you a handful of more features over and above m1 basic which is free so you can use m1 finance do your investing do your trading do whatever all for free unless you want these specific things in which case you'd pay 125 a year but at least for right now the first year is free so if you're like me you're gonna take free stuff if it's given to you hey you can even try all these out for free to compare what you get between the free account and the paid account i'll put both up on the screen right now so you can see so m1 basic is the free one and you get zero trading commissions you can invest you can use borrow their line of credit thing but it's at a higher rate it's at 3.5 percent you got to have the 5 000 invested like i said and you can use spend so you get a free digital checking account atm fee reimbursement i don't know who uses atms anymore yadda yadda m1 plus is here on the right side of the screen and this is the additional features that you get with that you get an extra trade window which is am or pm now you get smart transfers custodial accounts for kids if you like that a cheaper borrow rate at only two percent and with spend you earn the one percent interest on the money you have deposited you get one percent cash back and you get some fees and things reimbursed and a cool card design so it's not a ton of features you'd probably have to really care about that stuff to end up paying for it but like i said you get the first year for free so may as well try it out if you have an m1 account right now overall there are a lot of really good things about m1 finance but now it's time for the not so good things for me oddly enough the application process to get a spend account was kind of a headache it was not very streamlined and it actually took me a couple of weeks to get approved somehow there was a problem with my social security number and the only way that they could verify it was with verification of a w-2 with my full social security number on it or a picture of my social security card so i don't even know where my social security card is it's probably here somewhere and i looked on my most recent w-2s and there was just a partial number so it took me a long time to track down a really old w-2 that still had my name on it and my full entire social so i could send it to them and get it approved i actually went back and forth with customer service a little bit on this and they didn't budge there's no other way for them to do this allegedly but through one of those two forms so that was a little frustrating especially because i already had three accounts with them so how do they not know who i am like what difference does it make if i'm investing with you versus if i want this spend account apparently there's a difference apparently banking and investing have different regulations so i accept that but the whole process was a little bit clunky speaking of clunky and speaking of their spend they don't have a digital wallet so in your phone nowadays you can have a lot of like credit cards and stuff just in there they can be stored and you can do shopping without the physical card it's super handy i like a digital wallet i don't use it all the time but every now and then i do so i had recently gotten this m1 debit card i wanted to order some pizza to pick up on the way home full disclosure and i couldn't there was no way for me to use the card without physically having the card i couldn't look up the card numbers anywhere and it seems like a really easy thing to just like add a feature where you could say click show card numbers but apparently it's not a thing i also contacted m1 to ask about this and they confirmed yes there is no digital wallet and they didn't mention any possibility of in the future so it's kind of odd because why wouldn't you have that in 2021 but they also did something else really kind of odd to me recently which was adding a send check feature so if you're if you're in 2021 you have an m1 account and you've been going man you know what i really want to do send a check to somebody well now you can like as of today the day i'm filming this june 7th you can just send a check from your account who was asking for this i don't know but now you have it another slightly negative thing about m1 is initially just getting used to the design because for me somehow i was thinking that whenever you open an account that all of the sort of actions you would take in that account would be on that primary screen but what you have to do is click on that kind of hamburger on the top left corner and go back to portfolio activity holdings or funding history to be able to get into some of some of those other actions and so to me that was a little bit illogical at first because i kept thinking well i'm in the account why am i clicking manage pi and i can't find the things that i'm trying to look for here so that's just me that was a problem that i had that took me some getting used to oh yeah i have to go back to that little hamburger kind of settings thing and find what i'm looking for there not a huge deal but initially because m1 is so unique in the way they've designed their pies and the app in general it does take some getting used to another quirk that i know a lot of people really don't like because i've had people comment hey i really don't like this about m1 finance is those trade windows so i mentioned that before what this means is that you're under no illusions that whenever you hit buy it's actually going to do that right now it's only during a little portion of time that they actually do your trades so it kind of reminds me like whenever you go to the post office and there's like the little sticker that says when they come and pick up the mail it's sort of like that with m1 you say like hey i want to invest this like put your envelope in the slot and then they're going to come by tomorrow morning and they're going to pick up the mail and they're gonna go invest it for you it's like it's not as immediate as some of the other apps so i assume some other people think like they're missing out somehow because they really wanted to invest right now like now is the perfect time i've decided i want to do it lock it in baby and they just don't lock it in they're a little more relaxed about it i think more than anything it's just sort of annoying and it shouldn't impact your overall investment strategy because if you're day trading this is not the app for you this is a long-term perspective much more mellow kind of styled app and so day trading belongs elsewhere so it really shouldn't matter to us but if i'm honest i'm a little annoyed by it too if i hit by just buy it just do it right now but it doesn't really work like that so i'm okay with it i'm gonna still use it it's just a little bit annoying i was inspired in making this video to kind of create a spreadsheet where i assess an investing app and i have these different categories to tell whether or not i think it's good and kind of give it an overall score i do this with a buddy right now whenever we go to a bagel place and we literally rate bagels in a spreadsheet based on like the cream cheese texture and how good the bite on the outside of the bagel is and stuff like that doug demuro does it here on youtube whenever he assesses a car he gives it a dug score so i'm a nerd like that i like an extra spreadsheet so i made kind of a brendon score for m1 finance and the categories that i'll use to kind of assess the app are cost ease of use features and services thoughtful or helpful design beauty extra or paid services i'll deduct points for any glaring faults or negativities and then finally an overall score so let's rate m1 finance on this new app rating spreadsheet that i made i've used it now for two years for cost i gave it a 20 out of 20 because it's free and even their paid service is free for the first year so there's nothing to pay for here for at least a year of use which is great for ease of use i gave it a 17 out of 20. for features and services i gave it a 19 out of 20. it's almost perfect i don't have anything else i'm looking for that i would like to have here personally thoughtful or helpful design is a 7 out of 10. very good for beauty i gave it an 8 out of 10. i really love the color tones of this app and the way that the kind of animations work it looks really nice for extra or paid services over and above anything for free i gave it an 8 because it's got some decent features here that i could see being really appealing they're competitively priced overall it's very good i don't see any big glaring terrible faults here to give any negative scores and overall i gave the app an 8 out of 10. and the total is an 87. so with a lot of time spent with a lot of different apps two years spent with m1 over 30 000 invested is m1 number one yes thank you so much for being here thanks to all my new subscribers if you're not yet subscribed please do me a favor and hit that subscribe button so you don't miss future uploads that helps me out a ton along with the like button so i appreciate that so much if you want to get started with m1 today i've got links in the description for that and i've also got a link to a video right here all about acorns so if you just watch this about m1 and you want to see the differences and kind of compare my review with acorns here it is and also here's another video that youtube thinks you would like alright see you guys thanks for watching bye

Channel: Brendan Evan

Views: 21,830

Keywords: M1 finance review

Id: F9sDWrxbLfo

Length: 15min 59sec (959 seconds)

Published: Sat Jun 12 2021