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We’ve seen plenty of credit card launches, upgrades, revisions and rebranding in the past couple of years. It’s easy to get lost in all the breaking news with both well-known and lesser-known issuers—and wonder if all these new offers offer any unique value.
No matter how mundane or gimmicky these offers get, there aren’t many credit cards that make it easy for you to invest your cash back rewards into the stock market.
That’s where the Owner’s Rewards Card by M1 comes in.
Launched in the summer of 2021, cardholders can earn cash back with their Owner’s Rewards Card by M1 when shopping at select companies where they own the stock. In March of 2022, M1 added a number of fuel brands to help ease the strain of rising gas prices consumers have been facing.
With this card, the cash back you earn on eligible transactions is automatically invested into your stock portfolio. The idea is that you’ll use your everyday credit card spending to help support your long-term wealth-building goals.
The card is now available to all M1 users, so applicants are no longer required to join M1’s annual membership plan that offers benefits including additional trading windows and custodial accounts, among other items.
About M1 Finance
Although M1 Finance isn’t a major issuer in the credit card industry, it’s no stranger to making strides in fintech. So far, its suite of product offerings includes a self-directed investing platform with automation features, a personal line of credit collateralized by investors’ portfolios and even a checking account option. As of May 2021, M1 had over $4 billion in assets under management (AUM).
According to a company executive, M1 started as a free investment platform with aspirations to give investing clients a “single, integrated platform for all of their financial needs.” With this in mind, the Owner’s Rewards Card seems like a natural next step to provide new and existing users on the platform with even more value.
How does the Owner’s Rewards Card by M1 Work?
To get the card, you’ve got to have an eligible brokerage account with M1. When you’re approved, you can enjoy up to 10 percent cash back on participating brands.
Here’s an example of brands and the cash back you could earn (see the full list here):
10% cash back tier:
- Adobe (ADBE)
- AMC Theaters (AMC)
- Lululemon Athletica (LULU)
- Netflix (NFLX)
5% cash back tier:
- American Airlines (AAL)
- Chipotle Mexican Grill (CMG)
- Southwest Airlines (LUV)
- Nike (NKE)
- Amoco/BP (BP plc)
- Chevron/Texaco (CVX)
- Exxon/Mobile (XOM)
2.5% cash back tier:
- Home Depot (HD)
- Target (TGT)
- Walmart (WMT)
- KFC (YUM)
In order to get the cash back from these brands, you’ve got to own stock in the company (or the company that owns the brand). Then you can use your cash back as “microinvestments” back into your M1 brokerage account.
What else should I know about this card?
The card is part of the Visa Signature network, which includes benefits like zero liability, lost/stolen card reporting, Visa Signature Luxury Hotel Collection, Visa Signature Concierge, and integration with users’ M1 accounts. The physical card will be metal with contactless tap-to-pay and mobile payment options.
Who should get the Owner’s Rewards Card by M1?
Although the concept of investing credit card rewards isn’t entirely new, M1 does have a more convenient, automated approach to the process. It handles the movement of funds from your credit card cash back reserves into your investing account—based on the brands you own and spend with. If this appeals to you, you’d be a prime candidate for this card.
However, you should know that your returns are subject to market fluctuations once your cash back goes into your investment portfolio. That is, if you invest $100 of your cash back in the stock market, it could lose its value and even go down to $0. On the flip side, your money could grow as your investments increase in value. In the end, you’ll have to decide if this is a risk you are willing to take with your credit card rewards.