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If you want to grow your wealth with automated investing, Wealthfront and M1 Finance are two popular choices. Both offer low-cost, hands-off options and self-directed investing, but they suit different approaches. This guide compares their features, fees, and ideal users to help you decide.
Wealthfront started as a classic robo-advisor for investors who want a fully managed experience. After a short questionnaire, it builds a diversified portfolio aligned with your timeline, risk tolerance, and goals. Wealthfront handles rebalancing, dividend reinvestment, and tax-loss harvesting to help boost after-tax returns. It also offers individual stocks, ETFs, and themed portfolios.
M1 Finance focuses on flexibility and customization. It gives access to thousands of stocks and ETFs, plus screeners to help you build a portfolio. M1 also offers expert model portfolios for retirement, income, stock-and-bond mixes, global exposure, socially responsible investing, and varying risk levels. The platform can rebalance your portfolio to your chosen allocation upon request. M1’s investing is free with a $10,000 balance or loan; otherwise, it charges $3 per month.
Which to choose depends on how hands-on you want to be. Pick Wealthfront if you want a fully managed, tax-efficient portfolio with minimal effort. Choose M1 if you prefer to design your own portfolio, use a model portfolio, and retain control while using automated rebalancing and other tools. Both platforms provide cash management and socially responsible investing options.
Both Wealthfront and M1 take security seriously. Wealthfront uses bank-level protections, and cash deposits are covered through partner banks by the FDIC; brokerage assets are protected by the SIPC, though market risk remains. M1 is a registered broker-dealer with the SEC, uses FDIC-protected partner banks for cash, and its brokerage accounts are SIPC-covered; market risk still applies.
