The automated investment company Wealthfront was founded in 2008, while M1 Finance opened for business in 2015. While both brokers provide a place for traders to get their start, they are not identical.
In this overview of Wealthfront vs. M1 Finance, we discuss everything you'll want to know before working with a broker, from the fees each charge to the types of investments offered. By the time you finish reading this comparison, you should have a better idea of which broker is right for you.
Wealthfront vs. M1 Finance: At a glance
| Offer | M1 Finance | Wealthfront |
|---|---|---|
| Rating | Rating image, 4.5 out of 5 stars. 4.5/5Our ratings are based on a 5 star scale.5 stars equals Best.4 stars equals Excellent.3 stars equals Good.2 stars equals Fair.1 star equals Poor.We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. | Rating image, 4.5 out of 5 stars. 4.5/5Our ratings are based on a 5 star scale.5 stars equals Best.4 stars equals Excellent.3 stars equals Good.2 stars equals Fair.1 star equals Poor.We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. |
| Commissions | $0 commissions and no management fee. M1 Plus membership costs $3 per month. | $0 per trade, management fee 0.25% |
| Account Minimum | $100 | $500 |
| Next Steps | Open Account for M1 Finance Read Full Review | Read Review |
Wealthfront vs. M1 Finance: Commissions & fees
Both brokers keep costs low, which leaves traders with more money to invest. Neither brokerage charges a fee for stock or ETF trades or an account maintenance fee.
The two brokers differ in their account transfer fees. While Wealthfront does not charge one, M1 Finance investors pay $100 for a transfer.
| Wealthfront | M1 Finance | |
|---|---|---|
| Stock & ETF commissions | $0 | $0 |
| Options commissions | N/A | N/A |
| Crypto commissions | N/A | $0 |
| Mutual fund commissions | N/A | N/A |
| Account transfer fee | $0 | $100 |
| Account maintenance fee | $0 for Stock Investing Account 0.25% yearly for Automated Investing Account | $0 |
Data source: Wealthfront and M1.
Wealthfront vs. M1 Finance: Investments available
Both brokers offer stocks, ETFs, and fractional shares. However, neither offers options, mutual funds, CDs, bonds, futures, or currencies. Only M1 Finance offers crypto.
Wealthfront and M1 Finance may be described as bare bones compared to other brokers. Still, they each provide a reputable option for a novice trader looking for low-fee automated investing.
| Wealthfront | M1 Finance | |
|---|---|---|
| Stocks and ETFs | Yes | Yes |
| Fractional shares | Yes | Yes |
| Options | No | No |
| Mutual funds | No | No |
| CDs | No | No |
| Bonds | No | No |
| Futures | No | No |
| Crypto | No | Yes |
| Currencies | No | No |
Data source: Wealthfront and M1.
Wealthfront vs. M1 Finance: Account types available
M1 Finance offers two account types unavailable to Wealthfront customers: margin accounts and checking accounts. While Wealthfront does offer a cash management account, M1 Finance is the best option for anyone hoping to open a dedicated savings account under the same roof as their brokerage account.
However, both of these brokers are famous for their robo-advisory platforms, which allow investors to trade without being involved in the hands-on management of their accounts.
| Wealthfront | M1 Finance | |
|---|---|---|
| Taxable brokerage | Yes | Yes |
| Joint tenant | Yes | Yes |
| Margin | No | Yes |
| Robo-advisor | Yes | Yes |
| Traditional IRA | Yes | Yes |
| Roth IRA | Yes | Yes |
| Other IRAs/Retirement | SEP IRA and 401(k) Rollovers | Yes |
| Custodial | 529 Plan | Yes |
| Checking | No, but offers a cash management account | No |
| Savings | No, but offers a cash management account | Yes |
| Credit card | No | Yes |
Data source: Wealthfront and M1.
Wealthfront vs. M1 Finance: Mobile app and trading platforms
The fact that so many people trade online and on the go makes the quality of a broker's mobile app and trading platforms even more important. Here's a breakdown of what Wealthfront and M1 Finance bring to the table.
Wealthfront
Platform highlights
- Clear, easy-to-understand layout, which is important given that Wealthfront does not provide access to human advisors.
- A full-featured platform that provides the features many new investors look for when searching for the best online brokers for beginners. However, it may be too basic for experienced investors.
- Whether through the online platform or app, Wealthfront walks investors through ways to minimize their investment-related taxes.
- Wealthfront offers limited ability to diversify, due to relatively few investment options.
Mobile app
iOS users give Wealthfront's robust, easy-to-follow app an excellent score of 4.8 out of 5 stars. Android users appear to be just as impressed, also giving the app a score of 4.8 out of 5 stars.
M1 Finance
Platform highlights
- Like Wealthfront, may be too basic for experienced investors. However, it could be quite effective for a new investor who wants to get their feet wet.
- Thanks to Dynamic Rebalancing, the account holder does not have to worry about checking and rechecking their account to ensure it's balanced.
- Also like Wealthfront, M1 Finance offers relatively few investment options, making it difficult to diversify.
Mobile app
iOS users give M1 Finance's clean and concise app a score of 4.7 out of 5 stars, and Android users also seem happy with the M1 Finance app, giving it a score of 4.5 out of 5 stars.
Final take
It's difficult to say that one of these brokers is better than the other. Both are good for novice investors, but neither provides the number of investment options needed to diversify a portfolio. They're both an excellent choice for hands-off investors who don't want to negatively impact their finances by paying high fees.
Alternatives to Consider
We recommend comparing brokerage options to ensure the account you're selecting is the best fit for you. To make your search easier, here's a short list of our best trading platforms of 2024.
| Account | Fees | Account Minimum | |
|---|---|---|---|
Rating image, 4.5 out of 5 stars. 4.5/5Our ratings are based on a 5 star scale.5 stars equals Best.4 stars equals Excellent.3 stars equals Good.2 stars equals Fair.1 star equals Poor.We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. | $0 for stocks, ETFs, and options | $0 | Open Account for Robinhood |
Rating image, 4.0 out of 5 stars. 4.0/5Our ratings are based on a 5 star scale.5 stars equals Best.4 stars equals Excellent.3 stars equals Good.2 stars equals Fair.1 star equals Poor.We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. | $0 per trade | $0 | Open Account for J.P. Morgan Self-Directed Investing |
Rating image, 4.5 out of 5 stars. 4.5/5Our ratings are based on a 5 star scale.5 stars equals Best.4 stars equals Excellent.3 stars equals Good.2 stars equals Fair.1 star equals Poor.We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs. | Commission-free; other fees apply | $0 | Open Account for E*TRADE |
FAQs
While anyone can use Wealthfront or M1 Finance to trade, the best user would be someone who is very new to trading or wants a hands-off experience.
The more a brokerage charges you, the less you have in your account to invest. It may not seem as though you're paying much at first, but you're not only covering fees, you're also losing out on any gains you could have earned by investing that money instead.
Our Brokerages Experts
By:Dana George
Writer
Dana George has a BA in Management and Organization Development from Spring Arbor University. For more than 25 years, she has written and reported on business and finance, and she's still passionate about her work. Dana and her husband recently moved to Champaign, Illinois, home of the Fighting Illini. And though she finds the color orange unflattering on most people, she thinks they'll enjoy Champaign tremendously.
Fact CheckedAshley Maready
Writer and Editor
Ashley Maready is a former history museum professional who made the leap to digital content writing and editing in 2021. She has a BA in History and Philosophy from Hood College and an MA in Applied History from Shippensburg University. Ashley loves creating content for the public and learning new things so she can teach others, whether it's information about salt mining, canal mules, or personal finance.
