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M1 Finance vs. Betterment
Consider how much portfolio customization you want when you compare these two robo-advisors.
Both M1 Finance and Betterment use an algorithm to manage and allocate funds. But one gives you more control over your portfolio.
Which one is better?
- Choose M1 Finance if you want to create your own portfolio.
- Choose Betterment if you want an expert-curated portfolio and prefer a hands-off approach.
M1 Finance and Betterment offer similar offerings — account rebalancing, commission-free trades and a well-stocked financial library. The better platform depends on the type of investor you are.
M1 Finance lets you build your own portfolio from scratch. While Betterment allows for some customization, you still need to start from a recommended prebuilt portfolio before making adjustments. For self-directed investors that know what they want, M1 Finance may be a good choice. You’ll need a $100 minimum deposit to use the free platform.
But if you want some professional guidance, go with Betterment. You’ll start with an expert-curated portfolio that’s tailored to your situation. But, it’ll cost you an annual advisory fee, which is lower than the industry’s going rate. And you’ll get extra perks like tax-loss harvesting and financial planning tools that let you see how your portfolio stacks up against your financial goals.
How do M1 Finance and Betterment compare?
|Overview||M1 Finance is a robo-advisor that puts you in the driver’s seat with fully-customizable portfolios. It strikes a balance between automated investing and personalization, making it a good fit for hands-on, long-term investors.||Betterment is an online financial advisor that makes investing easy by creating a portfolio just for you, based on your preferences and financial goals. It’s a solid choice for those new to investing.|
|Minimum deposit to open||$100||$0|
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M1 Finance and Betterment provide expert-created portfolios with different levels of risk. M1 Finance is better suited for investors that want more control over their investments. But you might have a hard time getting customer support.
Betterment is geared towards passive, set-it-and-forget-it investors that want the robo-advisor to handle their portfolio. It’ll handle buying and selling securities for a small advisory fee and even help reduce your tax exposure. And if you need help, customer service is available seven days a week.
If neither of these robo-advisors fit the bill, take a look at a few other platform options.
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