M1 FINANCE REVIEW 📈 Best Beginner's Investing Platform! in the next video.#Best Education Page #Online Earning

 So in this video here, we're going to be doing

a short review of the M1 Finance investing platform.

Now I already have done a review of this app

on my channel, but that was a close to 20-minute review,

and so maybe you don't have 20 minutes

and you're looking to
make a decision

on whether or not the M1 Finance app is or is not for you.

So we're gonna make sure this video is a lot more concise

and we're gonna get straight into the main points here

of what makes M1 Finance unique and what ultimately

makes this a brilliant investing platform.

Now most people out there, when they think

of these free investing platforms, think of Robinhood

because they are ultimately the most well-known

commission-free trading platform.

They kind of pioneered this new industry

of the commission-free stockbroker,

but now there are a number of different worthy competitors,

M1 finance being one of them, and we're gonna focus on

what M1 Finance offers the investor

that is above and beyond what you will find with Robinhood

and other free stock trading apps out there.

And at the end of this video, if you do decide

that you want to sign up for an M1 Finance account,

I do have a link down in the description below.

It is an affiliate link, you guys don't have to use it

if you don't want to.

But that being said, let's get right into the review here

and talk about the five biggest things

you need to know about M1 Finance.

Now a lot of these features and benefits offered

by M1 Finance are a bit difficult to explain,

so I'm going to be using my crafts that I made here

to better explain what M1 Finance is offering.

And number one, we're starting off with fractional shares.

M1 Finance is unique because it's allowing you

to buy fractional shares of stocks

like Amazon or General Electric, for example,

rather than having to buy whole shares of these stocks,

but you might not understand why exactly this is necessary.

But the reason behind this is a stock like Amazon

trades for around $1500 per share

while a stock like General Electric trades

for just $10 per share.

So this becomes a problem for investors

if you're looking to invest a small amount

of money in Amazon, you would ordinarily have to spend

at least enough to buy one whole share of that stock.

But M1 Finance allows you to own

and purchase a fraction of a share of a stock like Amazon

as little as one ten-thousandth of a share.

So instead of buying an entire share of a stock like Amazon,

you can buy a fraction of a share free of charge

through M1 Finance as little as one ten-thousandth

of a share, and this is ultimately going to make it easier

to get into high-barrier stocks like Amazon

and allow you to build a more well-diversified

and balanced portfolio.

The second thing you have to understand

about M1 Finance is that they are offering you

what is called pie-based investing.

So your portfolio is an investment pie with an M1 Finance.

So for example, we're looking at this small portfolio

I've created and we have some of my money in Amazon stock,

some of it's in Microsoft and Apple,

and then the Vanguard S&P 500 fund

and as you can see, 50% of my money is in Vanguard,

30% is Amazon, 10% is Microsoft, and 10% is Apple,

and again, thanks to those fractional shares,

I'm allowed to own a fraction of a share of Amazon

and a fraction of a share of Microsoft and Apple,

allowing me to have this well-diversified portfolio here

of tech stocks at a dollar value of just $100.

Now if you are not interested in building your own portfolio

from scratch, which a lot of people aren't,

you can take advantage of these M1 finance expert pies

as you can see here.

There are multiple different categories.

There are general investing, specific plans for retirement,

there are income earners, there are hedge fund followers,

or there's also allocations of just stocks and bonds

if you wanna keep it simple.

So let's go ahead and open hedge fund followers

just to give you guys an example.

You can replicate the strategies of Berkshire Hathaway

or Icahn Capital, for example,

without paying any fees to M1 Finance.

That is one of the most brilliant parts of this platform

is everything you're seeing here being offered to you

is being offered fee-free from M1 Finance.

They do not charge any fees.

And this is great, too, for retirement investors

because they have specific plans for retirement

where you can do a target-date fund,

where you simply put in the year you are looking to retire

and you can invest in a portfolio specifically designed

for that retirement goal.

So for example, a 2060 retirement, you could choose

between a 2060 aggressive, conservative,

or moderate portfolio, and each one of these will share

with you details about the holdings

as well as the performance of each of these funds.

So through M1 Finance, you can invest

in one of these expert pies.

They have over 80 of these, all kinds

of different types of investments,

or you can simply build your own portfolio from scratch

containing up to 100 individual stocks or ETFs.

Okay, so the third thing we need to understand here

about M1 Finance is that they are offering

what I would call a portfolio-level drip

or dividend reinvestment plan.

Now a lot of people may have no idea what a drip even is,

so let's start off by explaining what that is.

Well stocks like Apple, for example, pay quarterly dividends

and Apple pays a quarterly dividend of $0.73 per share.

So let's say, for example, you owned a thousand shares

of Apple, that means that you would be collecting

a quarterly dividend payment of $730.

Now what do you wanna do with that dividend payment?

Some people collect it in cash and they receive a check

in the mail, but other people decide

to reinvest that back into the stock.

That way you can own more Apple and ultimately experience

more growth and earn more dividends in the future,

allowing you to earn compound interest.

So if you took that $730 dividend payment

and reinvested it back into Apple stock that quarter,

you would have an additional 4.2 shares of Apple,

giving you a total of 1,004.2.

This is what you call a stock-level drip

or dividend reinvestment plan.

Now let's go ahead and explain what a portfolio-level drip

would look like with M1 finance and let's say, for example,

you had a portfolio of 1,000 shares of AT&T

and a thousand shares of Apple.

Well in M1 finance, your portfolio would look like this,

where 85% of your money was in Apple and 15% was in AT&T.

The reason behind that is Apple trades for around $170

per share, while AT&T trades for around $30 per share.

So when those 1,000 shares of Apple pay out

that same $0.73 dividend,

you're gonna have a $730 dividend payment

being reinvested back into this portfolio.

The difference being, $620.50 is going to go into Apple

and $109.50 is going to go into AT&T

because they're gonna put 15%

of that dividend into AT&T and 85% into Apple.

This is the difference between a stock-level dividend

reinvestment plan and a portfolio-level

dividend reinvestment plan,

where those dividends are going to be reinvested

across the entire portfolio according

to the allocations that you set.

The fourth thing you have to understand

about M1 Finance is that there are a lot

of built-in automation features,

and one of these is automated deposits

on a regular basis, so if you wanted to add $100 a week

or $100 a month to your M1 Finance account,

you could easily do that.

However, the other feature that is interesting here

for M1 Finance is the feature of automated rebalancing,

and this comes into effect

when you are looking to add more money to your portfolio

to balance it out back to where it should be.

So let's say, for example, you started off here

with a portfolio of 50% Apple stock and 50% Amazon stock.

This is what it would look like on day one

when you created that portfolio.

But let's say 30 days later,

you open up your M1 Finance account,

you're looking to add more money to it,

and you find that 46% of your money is in Apple

and 54% is in Amazon.

This is because stocks do not perform the same way

at the same time and you're going to experience

this drift within your portfolio and it's up to you

to rebalance this portfolio in most cases.

However, with M1 Finance, as you contribute more money

to this portfolio, you can rebalance your portfolio,

or you can simply log in and click a button to rebalance.

However, you don't want to be overdoing it

with the rebalancing because that could be causing

short-term capital gains within your account,

but if you are rebalancing by adding more money to it,

you wouldn't have to worry.

So if, for example, you were to put another $100

into this account, you would see more of this

going into Apple and less going into Amazon

to get you back to that level of 50/50

and getting back to those baseline numbers

you set up with your portfolio.

And then number five, the fifth thing worth mentioning here,

is that M1 Finance offers retirement accounts.

We already saw those when we opened up the app,

when I showed you guys those expert pies.

You can invest in these target date funds

or pretty much any M1 Finance investment

through a retirement account.

And the reason why this is such a big deal

is because they are the only free brokerage account

that I have come across that offers

these retirement accounts at this point in time.

Now if you're looking to open an account with M1 Finance,

there is a $100 minimum balance

to open a traditional account or a joint account.

And if you're looking to open up a retirement account,

it is going to be a $500 minimum balance.

Now beyond that, there are no fees

associated with M1 Finance.

They don't charge any kind of asset management fee.

There are no other strings attached

or hoops you have to jump through.

It is a very simple, easy to understand investing platform

that is geared towards the long-term investor.

Now retirement accounts in and of itself is a topic

for a completely different video.

I actually just recently did a video

on how you can become a tax-free millionaire

by using a Roth IRA, which is one of the accounts

offered by M1 Finance so I'm gonna link to that video

down in the description below

if you're looking to learn more.

But anyways, guys, that's gonna wrap up this video.

Those are the five biggest things

you need to know about M1 Finance.

If you guys are interested in opening an account with them,

like I said, I have an affiliate link

down in the description below if you want to use it

and help me out and support me

for putting this video together.

But thank you guys so much for watching this video.

I hope you enjoyed it and I will see you

in the next video.

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