M1 Finance Investing Platform
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Many of us have learned that if something seems too good to be true, it is. Is that the case with the investment platform M1 Finance?
M1 Finance is a member of the Financial Industry Regulatory Authority (better known as FINRA). The purpose of FINRA is to protect you, the investor. FINRA is a not for profit organization authorized by congress to protect America’s investors and regulate brokers like M1 Finance.
FINRA has written rules that all registered broker dealers and registered brokers in the United States must follow. These rules are written and enforced by FINRA.
FINRA offers a free tool called BrokerCheck where you can learn more about brokers and broker dealers operating in the United States.
Second of all, M1 Finance is a member of the Securities and Investor Protection Corporation (SIPC).
When a brokerage firm is closed, SIPC steps in and, within certain limits, works to return your cash, stock, and other securities you had at the firm.
Being a member of SIPC, you will be insured in the event that M1 Finance goes out of business or goes financially insolvent.
Each account at M1 Finance is insured with up to $500,000 in coverage ($250,000 for cash). It is important to understand that SIPC does not insure you in the event of a decline in the value of your M1 Finance investments.
You might be wondering if M1 Finance is FDIC insured. They are not, as FDIC insurance is only for bank holdings.
M1 Finance is a regulated brokerage account that is in compliance with both the SPIC and FINRA. If you have any doubts about this platform, read the BrokerCheck report here.