Articles by Mr. Money

Don’t Fall Prey To A Victim Mentality. Be Responsible For Your Actions And Live Free

One thing that I've noticed over the past few years is that it seems like there is an increase in the amount of people who refuse to take responsibility for their actions. Instead they blame others when things don't go the way they had hoped, and they subscribe to a “victim mentality”, a psychology that says there are outside forces beyond your control that are causing you to fail, and there's nothing you can do about it.

Victim Mentality: a tendency to blame external or uncontrollable factors, instead of focusing on internal or controllable factors for things that go wrong

I think if we're honest with ourselves, many of the problems we're facing today can be traced back to people who don't take responsibility for their actions, and instead act like things are just happening to them.

Much of the economic crisis we’re currently having can be placed squarely at the feet of people’s lack of responsibility. People are believing the lie that there is always someone else to blame (and someone else to depend on), and as a result when the time comes to make hard financial decisions, people are paralyzed. They feel powerless.

We live in a consuming society where if we want something – we buy it. Never mind the consequences. If we want a big new house that is over our budget? Never mind, we'll buy it anyway – after all the bank gave us a loan so we must be able to afford it! If we walk away and default, it will be their fault for giving me the loan in the first place! I run up my credit card bills? It's the credit card company's fault when I can't pay because they allowed me to have the card in the first place! I lost my job? It's not my fault for having poor job performance, it's the economy's fault! I can't win – I'm a victim!

Government Encouragement Of Irresponsibility

Let's be honest, the government hasn't exactly encouraged people to take responsibility and not play the victim. They've actually encouraged a victim mentality by giving failing banks huge bailouts, allowing them to dodge the responsibility for their poor business practices.

They've encouraged people to not find a job by continuously extending unemployment benefits for people who are out of work. They've dodged their own responsibility for many of the current fiscal crisis by shifting blame to Wall Street, big banks and mortgage companies.

They never once allowed us to believe that because of their encouragement of irresponsible lending (sub-prime lending anyone?), that much of this came about.

The point is, if you're looking to the government for some encouragement in wise spending, responsibility and moving towards a life of debt freedom, you're going to be sorely disappointed. They will encourage you to live with a victim mentality, and tell you that there isn't much you can do to succeed.

Decisions Have Consequences – Good And Bad

An article I read recently talks in depth about how the choices we make have consequences, and how so many of the great achievers in history have one thing in common – they took responsibility for their actions, whether the consequences were good or bad.

The price of greatness is responsibility

– Winston Churchill

They didn't allow themselves to be defined by the actions of others, or by the actions of their government. Instead they took responsibility for their successes and failures, and because of it they were able to live great lives.

Put all excuses aside and remember this: YOU are capable.

– Zig Ziglar

Sometimes it is only us that are responsible for the tough situations we find ourselves in. It isn't the failure of our family, our friends or our government. It is the direct result of the choices that we make.

We ARE capable, and we need to stop making excuses.

Take Control Of Your Decisions, And Their Consequences

Are there situations where people legitimately are put in bad circumstances because of others – and are being victimized? Of course. But even in those situations you have a choice that you can make – to turn a bad situation into something good, or to allow yourself to become a victim, and to allow others to define you.

I read this on another site in regards to taking responsibility, and how we can choose to live a full life, one centered by responsibility, or we can allow ourselves to be victims:

What choices are you making in your life? Are they the ones that result in positive consequences?

We can choose if we’ll reflect our environment, or if we'll affect our environment.
We can choose to be happy, or not.
We can choose how we react to hard times in our life, with positivity or negativity.
We can choose to take responsibility for our actions, or blame others for our failures.
We can choose to be a victor or take on the role of a victim.

What steps are you taking to keep yourself free of becoming a victim?

Have you allowed yourself to fall prey to a victim mentality? Has the relentless negativity in the news and in society caused you to start believing that you are a victim? What steps can we take to get ourselves out of the pit of victim-hood and despair, into the sunlight of responsibility and freedom? Tell me your thoughts in the comments!

Dave Ramsey’s 7 Baby Steps: Step 7 – Build Wealth And Give!

By Mr. Money 1 Comment

In the last post we talked about Baby Step 6, where Dave Ramsey suggests that you pay off your home early.

We looked about both sides of the argument, talking about how a paid off house can give you freedom, and allow you to save, invest and give more.

We also talked about how some suggest that it isn't the best way to go, but that you should try investing and making a better return on your money.

Ramsey suggests that the positives you get by paying off your house early far outweigh the alternative.

In today's post I'll look at the final step of the 7 baby steps – building wealth and giving to others!

I think this is one of the most exciting of the baby steps because it allows you to do something for others – using your wealth to help others.

Baby Step 7 – Build Wealth And Give

Steps 1-6 of the baby steps are focused on getting together your financial life, paying off your debt, planning ahead for the future by saving and investing.

There are men who gain from their wealth only the fear of losing it. – Antoine Riverolli

In step 7 Ramsey talks about how many people have a mistaken belief that the way to have more is to hold on tightly to what they have. In reality, it doesn't work that way he says. Instead he puts forth the idea that generous people tend to be more prosperous.

Why are generous people better off? Giving to others makes you less selfish – and people who are less selfish tend to do better in both relationships – and in wealth building.

Dave Ramsey gives the example of the open fist and the closed fist.

If you have a closed fist your money is safe and it's not going anywhere. The problem is, you can't take in any new money either. With an open hand when you give – your hand is open already, and you're able to receive blessings – as you give!

The idea of holding money with an open hand might seem to violate common sense. We feel that if we don’t hold on tightly to our money and our relationships, they will slip away. I’m not saying literally hold your money with an open hand – it represents our attitude toward money. When you give, you open yourself up. You allow the dollars to leave and the freedom to enter.
Giving works because it is in your personal blueprint to be a giver, and you unleash good things in your life that you will never see until you learn the art of unselfish giving. Giving lifts us out of ourselves; we take our eyes off our rights, our problems, and our stuff. The new view gives us renewed vision and hope. Giving is powerful. – Dave Ramsey

So when you have paid off all of your debt, and you've been able to save and invest – it's time to start giving as well! Not only will you be giving blessings to others, but you’ll be receiving blessings in return (and not always in a monetary sense).

Why Do I Give?

There are a lot of great reasons to give. Here are a few of mine:

Surplus wealth is a sacred trust to be managed for the good of others. – Andrew Carnegie

I'm a Christian, and I believe that I'm only a steward of everything I have – it all belongs to God. Psalm 24:1 says “The earth is the Lord’s, and the fullness thereof”. And since the money is all God's it sure makes it easier to give away doesn't it?
Giving is good for you! It makes you less selfish, and helps to be more Christ-like.
We are happiest when we are serving and giving.
Giving helps me to live out my life purpose of helping others.

Get Creative When You Give!

Giving doesn't always have to be monetary – you can also give of your time and talents. In the end you're only limited by your creativity. Some ways you can help:

Help a single mother buy groceries or pay a couple of bills.
Volunteer time at your church serving others.
Give an extra large tip to a waiter or waitress.
Spend time with people at a local nursing home, talking and listening to them, playing music for them or just playing games with them.
Pay for someone’s meal behind you in line at the fast food restaurant.
Serve meals at a local food shelf, and eat with them when you’re done serving.
Give to a local charity.

What are some ways that you give? Give us some suggestions in the comments!

Dave Ramsey’s 7 Baby Steps: Step 6 – Pay Off The Home Early

By Mr. Money 4 Comments

In Baby Step 5 Ramsey talked about your options for saving for your children's college education.

While I think it's a good idea to get your kids involved in helping to pay for their own education, I'm not against giving them some help as well.

I think you need to do your best to go to school and graduate debt free if you can – or with minimal debt.

Baby Step 6: Paying Off Your Home Early

In step 6 Dave suggests that you pay extra on your mortgage, and payoff your mortgage faster.

When we talk about mortgages Dave talks about how he thinks you should have no more than a 15 year fixed rate mortgage, and that your payments should be no larger than 25% of your monthly income. For many people that doesn't seem doable because of the housing markets they live in, or because of the standards they've set for the home they want to live in. Sometimes people just aim too high! In any event, in most cases it is something that most people can do – take on a 15 year loan for less than 25% of their income.

I will be the first to admit that we've taken on a 30 year mortgage at our house because when we bought the house we weren't as serious about our finances, and we were over the 25% of our income as well. At the same time we have no other debts to speak of, and since we bought the home our income has gone up – to the point where it is no longer over that 25% number. In any event, we're also paying extra on the mortgage now to help pay it off early.

So what do you get by paying off the mortgage early? You'll be giving yourself peace of mind in a tough economic climate knowing that your house is paid off. If the worst happens and you lose a job or have a medical emergency, you’ll be able to get by on a whole lot less. After all, the house is paid for!

Why You Should Pay Off The House Early

If you read personal finance blogs, there are a lot of arguments in favor and against paying off your home early. Which is the better for people financially? To pay off their mortgage early, or to save and invest the money for the long term?

First, here are some points in favor of paying off the mortgage early:

Save Money On Interest: If you pay off your mortgage off early, you'll be saving thousands of dollars in interest. Think about this: If you have a $200,000 dollar mortgage for 30 years, with an interest rate of 6%, at the end you'll have paid $250,000 in interest. Change that to a 15 year mortgage and only $115,000 in interest will be paid. If you can pay down the mortgage even faster than 15 years, you'll be saving even more because you'll be paying less interest.
Mitigate Your Risk: One of the most attractive things about paying off the mortgage early to me is the fact that it helps to minimize the amount of risk that you have in your life. With a paid off house you don't have to worry about mortgage payments. If you can scrape enough together to pay for food, transportation, clothing and utilities, you should be able to get by. Without a mortgage that number is significantly lower. Trying to invest the money and come out ahead may work for some, but because investing is inherently risky (we've seen that in the last year or two), it could mean adding risk to your life as well.
Financial And Emotional Peace + Less Stress: With no mortgage I know that we would be much closer to true financial and emotional peace just because we wouldn't have the debt weighing on our shoulders – and the risk of losing our home to a job loss or medical issue are greatly reduced. So less debts and obligations mean less stress in our household. Add to that the fact that you’ll have less stress when having to deal with a job change, or wanting to become a one income family so one spouse can stay home with the children. When you have a paid for house you’ll only need to cover the minimum of life's essentials – and you'll have walkaway power – power to walk away from any job you don’t love or enjoy because you only have minimal expenses!
With A Paid Off Mortgage You Get A Huge Raise!: When your monthly debt obligation drops so significantly because you've paid off your house, it means that your income will go up significantly. Can you imagine how much money you could save, invest and give if you didn't have a mortgage?

Being debt free brings freedom, and sometimes that’s better than a few extra dollars made through investments.

Arguments For Investing Instead Of Paying Extra On House

There are some pretty good arguments that others have made against making extra payments on a house. Here are the few that made the most sense to me:

Keeping Your Holdings Liquid = Flexibility: When you have your money in investments as opposed to prepaying on a house, the money is going to be more accessible if you absolutely need to access it. When your money is being invested in a house, you can't exactly just cash it out – you still need a place to live. So many would suggest that investing your money will give you more flexibility in the case you need to access your money in an emergency.
Returns On Investing Will Be Higher: If the money you expect to make in the stock market is more than the amount you'll save by pre-paying your mortgage, than it may be a better bet to invest your money.
Inflation Is Your Friend?: Inflation goes up by a rate of 3-4% every year, so by not prepaying your mortgage you are in essence paying less money for a house that is increasing in value every year. The amount you pay in 2040 to live in your house is the same as you're paying in 2010. You'll be getting more for your money!
No Asset Diversification: By only investing in your house, some argue that you're not properly diversifying your holdings – you're only investing in one asset type and class. Better to invest and diversify your holdings.

The arguments for investing vs. paying off your mortgage early really do make a good case, although I will admit some of them hold less merit for me than others.

What We're Doing

We've considered both sides of the argument at our house, and in the end the thought of having a paid off house – and no mortgage debt – just appealed to us more. We love the idea of having the freedom and the walkaway power that goes along with having a paid off mortgage.

At the same time, we still want to invest. So what we're doing at our house is a little of both. We're both investing for our future, and we're pre-paying our mortgage to the tune of several payments per year. We may not pay off the house as fast this way, but we'll still be paying it off years early.

What do you think about paying off the house early? Do you think it’s a good idea or a bad idea? Which path are you choosing if you’re at that point? Tell us in the comments!

Dave Ramsey’s 7 Baby Steps: Baby Step 5 – College Funding For Children

By Mr. Money Leave a Comment

In baby steps 1-4 we worked towards paying off debt, building up an emergency fund and investing 15-20% of our income. In baby step 5 we look at saving for your children's education.

Baby Step 5: College Funding For Children

Baby step 5 talks about how if you've taken care of your other priorities first (like saving for your own retirement), you can save up and help pay for your child's education.

One thing that Dave Ramsey stresses, however is that you don’t have to go into debt for your child to go to college. Once you've taken care of your baby steps 1-4, start saving up a nest egg to help them pay for their education. Beyond saving for their education, also encourage them to take an active part in their own education, get good grades, and help pay for their education through grants, scholarships and other free money. If they're involved in paying for their own education, they'll be more invested in it.

Here are some ways that you can save for your kid's college education.

Education Savings Account (ESA): You may save $2,000 (after tax) per year, per child that grows tax free! Beneficiary must be under 18 years old. Money must be used for education purposes only. Otherwise, a 10% penalty and taxes will apply. Money must be used or rolled over to a qualifying family member by age 30 or a 10% penalty and taxes will apply. Singles with an income over $110,000 – or married couples with an income over $220,000 are not eligible.
529 Plan: If you do not meet the income limits for an ESA, or if you want to save money above an ESA, you can use a certain kind of 529 plan. You can save up to $12,000 per year, per child in a 529 plan. The money must be used for higher education only. Otherwise, a 10% penalty and taxes will apply to the gains only.
UTMA/UGMA Plans: UTMA (or UGMA) stands for Uniform Transfer (Gift) to Minors Act. Not usually as good as the ESA or 529 plans.

Here are some ways that Dave Ramsey thinks should never be used to fund your child’s education. Beware of these things:

Insurance
Savings bonds (only 5-6% growth)
Zero-coupon bonds. (only 6-8% growth)
Pre-paid college tuition (only 7% inflation rate)
401k loan (never!)
Home equity loan

ESAs, 529 Plans and UTMA/UGMA plans are preferred by Ramsey.

Should Other Things Come Before Your Kid's College Funding?

Providing for your child's education is an emotional topic, and for many people providing for their kid's and their schooling is so important it comes before they have reached baby step 5 in the process. They think that by not funding their child’s education until they have all their debt paid off or retirement funded that somehow they are being self absorbed or that they're harming their child.

In my opinion you do more harm if you don't do baby steps 1-4 first. Your kids can always help pay for their own education through grants, scholarships and loans. On the other hand, if you don't get money saved for retirement, and get all your other financial ducks in a row, your child could end up having to support you or pay for your care in the future. You don't want to saddle them with that responsibility do you? Better to get your financial house in order first, and then help where you can. If you can get out of debt, save for retirement and then help pay for their schooling as well – even better!

Here's why I believe it's a good idea to get out of debt and save for retirement first.

Making sure your retirement is provided for takes a burden off of your children later on.
Set a good example for your children by showing them how to properly manage your finances.
Having to pay for part of your education helps build character and makes the education mean more.
Encouraging them to do well ins school to help pay for their own university training will help promote responsibility.

Personally I think that even if you are able to pay for your child’s schooling outright, it’s a good idea to have them participate in paying for their own schooling. They can do that either by saving up for college through after school jobs, getting good grades that lead to grants and scholarships, and by going to in-state schools that cost less. Here's a post on another site talking about these ideas.

Dave Barry says it better than I can:

I believe that we parents must encourage our children to become educated so they can get into a good college that we cannot afford. – Dave Barry

In baby step 5 Dave Ramsey encourages us to take control of our financial lives, and take care of our own debts and retirement savings before helping our children to pay for college. Once we've completed steps 1-4, however, he suggests it's a good idea to help them pay for college by saving money in an ESA, 529 savings plan or a UTMA/UGMA Plan.

What’s your opinion of paying for your kid’s college? Are you saving for their college funds? Will they have to pay for part of it themselves? Let us know in the comments.

Dave Ramsey’s 7 Baby Steps: Step 4 – Invest 15% (Or More!) Of Your Income

By Mr. Money Leave a Comment

Last time in the baby steps series we looked at baby step 3, saving up 3-6 months of expenses. You never know when you're going to have an unplanned expense like a major medical event or a job loss. It's best to plan ahead and be ready when those things happen, because, they will happen!

Today in baby step 4 we want to look at the things you should do once your debt is gone and you've saved up a 3-6 month emergency fund (or more like we have). It's time to invest!

Baby Step 4: Invest 15% Of Gross Income Into Roth IRAs And Pre-Tax Retirement

Baby step 4 is for me the point in the process where you realize that you've reached the top of the hill, and from now on you'll be coasting downhill saving up for retirement. It's an exciting step in my opinion. You’ve finally paid off your debts (except the house) and built up your big emergency fund, and now it’s time to save in a variety of places to fund your retirement!

Ramsey suggest saving 15% of your household income in good solid long term investments. Personally I think 15% is a good starting number – although I would love to save even more!

Why Is 15% A Good Number To Invest?

To give a graphical display of why saving 15% for your retirement is suggested by Dave Ramsey, I went and inputted some numbers into his investment calculator. I put in these numbers:

Making $100,000 a year
Saving 15%
$1250/month invested (15% of 100k)
Starting at age 30
Saving for 30 years
8% return on the investments (Ramsey suggests a 10% return, I'm a bit more conservative)

When you put in those numbers above, it comes up with a return of well over 1.875 million dollars by the age of 60.

If you were to keep it going even for 5 more years until the age of 65, the account would grow to over 2.794 million dollars. That’s not half bad!

Ramsey actually suggests that you'll see returns in excess of 10% on your investments. While I don't think it's impossible, I do think that a more realistic number is around 8%. Be conservative in your planning and if your returns are more – great!

What Should I Invest In?

Now that we've decided on 15% or so to invest, we need to look at what investment vehicles we want to use. Ramsey suggests:

If you receive a company match in your 401(k), 403(b), or TSP; invest in those plans, up to the match, first. Once your contribution equals the company match, fully fund a Roth IRA for you and your spouse. If you’ve maxed out your contribution to your Roth IRA and still have money to invest, invest the rest in your 401(k), 403(b), or TSP.

So he suggests that you invest in:

Company 401k or other plan up to the match. (free 100% return!)
Roth IRA for you and spouse if you have one.
Max out the 401k or other plan

In your company 401k, Roth IRA or Traditional IRA, Dave suggests allocating your investments with a good mix of mutual funds. His preferred plan is to allocate 25% to each of the following types of stocks in your funds:

Growth
Growth & Income
Aggressive Growth
International

Personally I've been a bit wary of Dave's investing advice as a lot of very smart people have suggested that his strategy of using front end loaded mutual funds means you'll be paying a ton in fees – and your returns won't be more than just investing in a good index fund, or other low cost investments. That may be an argument for another day – but I think we can all agree – that investing 15% or more is a great idea for everyone – the earlier you get started, the better.

What do you think about baby step 4 – is 15% be enough for you to save for your retirement? Do you think you should save more or less? Do you have another strategy? Tell us about it in the comments.

M1 Finance Review: The Fee Free Self-Directed Brokerage

By Mr. Money 1 Comment

As a long-term investor, I do everything I can to ensure that my returns are as high as possible over the long haul.

What sort of things am I doing to ensure that I come out ahead?

I'm doing my best to keep my investments diversified, and keeping the costs for my investing low. Typically people can see fees, commissions, expense ratios, and account costs eat into their end returns, and it doesn't have to be that way. There are now free alternatives!

I recently discovered a new hybrid brokerage and robo-advisor called M1 Finance. They give you the flexibility to invest in their preset portfolios using diversified ETF index funds, or you can invest in individual stocks, like with a traditional brokerage. Best of all, they're fee-free!

In this review, we'll take a deep dive on M1 Finance and what they have to offer, so let's get started.

M1 Finance Founding

M1 Finance launched in September of 2016. 25-year-old Stanford graduate, Brian Barnes, founded the company. From Business Insider:

When Brian Barnes graduated from Stanford in 2012, he had a hard time finding a tool with which he could invest in the stock market on his own. This prompted him to start his own online brokerage site, M1 Finance, at 25 years old.“What I was trying to do seemed relatively basic,” Barnes penned in a recent post on M1's site. “I wanted to be able to pick my investments, and have recurring deposits automatically added to those allocations.”And that's exactly what M1, which has $60 million under management, allows users to do. M1 users can pick the stocks they want to invest in and then they can determine what percentage of their portfolio they want each position to make up. M1 automatically updates as you put in more money and as stock prices fluctuate to maintain your preferred portfolio allocation. So if you want Apple to make up 25% of your portfolio, M1 will balance your portfolio as such. That means you can't buy one Apple share, or one Amazon share. It's all about the portfolio.

M1 Finance gives you the automated investing tools of a robo-advisor, with fine control over your individual investments like a traditional brokerage.

The cost of using M1 Finance is pretty darn cheap. It's FREE to use the basic service! So let's get into the details.

M1 Finance – Opening An Account

To open an account with M1 Finance first you have to choose what type of account you want to open:

Taxable Investment Accounts
Roth IRA
SEP IRA
Traditional IRA
Trust Accounts
Rollover IRA

There is a 3-step process. First, you'll enter basic details like name, email, and password, and then you proceed to:

Build Your Portfolio: M1 Finance's “Pie” portfolio concept will be introduced, and you'll walk through the process of creating your portfolio.
Start Your Brokerage Account: Choose your account type and complete your profile details for your account.
Deposit Money Into Your Account: Link your account that you'll use to fund your M1 Finance account.

There is no minimum amount to open an account, but to invest you'll need at least $100 in your account. Personally, I decided to drop $1000 in there right away to get started. Your free account can be opened through the link below.

Open Your FREE M1 Finance Account Now

The Details Of How M1 Finance Works

M1 Finance is one of the most flexible robo-advisors available at this time. Many robo-advisors will give you the option of only a few pre-built investment portfolios, ones they've built for a general audience. Usually, the only changes you can make are to the ratio of stocks to bonds included in the account.

M1 Finance gives you granular control over your investments if you want it.

Pie Investing

M1 Finance has an investing concept that they use where they call individual investment portfolios “pies”.

Pies are the basic organizational structure for your investments. The pie can have as many as 100 slices to it. Each slice can be an individual stock, an ETF, or even another set of investments via another pie.

Each slice that you've added to your pie is assigned a percentage of the total pie, and when dividends are paid out, or funds are added to your account, the system will do its best to ensure that the percentages stay consistent.

If you're not adventurous and want M1 Finance to do the work for you, they have over 60 pre-built pies that you can choose from. Want to choose one of their pies and then add a couple of individual stocks to it? You can do that too!

Pie Types

The pies that M1 has created are broken down into 8 types or categories

General Investing: Build a diversified portfolio that's based on your personal level of risk tolerance.
Plan for Retirement: Invest in a portfolio tailored for you and your target retirement date.
Responsible Investing: Invest in socially and environmentally friendly investments.
Income Earners: Choose investments based on dividends and income returns.
Hedge Fund Followers: Aims to emulate the strategies of successful investors and hedge funds with good reputations.
Industries and Sectors: Invest in specific sectors like aerospace, biotech, and more.
Just Stocks and Bonds: Gives you a highly diversified portfolio with a total world stock fund, and a bond fund.
Other Strategies: Other popular investment strategies that you can use to meet your goals.

Create Your Pies And Start Investing

Once you have chosen a stock pie from M1, or have customized your own, the pies will now live in your dashboard. You can add as many (or as few) pies to your account as you want, with the one caveat that a “portfolio generally cannot hold over 500 individual positions“.

Once your pies are built and saved in your dashboard, there are a few things to remember.

All trades are made by M1 Finance at 9 AM central on days that the New York Stock Exchange is open for business.
Once the amount of cash in the account reaches $10, it will be auto-invested.
For every new contribution or dividend deposit, M1 will invest those funds into under-weighted slices of your pies to bring them into balance. New contributions and dividend reinvestment will aid in automatic re-balancing.
You can do a manual account re-balance as well through your dashboard, either on a specific pie, or on your whole portfolio.

M1 Finance Apps On Mobile

M1 Finance has well-reviewed mobile apps available for both iOS and Android. I've tried it and it looks great!

The apps allow you to do most things you can do on the website including creating your portfolios, setting up automated investments, re-balancing your portfolio pies, and more.

M1 Borrow

Earlier this year M1 Finance announced a new feature of their accounts that would allow you to borrow money from M1 Finance at a rate that is extremely low, 4%.

How does it work? Let's say you want to build a deck on your house. You can instantly borrow up to 35% of your account balance at a low rate of 4% to make that happen.

There is a caveat. Your brokerage account has to have a $10,000 balance or greater.

How does 4% rate compare when looking at other traditional loan types? It compares pretty favorably.

The nice thing about borrowing from your account is that there is no paperwork, credit checks or application denials to worry about. Just have an account with $10k balance and you'll be able to borrow up to 35% of the balance at a rate lower than you can find in most other places.

M1 Finance Comissions & Fees

One of the biggest pros that M1 Finance has at this time is the fact that they are a fee-free service, and there is no minimum to open an account.

If you want to invest your funds there is a $100 minimum with a taxable account, and a $500 minimum for retirement (IRA / Roth IRA) accounts. That's still a pretty low bar for most folks.

M1 Finance used to have an annual management fee for assets under management, but they made a positive change and dropped that fee. The following things are all now fee-free:

Management fee: FREE
Trading fees: FREE
Re-balancing fees: FREE
Dividend reinvestment fee: FREE

If you're looking for where some fees might reside, M1 Finance does have fees related to transferring funds via wire transfer, or to do a full account transfer out. That's pretty standard though, and regular electronic funds transfers (EFT) are free. To see a full listing of their administrative fees see their fees disclosure page.

M1 Finance – Flexible, Low Cost, Easy To Use

M1 Finance is a cool new investing platform, and it's one of the best I've come upon in the last few years.

They're similar in some ways to other robo-advisor platforms in that you can deposit your money, and choose a preset investment portfolio, and set it to auto-invest, but they're much more flexible than most.

Not only do they have pre-built portfolios, but you can create your own investment pies that include any combination of stocks, bonds, or other pies. Just find what you want to invest in and add it to your pie – there are no trading fees!

M1 Finance is one of the more innovative, low-cost investing companies available for regular investors. I recommend giving it a try.

Open your free account through the link below.

Get Your M1 Finance Account Now!

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