Motif Investing Review: A Game Changer For Investors

motif investing reviewAs every day passes, there seems to come another online broker that has a slight twist on the traditional way of investing money. First came Charles Schwab, who brought no-fee ETF trading to the world.

Then came firms like Betterment, who automate investing for you. Now comes Motif Investing, who allows you to create your own basket of stocks (or motifs) for one low price.

From the first time I heard of Motif Investing, I was intrigued at what they offered, the ability to buy stocks for one low price.

So I dug around and got the inside scoop on what makes them unique. I quickly realized that you can be a successful investor investing with Motif over the long term.

This is my detailed review of their service, both the good and the bad, so you can see if they are a fit for your investment goals.

With that said, let’s learn some more about Motif Investing.

Motif Investing Review Summary
  • Ease of Use
  • Account Fees
  • Account Types
  • Features
  • Customer Service

Summary

Motif Investing is a little different than most of the online brokers out there. They allow you to buy a basket or 'motif' of stocks for one low price. While great when they came on the scene, they have now been surpassed by new players in the industry.

4.1

My Motif Investing Review

Motif Investing Background and History

Motif Investing started back in 2010 because two people wanted a lower cost way to turn their ideas into investments. Today, they are a serious player in the investing world and have even been named to CNBC’s Disruptor 50 list. You can read all about the mission of Motif here.

Now, before we move on, we need to address the elephant in the room, what is a motif anyways? Basically a motif is a basket of stocks that when combined, create a motif. You can either choose a pre-made motif or create your own. This video gives a nice rundown on the service.

Motif Investing Features

OK, now on to the features that makes Motif Investing so great for investors. I’ll highlight these in bullet points and then go into more detail:

  • $9.95 trades. You invest in any motif for a flat fee of $9.95.
  • Thousands of motifs to choose from. There are thousands of motifs that have already been created for you to invest in. Simply browse through the site and find the one that fits your goals and objectives.
  • Create your own motif. Maybe you are very picky in what you are looking for. In this case, you can create your own motif. Just pick the underlying investments and you are all set.
  • Diversification. Because you are buying into 30 stocks at once, you can get great diversification from the start (unless you only invest in one sector, like banking stocks).
  • Easy to use website. There is a lot to be said when you find a website that is easy to navigate and find what you are looking for. I found this to be the case with Motif Investing. I had no issues finding what I was looking for.
  • Ability to make extra money. If you create your own motif and others invest in it, you earn a small commission! You can read more about this program here.

Motif Investing Benefits

The overall benefit of Motif Investing is that you can invest in up to 30 stocks at once, for a low price of $9.95. If you were to buy each of the 30 stocks from another discount broker, you would be looking at a cost of over $200!

While that is a great deal, what is just as good of a deal is that you can completely customize your motif to your liking. When I was on the site I was looking for dividend motifs. I did the work ahead of time to know which companies I wanted to invest in. After some time, I realized that there was not a current motif that had the investments I wanted. So I set out to create my own motif. It’s like Burger King, where you get it the way you want it!

Other benefits include:

Low Account Minimum: While the site says there is no minimum, they do tell you to start off with $250. You can’t beat that as a low cost way to get started investing!

Investing DNA Assessment: Not sure where to invest your money? No worries as Motif has a cool assessment survey for you to take that will guide you to make the best investment choices for you. Here is a link to the assessment for you to check out.

Lower Cost Trading: Let’s say you get to a point where you want to add to one position within your motif. It’s easy to do this and the cost for doing so is only $4.95. That is a great deal to trade a stock.

Horizon Motifs: The Horizon Motifs are 9 ETF based motifs that you can invest in for free. While the underlying ETFs do have management fees that you will still pay (you pay this fee if you invest in any ETF anywhere, not just with Motif Investing), this is a great option for investors. It is basically investing in Betterment without the fee that Betterment charges.

No Fees: Other than the commission you pay to invest, there are no other trading fees or account maintenance fees with Motif Investing.

Amazing Customer Service. You can email or call customer service or even watch one of the many explainer videos on their website to understand things better.

If Motif sounds like it is the right fit for you, you can open your account here.

Downsides To Motif Investing

There are a few downsides to Motif Investing to list. Luckily, there are just a couple and for many investors are not a deal-breaker.

Account Close Fee: You will find this with many brokerages, so it is not a knock solely against Motif Investing. If you close your account with them you get charged $65 and if you close your IRA with them you are charged $95.

No Dividend Reinvestment Plan: As of this writing there is no automatic dividend reinvestment plan with Motif Investing. When you do get dividends, they will go to your cash account where you can choose to invest at a later time.

Lack Of Staying Current: When Motif first came on the scene, they were a game changer. But sadly, they seem to be sitting idle and not adding new features or offering anything new. As a result, new players have come into the industry and in many cases, are doing things better and cheaper than Motif.

Who Is Motif Investing For?

Motif Investing is a great option for dividend investors. You can buy a basket of stocks for $9.95. Seeing as how most online brokers charge $5 for buying just one stock, this is a good deal.

If Motif Investing sounds like a fit for you, you can click on this link to sign up.

For most other investors, there are better options out there. And to be honest, for dividend investors, there is a better option too.

Regardless of which online broker you do choose, you should check out my book, 7 Investing Steps That Will Make You Wealthy, to ensure you earn the highest return with the least risk possible.

Alternatives To Motif Investing

Who are some of the competitors to Motif Investing? Here is a short list.

M1 Finance: This company is basically a clone of Motif in that you can build a portfolio of stocks or ETFs or use a pre-built portfolio. But where they differ from Motif is that you can do this for free. That is right, there is no trading fees with M1. I use them as my dividend investment portfolio and save the $10 trade fee. You can get started with M1 Finance here.

Are you looking for the best online broker for your needs? Check out my broker comparison chart to find the perfect match for you.

Wealthsimple: This is a robo-advisor with a twist. While most robo-advisors charge you a fee from day one, Wealthsimple doesn’t charge you until your balance is over $5,000. This makes them a great option for buy and hold investors. You can get started with Wealthsimple here.

Stockpile: Another option for investing in stocks is Stockpile. You can buy individual stocks here for $0.99 a trade. It’s a great option for those not looking for build an entire portfolio but want just a few stock holdings. What’s really cool about Stockpile is they were created to help parents and relatives easily buy stock for their children and grandkids. You can get started with Stockpile here.

Final Thoughts

At the end of the day, I was a big fan of Motif Investing when they first came out. They were disrupting the industry just like online brokers did in the late 1990’s. Unfortunately, they lost sight of their goal and haven’t done anything to stay relevant.

While they are a solid firm, I just can’t recommend you build a portfolio and buy stock for $9.95 when you can do the exact same thing for free with M1 Finance.

6 thoughts on “Motif Investing Review: A Game Changer For Investors”

    1. Sign up bonuses are great! I just really like the idea behind the service. So much better than paying for each trade individually.

  1. I do want to diversify. Motif actually allows me to do that in that each motif I set up can essentially be an index fund – one either I’ve created or one they’ve created. They can hold up to 30 stocks, so I should be able (generally speaking of course) to diversify. Honestly, some of the interesting questions are in Motif the following: What is minimum trade amount allowed? What is the minimum of the motif size for the small investor?

  2. Jon thanks for the write on Motif. $250 is a great way to start investing. Consistency is the key.

    1. The thing I like most is that you can trade a bunch of stocks for just $9.95. It would cost a ton more at other brokers.

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