I always recommend investing in your tax-advantaged accounts before doing any after-tax investing. The reason is if you can reduce your taxable income now, great. Chances are when the time comes to withdraw that money in retirement, you’ll be in a lower tax bracket.
Once you are maxing out your tax-advantaged accounts and are looking to invest more, you might be interested in opening an individual investing M1 account. This post is to give you my review of M1 Finance which is where I invest my post-tax monies. However, you can do tax-advantaged investing with M1 as well!
Affiliate Disclosure
I am in the M1 Finance affiliate program which means if you click on any M1 Finance link on my blog, open and fund an account, I may earn a commission. This commission is at no extra cost to you. It’s just simply a way to support me in my blogging endeavors. I only partner with affiliates I’ve used and recommend to my readers.
Before we get to M1 Finance, I wanted to give you some quick examples of tax-advantaged accounts:
- 401k – pre-tax investing
- 457b – pre-tax investing for government workers
- Simple IRA – pre-tax investing
- IRA – tax-deductible investing
- Roth IRA – post-tax money going in but tax-free money coming out
- SEP IRA – tax-deductible investing
- HSA – the ultimate investing vehicle if you are on an HSA qualified plan. You can put money in pre-tax, invest it, and when you withdrawal it to reimburse yourself for qualified medical expenses, you don’t pay tax. I’ve written a fun post about this here.
Post-tax investing simply means that you are taking some of your income (after it’s been taxed) and investing it.
What is M1 Finance?
M1 Finance is essentially a Robo-advisor which means it is an online financial services company. There is a desktop version as well as a mobile app. M1 Finance is registered with the Securities and Exchange Commission (SEC) as a broker-dealer. Additionally, M1 is a member of the Financial Industry Regulatory Authority (FINRA) and the Securities Investor Protection Corporation (SIPC).
Now, that we’ve gotten that out of the way let’s talk about some of the perks I’ve discovered with investing with M1 Finance.
Free
Who likes free??

Yeah, I do too! With M1 finance you can deposit money anytime from your desktop or mobile app. There are no trading fees or commissions. Yep, you read that right – there are no trading fees or commissions! There is the option to open an M1 Plus account which includes some extra features for a monthly fee; however, the default account is totally free! Additionally, there is no minimum to open an M1 account, but you do need to deposit at least $100 to begin investing.
Fractional Shares
The option to buy fraction shares hooked me. There are some stocks which are costly for just one share, like Amazon. On the day I wrote this article, Amazon stock costs $1,794.16 a share.
Typically, if you don’t have $1,794.16 you are not able to buy stock in Amazon.
However, with M1 Finance, you can buy fractional shares which makes me really happy. 🙂 With my tax-advantaged accounts, I buy broad-based index funds. With M1 Finance I buy blue-chip stocks.
Blue-chip stocks are just stocks in a corporation with a national reputation for quality and reliability. Typically they are financially sound, profitable and historically reliable companies.
Customization
When you open an M1 account you are able to invest in custom pies. Think back to elementary school math when you were learning about fractions. Basically you pick which stocks, bonds or ETFs (Exchange Traded Funds) you want and assign percentages to each until you have your whole pie (100%).
Okay, a quick sidebar to explain a few terms in the investing world:
Stocks – when you buy stocks in a company it’s like you own a little slice of that company. You become a shareholder! Stocks have a potentially greater reward but that also means greater risk.
Bonds – when you buy a bond, you are lending the company money and getting paid back with interest. Bonds are more stable but that means less reward.
ETFs or Exchange Traded Funds – when you buy an ETF, it is essentially like buying stocks (or bonds) in a bunch of companies. This is typically my flavor because if one company tanks, I’m not out all my money! The reason is that with a large basket, some of the other companies are bound to be killing it, and others are probably mediocre so it balances out in the end. There are different kinds of ETFs, which is a post for another day, but here is my post on investing 101.
Mutual Funds – when you buy a mutual fund, it is very similar to ETFs in that you get a bunch of companies all in one. Actually most of my pre-tax investing is in mutual funds. The biggest difference between mutual funds and ETFs, which again is a post for a different day, is that you can buy an ETF for the price of one share where a mutual fund typically has a minimum buy-in like $1,000, $3,000 or $10,000.
Lastly, all of the above, except mutual funds can be purchased on M1 Finance.
Back to the pie talk, with M1 you can have multiple pies for your investment needs (I only have one ‘cus I like to keep things simple). Most importantly, they have some pre-built pies, called expert pies for diversification. If you are new to investing and are not too sure how to select your pie, check this out.⇓
Though, my goal is that if you hang with me, you’ll feel comfortable enough to pick your own funds.
Dividend Reinvestment
If any of the stocks or ETFs give out dividends, M1 will reinvest the dividends. The dividends sit in your cash account until they reach $10 at which time M1 will reinvest them.
Automation
This is the key, IMHO, to successful savings. Initially, I was just investing small amounts manually and playing around on M1 until I was comfortable with all of the features. Now, I’ve set up automatic deposits once a month to be invested in my pie. Automation is easy and ensures I hit my savings goals every time!



When selecting recurring, you can choose weekly, bi-weekly, monthly on a date, or monthly on a week.
M1 Spend
M1 Finance also now has a digital banking account you can (but don’t have to) open. It comes with a debit card and allows you to have seamless integration to your investment portfolio. I do my automatic investing by linking my checking account to my M1 account.
M1 Borrow
M1 Finance allows for borrowing. I’m not interested in this feature so I cannot speak too much about it but it is there.
Multiple Accounts
Lastly, M1 does offer different types of accounts to fit your need. I personally have an individual account but as you can see, your options are rather robust!
Closing Thoughts
M1 Finance is a great option for post-tax investing or IRA investing. I just happen to do the former with M1. I find it very user-friendly and easy to use. The fractional shares option is stellar and it’s free!! What more can I say?
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