How to Make Money on M1 Finance: A Comprehensive Guide
Are you looking to diversify your investment portfolio and potentially earn more money? M1 Finance might just be the platform you’re looking for. M1 Finance is a unique investment app that allows users to invest in a variety of assets, including stocks, ETFs, and bonds. But how can you make money on M1 Finance? Let’s dive into the details.
Understanding M1 Finance
M1 Finance is an investment app that offers a unique approach to investing. Instead of buying individual stocks or ETFs, users can create a “Portfolio” by selecting from a list of pre-built portfolios or by customizing their own. These portfolios are made up of a mix of stocks, ETFs, and bonds, allowing users to diversify their investments.
One of the key features of M1 Finance is the ability to invest in fractional shares. This means that you can invest as little as $1 in a stock or ETF, making it accessible to investors with smaller budgets.
Creating Your Portfolio
When you first sign up for M1 Finance, you’ll be prompted to create a portfolio. You can choose from a variety of pre-built portfolios, such as the “Aggressive Growth” or “Income” portfolios, or you can create your own custom portfolio.
Here’s how to create a custom portfolio:
- Log in to your M1 Finance account.
- Click on the “Create Portfolio” button.
- Select the “Custom” option.
- Choose the assets you want to include in your portfolio. You can search for specific stocks or ETFs, or browse through the available options.
- Set the desired allocation for each asset.
- Click “Create Portfolio” to finalize your portfolio.
Investing in Fractional Shares
One of the most appealing features of M1 Finance is the ability to invest in fractional shares. This means that you can invest as little as $1 in a stock or ETF, which is great for investors with smaller budgets.
Here’s how to invest in fractional shares:
- Log in to your M1 Finance account.
- Go to the “Invest” tab.
- Select the stock or ETF you want to invest in.
- Enter the amount you want to invest. If you want to invest in fractional shares, simply enter the amount you want to invest, and M1 Finance will automatically purchase the fractional shares for you.
- Click “Invest” to complete your transaction.
Understanding Dividends and Reinvestments
One of the ways you can make money on M1 Finance is through dividends. When you own stocks or ETFs that pay dividends, you’ll receive a portion of the company’s profits. M1 Finance allows you to reinvest these dividends back into your portfolio, which can help your investments grow over time.
Here’s how dividends and reinvestments work on M1 Finance:
- When a stock or ETF in your portfolio pays a dividend, M1 Finance will automatically reinvest the dividend into your portfolio.
- The reinvested dividends will be used to purchase additional fractional shares of the same stock or ETF.
- This process continues over time, allowing your portfolio to grow through the reinvestment of dividends.
Using the M1 Finance App
M1 Finance offers a user-friendly mobile app that allows you to manage your investments on the go. The app provides real-time updates on your portfolio, including the value of your investments, the number of shares you own, and any dividends you’ve received.
Here are some of the key features of the M1 Finance app:
- Real-time portfolio tracking
- Dividend reinvestment
- Customizable alerts
- Access to your investment history
Monitoring Your Investments
It’s important to regularly monitor your investments to ensure they align with your financial goals. M1 Finance provides a variety of tools to help you track your portfolio’s performance, including:
- Portfolio performance charts
- Historical returns
- Dividend yield
- Asset allocation
