M1 Finance vs Acorns | Best Investing App For 2020 #Best Education Page #Online Earning

- So in this video today we're going to be talking about

the two investing apps out there known as M1 Finance

and Acorns and kind of comparing these two different apps

out there to help you understand which one may be

a better fit for you in terms of your investing.

Now at the end of this video if you guys do decide

that you wanna open up an account with

either M1 Finance or Acorns, I am affiliated with both

and I do earn a small Commission if you decide

to use my link and that's at no additional cost to you,

so if you do feel like giving back to me

for putting this video together those links

are provided down in the description below

but it's totally optional if you guys do decide

that you want to give back to me,

if not no worries whatsoever.

But that being said, the biggest difference

between my finance and Acorns to address first is

that M1 Finance is 100% free.

They are making money there's a couple ways

they're making money on the backend

for example they make interest on the cash held

within the brokerage accounts and they also make money

by directing order flow.

Now that's pretty complicated and nothing you need

to worry about but Acorns actually does charge

a fee to people who use the platform.

Now they do waive the fee for college students

so if you are a college student you can use Acorns

for free but if you do want to use their investing platform

and you're not a college student it's gonna cost you

anywhere from one dollar to three dollar per month

based on the plan that you decide on.

So if you're somebody who is totally looking to save

as much money as possible and avoid fees well right off

the bat Acorns is gonna charge you fees M1 Finance is not.

The next key difference between these two accounts

is the minimum investment to get started.

So with M1 Finance your minimum to open an account is $100

and if you're looking to open up

a retirement account that is going to be a $500 minimum.

Acorns has really cornered this market here

by offering no account minimums so you could literally

get started with absolutely no money,

if you have like two dollars to get started

or whatever it may be, you can open up an account with them.

And another big difference between these apps

is your method for investing.

The reason why Acorns has become so popular

is because of that roundup style of investing.

So with M1 Finance you have to set money aside

and transfer it into your brokerage account,

you can automate this process and have it

take like fifty dollars per week for example

but there's still that human involvement when

it comes to that saving.

Acorns on the other hand, allows you to just round up

the spare change from your purchases

and then they will automatically invest that money

every time you reach a certain threshold dollar amount.

So that's why Acorns has become so popular

is because of that pain free approach to investing

where you're literally just rounding up your purchases

and that spare change is going towards

your investing account.

Now one more thing I wanna mention real quick

if you guys are looking to learn more about

the M1 Finance investing app it is my number one app

for beginners but it is pretty confusing,

I will admit that so to alleviate that a little bit

I put together a completely free 30 minute video tutorial

teaching you exactly how to get started

and how to use M1 Finance.

That's gonna be linked up in the description down below

a completely free 30 minute video guide

on how to use M1 Finance for beginners.

Now another key difference between M1 Finance and Acorns

is that M1 Finance allows a lot of flexibility

in terms of what you're actually investing in.

If you wanna build your own portfolio of stocks

and ETFs you are able to do that through

the custom Pie's functionality of M1 Finance.

Basically with M1 you're building these pies

which are essentially your portfolios

and you decide what percentage of your money is going

to go into each stock or each ETF.

So if you wanna build your own portfolio from scratch

and invest in individual stocks

you can do so through M1 Finance and also take advantage

of great features like fractional shares

and automated rebalancing.

We're go into a lot more detail about that

in that free M1 Finance training.

Now Acorns on the other hand one of the big differences here

is that you only have five portfolios you can invest

in with Acorns, you have five choices.

And while that may not be a bad thing for passive investors

if you're looking for more flexibility with your investments

well for having five options is not flexibility

and you cannot invest in individual stocks

on the Acorns investing platform.

M1 Finance offers over 30 expert built portfolios

that you can invest in for free and they allow you to do

your own selection of stocks and ETFs

if you wanna build your own portfolio from scratch.

So overall, those are the big differences here

and I would say if you're looking at M1 Finance

this is more so designed for the hands-on

or do-it-yourself type investor.

So if you want to select what ETFs to invest in

and what stocks to invest in you wanna

be more actively involved with that process

while M1 Finance is really good for that

but if you are looking for that more passive approach

they do offer over 30 different expert built portfolios

including target date retirement funds

or just basic stock in bond allocations

and those are completely free to invest in

and then you can automate the entire process

with their automation features.

So it's good for people who are looking to be stock pickers

for the long term, if you're looking to trade

in and out of stocks neither of these two platforms

are actually a good fit for that

and it's also good for passive portfolio based investing.

On the other hand, where I like Acorns is basically

for the lazy or forgetful investors

or free people who don't wanna be bothered

with setting up a portfolio

or going through these expert portfolios themselves

and learning the very basics of investing.

And it's also for people who are bad at saving money.

If you're notoriously bad at saving money

in your account and transferring funds

to your brokerage well, Acorns has automated that process

and made it pretty pain free by just using that roundup.

Now the one downside here that I have for Acorns

is that their fee structure can be high for small accounts

because no matter how much money you have invested with them

they have that monthly fee of one to three dollars

and okay a dollar a month may not sound like a lot of money

but if you only have like a hundred dollars invested

with them that means over the course of one year

you're paying twelve percent of

your total investment in fees.

So, you don't wanna ignore the fee even though

it seems small because if you have a a small amount invested

you're paying a lot in fees to Acorns.

But anyways guys those are the key differences,

hopefully this video helped you decide which one

is a better fit for you and of course I have links

to all those resources mentioned down

in the description below.

But thanks so much for watching this video

I hope you guys enjoyed it

and I will see you in the next one.

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