A FinTech brokerage has officially launched its latest AI tool.
About M1 Advisor:
This week, M1 introduced M1 Advisor. Billed as a fiduciary AI financial advisor, the new tool is built into the platform and can offer personalized insights to clients.
The AI-powered M1 Advisor will be able to view information across clients’ various M1 accounts, including balances, positions, and rates. Moreover, customers can link external accounts such as IRAs, 401(k)s, loans, mortgages, and more via Plaid. With a fuller financial picture, M1 Advisor can provide clients wth more specific advice. That said, M1 highlights that the advisor is not able to act on its own. Instead, clients are able to ask questions, get answers, and then make their own decisions.
M1 states that the new M1 Advisor will be free to all clients through the end of 2027. Enrollment is also opt-in. As M1 notes, human financial advisors often charge 1% or more of total assets on an annual basis. Alternatively, flat fees for financial planning average $6,815 per year according to an Envestnet study.
Currently, M1 charges a $3 monthly Platform Fee, which can be waived for those with at least $10,000 in total M1 assets or who have an active M1 Personal Loan.
What They’re Saying:
Announcing this new feature, M1 founder and CEO Brian Barnes said, “Financial advice has been priced like a luxury good for people who already had money and its supply was capped by the number of humans doing the work. Human advisors provide immense value, but there are far more people who need financial advice than human advisors who have hours to serve. AI removes that cap.”
Barned added, “M1 Advisor is an AI financial advisor that gives people advice built on their actual accounts, under the same fiduciary duty a human advisor owes them.”
My Thoughts:
At this point, all of these different AI financial advisors start to sound similar. However, there is one word here that stands out: fiduciary. From what I can tell, since M1 Advisor is being offered by the SEC-registered M1 Advisory Services, that’s where the fiduciary standard comes in. Still, it does strike me as a bit odd to suggest that an AI is a fiduciary — even if that’s a good thing overall.
I also want to give M1 credit for a few other things I think they’re doing right here. First, I love that this advisor is opt-in, allowing clients who don’t want to deal with the AI to stay away. Also, keeping the tool free for at least the next 15 months or so is commendable.
Admittedly, I’ve used M1 in the past but haven’t for a while. Perhaps it’s time I return just to check out this latest tool.
