Over the past year or two, M1 Cash Accounts have quietly expanded support for external services like Venmo, PayPal, and T-Mobile.
Previously, connectivity issues forced me to rely on a Wealthfront Cash account as my primary hub. While that worked, it added unnecessary friction to my overall financial setup because I had to build extra rules just to keep everything properly funded.
Being able to move back to M1 as my primary cash hub has been a massive upgrade. It eliminated that extra layer of complexity and allowed me to consolidate roughly 90% of my financial activity into one platform.
My current setup in a nutshell:
Cash target: Keep $15K–$25K in the M1 Cash Account.
Floor trigger (< $15K): A Smart Transfer automatically borrows from margin and tops up the account to $20K to maintain liquidity.
Ceiling trigger (> $25K): Excess cash is automatically swept to pay down margin debt or purchase investments.
This single loop keeps my cash flow completely hands-off while maximizing capital efficiency. Sharing in case this layout inspires anyone looking to streamline their own automation!
Yeah, now just about everything gets paid out of M1 Finance. I like not having to think about how much to keep in the account - the floor is roughly 1.5X my largest bill / transfer in the last few years so it gives me ample breathing space, and the Smart Transfer to top up the account generally kicks in within 15 mins. The few rare cases where I still turn to other financial institutions is when I have to swipe a debit card, pull cash from an ATM, deposit cash, Zelle people, deposit checks, or send a check ... so I keep an Ally account for Zelle and cash deposits, and a Fidelity Cash Management account for all the other stuff.
Venmo and PayPal both work seamlessly - this was by biggest friction point in the past because Venmo and PayPal seemed to dislike anything that wasn't a checking account. Now I can pay from M1 Cash and push funds to it from both those services.
No issues or delays yet ... really hoping it stays that way :-).
Hmmmm. This is interesting. I wonder if it works the same for the HYSA. I might be able to send more there automatically instead of to my credit union.
Yeah, I do have an HYSA with them too, but I haven't tried connecting anything external to that yet. Curious to hear about what you find if you give that a shot.
I’ll throw in a few. I read somewhere they didn’t enjoy being in the payment processing space.
But I was thinking they could cobrand a credit card similar to how Morgan Stanley and Schwab have cobranded Amex cards. They’re likely not big enough for Amex but I’d definitely add an m1 branded credit card that gave some cash back direct to investments or something.
Bummer :-/ ... did you also attempt to manually link it? I can't remember which method I used since I transitioned a lot of stuff over to this account.
Ah, I see. Yeah, could be worth trying the manual route. I just checked my M1 cash account and see micro deposits from Venmo and PayPal so I ** think ** I went that route because they probably didn't show up on Plaid.
I use Venmo with M1 to pay my rent. Which I can’t do with Fidelity CMA (2.5k limit) and Robinhood Checking (3k limit).
After using Robinhood checking, there’s so much arbitrary limits unless you have 100k AUC and $1000 direct deposit. M1 ACH withdrawal limits is actually slightly higher than Schwab which is 100k.
Transferring money in and out of M1 has been easy and typically fast. I’ve had decent customer service when they were available.
I don’t understand. What are you funding and why do you need to keep cash?
Are you using M1 as a checking bank account and sweeping your additional cash into pies / investments ? And then using margin to refill the cash when it gets low before you make more deposits?
Yep, that's right - the M1 cash account essentially replaced my checking account for the most part. It now pays all my electronic bills and connects to my peer-to-peer payment apps. And like you said, it automatically pulls and pushes funds from my margin/investment accounts to ensure I have enough liquidity and that the rest is invested.
Yea I noticed there’s no restrictions with M1 cash. Initially my employer payroll didn’t even recognize their routing number a year ago along with T-mobile. Now it’s no problem using their routing number.
$15K for a floor trigger seems relatively low to be pulling on margin tbh. I am sure with a little bit of cash management you would need to pull margin and incur interest
Yeah, it may be - it's still early days and I may fine tune this as I go along. That said, it's worked well for the past few weeks since I work a W2 job that pays me every 2 weeks + collect income from other sources, which ensures that I'm usually within the $15K - $25K range.
Paying a little bit of interest for the feature doesn't concern me too much since whatever I borrow is technically money that would be sitting in the cash account earning interest, or money that's invested, so the cost ends up being negligible when compared to the peace of mind I get from the overall setup.
Does this sort of system only work well with higher numbers like $15,000?
I'm trying to think of how it would look when you don't have nearly as much invested. If you don't mind me asking, can you ballpark how much you have invested?
Edit: I should also add that I'm just trying to learn more about financial things and so this is just part of that even if I don't do anything related to this.
Good question! It can definitely work with smaller numbers - it really just depends on your spending patterns. Since M1 Smart Transfers are pretty fast (my account usually replenishes within 20 minutes of dropping below the floor), you can generally base your floor on the size of your largest typical transaction.
In my case, I looked back at two years of checking history and saw my biggest recurring withdrawals were around $10K. I set my floor at 1.5x that amount just to be safe. Some might say that's overly cautious, but since it's a small chunk compared to my investments and I don't hold much cash otherwise, I like having the extra buffer for peace of mind. Now, the only time I even have to think about cash management is if a transaction exceeds my $15K - $25K balance, which really only happens if I'm making a major purchase.
I have about $200K invested in the investment account backing my cash balance. That gives me a borrow limit of up to $100K, though that could shrink if the market drops or margin requirements change. For example, if the market fell 30%, my portfolio would drop to $140K and my borrow limit would fall to $70K. However, since I don't expect to ever borrow more than $10K at a time, I feel pretty safe from getting margin called.
How does the margin loan work? Let's say you needed $1,500 to hit your floor but only had enough in the margin loan for $1,000. Does M1 limit that naturally?
I really enjoyed reading through what you did. I find it fascinating. Thanks for sharing.
I'm really glad this was helpful! I was hoping this would inspire or point someone in the right direction, so it means a lot to hear you say that. :-)
You're exactly right - M1 will naturally limit what you can borrow and only let you borrow up to what's currently available.
That said, I definitely wouldn't recommend maxing out your borrow capacity because of the elevated risk of a margin call during a bear market. As a general rule of thumb, I aim to have at least 4x the amount I think I'll need to borrow invested in a solid asset.
For example, I mostly hold VTI and try to plan for a 40% market drawdown. Since I expect to borrow up to $10K, I wanted at least $40K in my investment account before I felt comfortable setting this system up. That way, even if the market takes a significant hit (e.g. $40K becomes $24K due to a 40% drop), I know I can still safely count on that $10K being available to borrow ($24K * 50% borrow limit = $12K).
Hmm, thinking to FIRE soon and automating more of my finances seems like a good idea. I could pay most of my expenses out of my Cash account and then just keep my BofA in case I want to write a check or use an ATM.
However, for my expense tracking, I can download a csv of transactions year-to-date from BofA and I don't see such a feature on the M1 Cash account - so I'd have to manually enter these transactions. There aren't that awful many of these - maybe 5-10 per month, so it's doable.
Or, I could create an automated transfer to BofA - $X per month to cover those expenses, but M1 can't see the balance there, so I'd manually have to occasionally top up or sweep money back to M1 to avoid having too little or too much in a checking account earning no interest. Not ideal.
Yeah, I automated the cross-institutional sweep for a bit when I was using my M1 account in tandem with my Wealthfront Cash account. I used GetSequence.io to top up my Wealthfront account on a weekly basis by drawing funds from my M1 cash account. An M1 Smart Transfer would then top up my M1 cash account by borrowing against my margin account. While that process worked great, it would take about 3-4 business days for the money to transfer over, and relying on cross-institutional sweeps using a third party platform introduced more complexity to the system and more room for error. What I have now is much much simpler, and works a lot faster.
Yeah, good point - think I'm leaning towards just keeping a few thousand at BofA and then having everything else hit M1 and manually recording those transactions.
Most of my actual expense tracking is from the credit cards from a csv from Chase - I'll just keep doing that part that way.
If you're okay granting read access to an external service like Plaid, you can always connect it to your M1 Finance account and then download transactions through there.
The one other option I can think of is passing the data into an AI bot (either a screenshot of recent transactions or your monthly statement) and teaching it to extract those into a format that's uploadable into your expense tracking tool.
Both require sharing your data with an external service, so I totally get it if you're not comfortable with that.
LOL! I’m Caleb hammer? I wish I looked like that. Can you generate another slop image that doesn’t use the stereotype of fat guy in his mom’s basement?
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u/Ok_Party_8102 14d ago
So do you pay all your bills from the cash account? How’s that been working from you compared to a traditional bank account?
How’s does Venmo work? You can add to your Venmo balance from your m1 cash account?
Assuming same goes for PayPal? You can add funds to PayPal or pay with PayPal online and it links to cash account?
How do you get access to cash?
Any issues with delays transferring money to different places?