M1 Finance vs Vanguard 2025 – What is the difference?

So, which option should you choose as your investment platform of choice when it comes to M1 Finance vs Vanguard?

M1 Finance Overview

M1 Finance started back in 2015 under the guidance of CEO Brian Barnes. With its roots in Chicago, Illinois, the firm now holds over $5 billion in investor assets. Their approach to automated portfolios has made them incredibly popular among beginner investors who have little to no experience in the financial markets.

As mentioned in our M1 Finance review, we believe this platform is a game changer. Based on your future investment goals, you can select one of their automated portfolios. It doesn’t matter whether you’re looking to save money for a house or to plan for your retirement, M1 can do it all.

This completely automated service also enables investors to create custom portfolios using the pie investing feature.

No matter your investing strategy, whether you want total control over your investments or whether you want to invest and let it ride, investing with M1 Finance allows you to do that and more.

M1 Finance Details

The M1 platform, whether on desktop or on the M1 Finance app, requires no minimum investment and no fees. Although there are some small fees for certain actions, most investors can take advantage of commission-free trading. There are zero account minimums at any point, so if you only have a small amount to invest you won’t have any problems.

M1 Finance supports a large number of account types, such as IRAs, individual brokerage accounts, and even custodial accounts. Many investing platforms don’t offer the same variety of supported investment accounts.

If you’re more confident with investing, you can create ‘pies’. The pie investing system enables you to make your own custom portfolios. Alternatively, you can also let the experts handle your portfolio with the robo-advisor’s M1 Model Portfolios.

These pre-made portfolios contain various individual stocks and ETFs designed to align with specific goals and risk levels.

M1 Finance Fees

M1 Finance has always taken pride in offering commission-free trades. This is why M1 investing is such a game changer as traditional brokerage firms usually charge commissions, management fees, margin fees, and other trading fees, as well as requiring adherence to various account minimums.

Instead, the platform turns a profit through its separate M1 Spend and M1 Borrow features. These FDIC-insured checking accounts, portfolio lines of credit, and personal loans come with fees, but unless you want to go beyond the standard investing account you’ll never pay any fees.

However, if you’re looking to enhance your investing experience, you do have the option of upgrading to M1. This is the upgraded M1 Finance investing account and costs $125 per year.

M1 provides unlimited access to all of M1 Finance’s services and features, such as a higher ACH limit per day. On balance, the majority of investors will not need the upgraded version of M1.

Who M1 Finance Is Best For

M1 Finance is best for investors who are looking for a low-cost, automated investing platform. The commission-free trading and no account minimums make it an attractive option for those just starting out in the world of investing. Additionally, M1 Finance’s pie investing feature makes it easy to create custom portfolios with minimal effort. For those who want more control over their investments, the robo-advisor also offers Model Portfolios that are designed to align with specific goals and portfolio risk tolerance. Finally, M1 provides additional features such as a higher ACH limit per day for those who want to enhance their investing experience.

Vanguard Overview

Vanguard was founded by Jack Bogle back in 1975 in Malvern, Pennsylvania. It quickly grew to become one of the most popular investment advisors in the nation. Bogle, for example, was credited with creating the first-ever index fund. Plus, they were arguably the fathers of low-cost investing.

Before M1 Finance and other robo-advisors began offering 0% fees, Vanguard was offering 0.04% on its ETF trading. It’s also worth mentioning that Vanguard is owned by the funds it manages, therefore they are run by its long-term investors on an indirect basis.

Currently, Vanguard is the biggest provider of mutual funds and the second-biggest provider of ETFs in the country.

Vanguard Details

Vanguard Fees

Vanguard does charge fees, whereas M1 Finance charges none. Vanguard’s 0.30% management fee is a real killer with an account minimum of $50,000. However, they do favor investors with larger investment portfolios, and so if you happen to have a diversified portfolio value of more than $25 million, your management fee would be just 0.05%.

Its expense ratios are still at a record low of 0.04%, which is extremely similar to M1 Finance. In short, if you’re concerned about fees, Vanguard may not be the best brokerage firm for you.

Who Vanguard Is Best For

Vanguard is best for investors who are looking for a more comprehensive investing experience. With its human advisors and robo-advisors, a large number of responsible investing options, and supported account types including retirement accounts, Vanguard provides a wealth of resources to help investors make informed decisions. Additionally, the low expense ratios and access to Vanguard index funds make it an attractive option for those with larger portfolios. However, the high account minimums and management fees may be prohibitive for some investors.

M1 Finance vs Vanguard: The Bottom Line

Vanguard is the king and M1 Finance is the young pretender. The reality is that both platforms are for different types of investor with different investment goals. Unless you already have a large amount to invest, Vanguard is not an option.

This has long been part of the problem with investing. M1 Finance enables you to get started even if you don’t have a lot of money. You can start with as little as a few dollars and begin crafting your portfolio using M1 Finance’s pie system, or you can take advantage of one of their pre-made investment portfolios.

Vanguard, on the other hand, works directly with you to create the portfolio that’s right for you. There’s an added personal touch that you just don’t find with most conventional robo-advisors, and that’s what high net-worth, seasoned investors expect to pay for.

Overall, M1 Finance offers a simpler product that works better for most ordinary investors. If you already have a significant amount to invest, you may want to consider using Vanguard’s PAS service.

Whether you want to create an account with M1 Finance or Vanguard, do it with Modest Money. Enter the market and begin forging the future you deserve.

Create your M1 Investing account and invest for free with M1 Finance.

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