Paid non-client of Betterment. Views may not be representative, see more reviews at the and .  about this relationship.

Betterment and M1 Finance digital investment advisors have more differences than similarities, which may simplify the decision of which investing platform is best for you. Both are among our top picks,ꦿ with Betterment winning the categories best for beginners, best for cash management, best for tax-loss harvesting, and best for crypto, an♐d M1 Finance winning best for sophisticated investors.

Betterment is one of the oldest robo-advisors and follows the index fund investment approach with rebalancing and tax-loss harvesting. Betterment Premium adds unlimited financial planner meetings. M1 Finance, in contrast, assumes a degree of investor knowledge and provides dozens of prebuilt investment portfolios along with individual stocks and ETFs. M1 Finance sees itself more as an automated investing solution than a true robo-advisor. We'll look at these two very different digital investment solutions and help you decide which one is a better fit for your portfolio needs.

Open an Account

• Account Minimum: $0, $10 minimum to start investing. $50 minimum for rebalancing.
• Fees: 0.25% (annual) for investing plan accounts with at least $20,000 or at least $250 per month in recurring account deposits. Otherwise, the fee is $4/month. 0.65% (annual) fee on accounts with at least $100,000 in assets for Betterment Premium account holders with unlimited access to certified financial planners. There are no management fees for Betterment Checking or Cash Reserve. For accounts with at least $2 million, there is a fee discount of 0.10%.

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Open an Account

Open an Account

• Account Minimum: $100 ($500 minimum for retirement accounts)
• Fee: A $3 monthly platform fee for clients with minimum balances of less than $10,000 in their total aggregated M1 accounts.

Read full review

Open an Account

Account Setup

Betterment

Betterment is a breeze to launch. Simply create a login and password, then add personal details like address and Social Security number. Next, complete the brief ꦗinitial questionnaire which considers goals, time frame, and risk level. Based on the questionnai♛re responses, you’ll receive a personalized asset allocation within your chosen portfolio strategy, comprised of U.S. and international stock and bond ETFs. You must create an account before you can view your portfolio.

Users select their desired portfolio from a variety of options, including fixed income, smart beta, and 澳洲幸运5官方开奖结果体彩网:ESG-focused portfolios. They can also ad🔜just the rꦍecommended asset allocation Betterment provides.

With $10 to start, small investors can begin inve♔sting immediately. The opportunity to view investment choices before funding is an advantage, although you need to c♔reate an account first.

Those with $100,000 or more can choose Betterment Premium, which includes unlimited access to 🎐澳洲幸运5官方开奖结果体彩网:certified financial planners (CFPs). Phone representatives, available on weekdays, can also🍷 assist with basic questions but💟 are not licensed to provide investment or tax advice.

M1 Finance

M1 Finance has a quicker setup than Betterment because there’s no initial questionnai🥀re. Create a username and password to begin the onboarding process.

M1 Finance assumes that you understand the type of portfolio you’re seeking. So the crafting of a portfolio is in your hands. You’ll have the opportunity to choose from thousands of stocks and ETFs along with many prebuilt and customized portfolio options. Portfolios are called “Pies” and can include up to 100 slices of individual stocks, ETFs, and customized portfolios.

Potential M1 Finance clients can explore the platform without funding an account. You need $100 to open a brokerage, 澳洲幸运5官方开奖结果体彩网:custodial, or trust account, and $500 for 澳洲幸运5官方开奖结果体彩网:i𝔉ndividual retirement accounts (IRAs). M1 Finance doesn’t offer financial advisors.

M1 Finance combines self-directed brokerage features with pre-built portfolios and automated portfolio management capabilities. M1 Finance does not provide advisory services and therefore is not considered a traditional robo-advisor.

Account Setup Verdict: Betterment

Overall, the account setup is painless with either Betterment or M1 Finance. We are giving Betterment the edge on account setup solely because you can start investing with very little capital.

Account Types

Betterment

• Individual taxable
• Joint taxable 
• Traditional IRA 
• Roth IRA
• 401(k) rollover IRA
• 澳洲幸运5官方开奖结果体彩网:Simplified employee pension (SEP) IRA 
• Trust
• 529 plan (through Betterment at Work)
• High-yield cash account
• Checking account

M1 Finance

• Individual taxable
• Joint taxable 
• Traditional IRA 
• Roth IRA
• 401(k) rollover IRA
• SEP IRA 
• Custodial (available to M1 Plus users)
• Trust
• High-interest savings (higher yields for M1 Plus users)
  

Account Types Verdict: Tie

Both Betterment and M1 Finance offer the most commonly used account types. That said, if you’re a parent seeking a custodial account, then M1 Finance is the only option. M1 Finance also offe꧃rs an IRA concierge for onboarding help. Retirement investoꦯrs with less than $500 to invest may prefer Betterment, however, as it requires just $10 to start investing.

Account Services

Both Betterment and M1 Finance offer auto 🥂deposits and free withdrawals, as well as cash management services. Both platforms also offer a premium level with added services for an additional fee, although the services are 🌞distinct.

Betterment

Betterment Premium customers with $100,000 or more in assets have unlimited access to CFPs for a fee of 0.65% of assets under management (AUM). This management fee is lower than the average 1.0% fee charged by 💧traditional financial advisors.

Betterment offers two cash accounts. This stands out among digital investment managers, which typically offer only one cash management option. The Cash Reserve cash account and checking accounts are available separately from the Betterment investment accounts. The checking account, offered through nbkc bank, includes an ATM and Visa cashback debit card, while the high-yield Cash Reserve account provides higher-than-average interest rates. Users also can set up automatic funds transfers for specific goals from t🌃heir✤ checking account, as well as direct deposits.

M1 Finance

M1 Borrow is the loan option available at M1 Finance. Betterment does not provide margin or other lending features. The M1 Plus premium service costs $36 per year and includes additional benefits. For example, Plus users can access an additional daily trading window, higher savings account interest, and lower-margin interest rates. The Owners Reward card is available to all users and provides up to 10% cash back for spending with companies whose stock they own.

Account Services Verdict: Betterment

Which platform you prefer depends upon the account services you’re seeking. If you want access to margin and a credit card, then M1 Finance can do the jo༺b. However, If you’re seeking a complete cash management option and checking integrated with your investment account, then Betterment is the better option.

Cash Reserve is only available to clients of Betterment LLC, which is not a bank, and cash transfers to program banks are conducted through clients’ brokerage accounts at Betterment Securities. For Cash Reserve (“CR”), Betterment LLC only receives compensation from our . Betterment LLC and Betterment Securities do not charge fees on your CR balance.

Checking accounts and the Betterment Visa Debit Card provided and issued by nbkc bank, Member FDIC. Checking is made available through Betterment Financial LLC. Neither Betterment Financial LLC, nor any of its affiliates, is a bank. Betterment Financial LLC reimburses ATM fees and the Visa® 1% foreign transaction fee worldwide, everywhere Visa is accepted.

Goal Planning

Betterment

Betterment is a top firm in the digital investment management space, offering flexible goal-planning features. Clients can set multiple goals and choose separate asset allocations for each goal type and timeframe. For example, your retirement will usually have a longer time ho🧸rizon and more aggressive asset allocation than your home down payment or upcoming vacation goals. Betterment also auto adjusts allocations to portfolios that become more conservative as you nea🍸r the time when you will need the money.

Moreover, the Goal Forecaster tool helps you calculate approximately when you’ll achieve the goal and guides you to adjust the portfolio to increase your likeliℱhood of success.

M1 Finance

M1 Finance assumes that you can handle goal planning on your own. Its nod to goal ༺planning is the wide variety of articles on the M1 Finance blog, which spans a range of financial education investing topics. Beyond 🐟that, M1 Finance lacks any specific goal-planning features.

Goal Planning Verdict: Betterment

When it comes to goal planning, there’s no comparison between Betterment and M1 Finance. Goal planning is Betterment𒁏’s forté, while M1 Fꦏinance leaves this aspect of investing to the user.

Portfolio Construction

Betterment

Betterment's portfolios include Core, ESG/Socially Responsible, Smart Beta, Innovative Technology, and Income Portfolios. The Core portfolio provides typical market-cap weight diversified U.S. and international stock and bond ETFs. It includes value and small-cap equity funds which outperform the broad stock market index during long time periods, according to 澳洲幸运5官方开奖结果体彩网:factor research. Betterment also includes an international bond ETF in its fixed-income ho🍬ldings.

Betterment investors looking for alternate investment style options might consider the Goldman Sachs Smart Beta, BlackR⛎ock Target Income, Flexible, or four ESG portfolios. In addition, similar to ful🅺l-service investment platforms, Betterment Cash accounts offer the opportunity to save for emergencies and short-term goals.

Some customization is allowed through Flexible portfolios. These enable you to tweak asset class weightings and access other asset classes that aren’t in the Core portfolio, including commodities and REITs.

Betterment offers one crypto ETF portfolio. On top of thiꦆs, Betterment has also introduced a Value Tilt portfolio in 2ꦐ024 that looks for undervalued companies in the U.S. to try and outperform over the long term, bringing yet another option for investors.

M1 Finance

Although we consider M1 Finance a member of the digital investment advisory space, it also has features common to self-directed brokerage acco🐓unts. Investors can choose from different prebuilt Expert Pies with multiple investment strategies including, hedge fund-like styles, socially responsible investing, income portfolios, and more.

M1 Finance users also can choose from over 6,000 stocks and ETFs to invest in, for a Custom Pie or to add to an Expert Pie. The screening tool helps investors find sec𝓀urities that meet specific criteria. M1 Finance will rebalance your Pie to♏ keep the allocation percentages consistent as funds are added or withdrawn.

Available Assets 

Portfolio Customization

Betterment

Betterment users can adjust their asset allocations if they don’t agree with the allocations they're offered. The Flexible portfolio option opens up more asset classes, although the investing is still done through funds. That said, Betterment doesn’t offer the ability to add additional ETFs or other assets to its existing options to the same extent as M1 Finance does.

M1 Finance

M1 Finance is one of the most customizable digital wealth management platforms that we reviewed. In addition to accessing the customized prebuilඣt portfolios, users can modify their Pies by adding individual stocks and ETFs. You choose the percentages for each investment in accordance with your persona💟l risk tolerance and goals. This does, of course, require investment knowledge to ensure that your choices aren’t overly conservative or aggressive.

Portfolio Customization Verdict: M1 Finance

Overall, M1 Finance provides much more in terms of portfol🦹io customization.

Portfolio Management

Betterment

At Betterment, rebalancing occurs automa﷽tically when assets deviate above or below the desired asset allocation percentage and your account meets the minimum balance threshold. You can also link outside financial accounts to view and analyze your investments holistically. Betterment will offer suggestions based on all linked accounꦑts, but the portfolio asset allocation is crafted without considering the outside assets.

M1 Finance

After setting up your asset allocation at M1 Finance, the platform will rebalance your Pie when funds are deposited or withdrawn. You can also initiate a rebalance manually. In addition, M1 Basic supports one trading window in the morning. M1 Plus members with over $25,000 can place trades during a morning and an afternoon trading window.

Portfolio Management Verdict: Betterment

While both M1 Finance and Betterment offer automate♐d rebalancing, Betterment’s is initiated on rules-based movements while M1 Finance only rebalances when funds are added or removed from the portfolio (unless you conduct a manual rebalancing). Betterment also adjusts the portfolio over time as a goal approaches to ensure that you are in a more conservative position when you🐠 need the money.

Tax-Advantaged Investing

Both Betterment and M1 Finance offer tax-🌌advantaged retirement accounts, but the suppo💧rt for taxable accounts is different.

Betterment

Betterment offers 澳洲幸运5官方开奖结果体彩网:tax-loss harvesting to customers who meet certain criteria. This strategy offsets capital gains with losses to mi𝔍nimize tax payments. Betterment’s tax-loss harvesting methodology seeks to m💃aximize tax savings by constantly monitoring for tax-saving opportunities.

Customers who choose to enable Betterment's Tax Loss Harvesting+™ feature will have a powerful, fully automated tool at their disposal. One way this feature works is by utilizing dividend reinvestments and regular rebalancing activities. The other, in a process that is also part of Betterment's tax minimization strategy, is to use any withdrawals made by its customers as opportunities to sell off any losses. The subsequent rebalancing will position the portfolio through substitutions to further lessen the tax burden.

M1 Finance

M1 Finance doesn’t have a tax-loss harvesting feature but does strive to minimize taxes when withdrawals are made. The platform does this by prioritizing sales in order of the lowest tax burden to the highest and selling in that order. This is similar to Betterment’s user-triggered tax-loss harvesting, but not backed up by seeking ongoing tax-loss harvesting opportunities.

Tax-Advantaged Investing Verdict: Betterment

Betterment has a clear edge in tax-a𒁏dvantaged investing thanks to its tax-loss harvesting methodoloꦡgy.

Betterment is not a licensed tax advisor.  (TLH+) is not suitable for all investors and is subject to certain conditions. Read more at  and consider your personal circumstances before deciding whether to utilize Betterment’s TLH+ feature. Investing involves risk. Performance not guaranteed.

Key Portfolio Management Features

Security

When it comes to security, Betterment and M1 Finance are evenly matched. Both enable top-level financial institution-grade security protocols. They provide two-factor authentication, 澳洲幸运5官方开奖结果体彩网:Securities Investor P✃rotection Corpo🌃ration (SIPC) insurance for securities, and 澳洲幸运5官方开奖结果体彩网:Federal Depos𝓀it Insurance Corporation (FDIC) insurance for cash accounts through program banks.

Security Verdict: Tie

Your money is safe at either of these investment platforms. It is impo🐽rtant to note that insurance and security features protect against company failure and infiltration attempts. They do not protect against market volatility which can result in lower account values.

User Experience

Desktop

Betterment and M🧸1 Finance offer user-friendly websites and easy access to most platform screens. You can typically find what you’re seeking within a click or two from the home page. Betterment clients also can moni🦹tor and adjust planning goals from the dashboard.

Mobile App 

Betterment and M1 Finance mobile apps provide functionality nearly identical to their respective websites. In general, users report fa𒈔vorable experiences on each, with the occasional technical problem such as difficulty linking accounts. Each of these well-regarded platforms enables users to do nearly anything on mobile that they can accomplish on the desktop version.

Customer Service

Access to customer🎀 service is nearly identical at Betterment and M1 Finance. The exception is the later weekday phone hours at Betterment. This additional phone consultation time from 4 p.m. to 6 p.m. makes it easier for customers to cont🐓act the firm after work.

Customer Service Verdict: Betterment

We give Betterment the edge in cu🐼stomer service based solely on the longer window you can reach them during.

Fees

Betterment

Betterment charges a flat 0.25% AUM for all Investing plan clients or $4 per month for accounts under $20,000 that do not set up a monthly deposit of at least $250. Premium users with more than $100,000 can opt to pay 0.65% for more features or stick to basic. The Premium fee covers unlimited financial advisor access. For accounts with at least $2 million, there is a fee discount of 0.10%.

M1 Finance

M1 Finance Basic is free. You get all of the features with no management fee or trading fees. M1 Plus costs $36 per year and offers upgraded trading, lower borrowing rates, and higher savings account interest rates.

Fees Verdict: M1 Finance

ᩚᩚᩚᩚᩚᩚ⁤⁤⁤⁤ᩚ⁤⁤⁤⁤ᩚ⁤⁤⁤⁤ᩚ𒀱ᩚᩚᩚThose looking for a fee-free investment platform might start with M1 Basic. Even the M1 Plus account is reasonably priced. That being said, investors may feel that the 0.25% management fee at Betterment is affordable and worth paying if they seek tax-loss harvesting and more robust goal-planning support.

The Bottom Line

M1 Finance and Betterment are well-regarded digital investment managers suitable for different types of investors. Investors seeking quality automated investment management and access to financial planners for reasonable fees will find that Betterment has a lot to offer. It is designed for beginning or hands-off investors who want well-constructed and well-managed portfolios. It has options for ESG, income, and factor-based smart beta investing and offers tax-loss harvesting. Betterment's two cash accounts round out the platform and make it competitive with full-fledged financial institutions. 澳洲幸运5官方开奖结果体彩网:Betterment can benౠefit any investor who wants an investment portfolio that runs itself.

M1 Finance is for hands-on investors who know what they want. Investors select a prebuilt portfolio that can achieve their investment goals. In addition, they have access to more than 6,000 ETFs and stocks to customize their portfolios. M1 Finance's screener, margin accounts, savings account, and lending options make it competitive with some full-service investment brokers. Overall, an 澳洲幸运5官方开奖结果体彩网:M1 Finance account may be ideal for cost-conscious investors seeking a DIY portfolio without the headache of ongoing portfolio maintena♑nce.

How We Picked the Best Robo-Advisors

Providing readers with unbiased, comprehensive reviews of digital wealth management companies, more commonly known as robo-advisors, is a top priority of Investopedia. To collect data for our 2024 best robo-advisor awards and rankings, we sent a digital survey with 64 question♛s directly to each of the 21 companies we included in our rubric. Our team of researchers verified the survey responses and collected any missing data points 🦄through online research and conversations with each company directly. The data collection process took place from Jan. 8 to Feb. 9, 2024.

We then developed a quantitative model that scored each company to rate its performance across nine major categories and 59 criteria to find the best robo-advisors. The score for each company’s overall star rating is a weighted average of the criteria:

• Goal Planning - 21.00%
• Portfolio Contents - 17.00%
• Portfolio Management - 17.00%
• Fees - 15.00%
• Account Services - 10.00%
• Account Setup - 5.00%
• Customer Service - 5.00%
  
• Security & Education - 5.00%
• User Experience - 5.00%

Many 🔴of the companies we review f💧or our projects grant our team of expert writers and editors access to live accounts so they can perform hands-on testing. Robo-advisor companies allowed us to do this, as well.

Through this all-encompassing data collection and review process, Investopedia has provided you with an unbiased and thorough review of the top robo-advisors. Read more about 澳洲幸运5官方开奖结果体彩网:how w🔯e research and review robo-advisors.

The above material and content should not be considered to be a recommendation. Investing in digital assets is highly speculative and volatile, and only suitable for investors who are able to bear the risk of potential loss and experience sharp drawdowns. Digital assets are not legal tender and are not backed by the U.S. government. Digital assets are not subject to FDIC insurance or SIPC protections.