Luis Pazos 
M1 Finance is a financial app that offers various services like a Robo-advisor investment platform where you can buy ETF and stock portfolios, retirement accounts, and portfolio analysis tools. You can even open a checking or high-yield savings account with them.
While M1 Finance is a popular investment platform, you might wonder if it’s a safe place to invest your money. In this article, I’ll explain how M1 Finance protects its customers and whether it’s safe and legit.
M1 Finance was founded in 2015 and is based in Chicago, Illinois. The company now manages nearly $7 billion in assets and serves over 750,000 members.
Yes, M1 Finance is secure. It’s regulated by FINRA (Financial Industry Regulatory Authority) and is a member of SIPC (Securities Investor Protection Corporation). The company also uses “industry-leading security protection” and is FDIC-insured. However, investments you hold through M1 Finance are not guaranteed, and it’s important to do your research as no market investment is risk-free.
M1 Finance offers many products and services including individual, joint, crypto, and custodial investment accounts, traditional, Roth, SEP IRA retirement accounts, a Robo-advisor platform, trust accounts, margin and personal loans, a high-yield savings account, and a rewards credit card. They also offer services like portfolio rebalancing, tax-loss harvesting, and automatic deposits.
Is M1 Finance free? Yes, there are no fees for opening an account, transferring money, or managing your portfolio. There are no minimum balance requirements either, so you can start investing with any amount.
How does M1 Finance make money? They earn through premium services like advanced analytics tools and tax-loss harvesting, as well as interest on cash balances in customer accounts and select securities transactions.
SIPC is a nonprofit corporation that protects customers if a member brokerage firm fails, covering missing securities and cash up to certain limits. However, SIPC doesn’t cover losses due to market fluctuations.
FINRA is a self-regulatory organization that oversees brokers and firms in the securities industry. It ensures firms comply with federal securities laws, regulating licensing, discipline, marketing, trading, and sales practices. M1 Finance is also regulated by the SEC since it is registered in 53 states and U.S. territories.
The FDIC provides deposit insurance for banks and credit unions, protecting depositors up to $250,000 per account if a bank fails. Although M1 Finance isn’t a bank, it uses Lincoln Savings Bank for its banking products. Lincoln Savings Bank is FDIC-insured, so any eligible M1 Finance deposits will qualify for FDIC coverage.
M1 Finance uses several security measures to protect its users, including SSL (Secure Socket Layer) encryption and two-factor authentication (2FA).
Is M1 Finance legitimate? Yes, it is a legitimate financial services company, regulated by FINRA and a member of SIPC. Eligible deposits are also covered by FDIC through their relationship with Lincoln Savings Bank. Moreover, M1 Finance has a clean track record with no reportable disclosures.
While M1 Finance is a legitimate and reputable company, you should still research to make sure it’s the best investment platform for you. If you’re ready to get started, you can open an M1 Finance account with a small minimum investment of $100.
