High current through Mosfet in boost converter?
Did I chose a correct mosfet? I would like a mosfet in a really small package but I am not sure what to choose

Nowadays, an SO-8 is a pretty big package (with pretty poor heat sinking capability).
If you want a small package, look for a DFN package. These can be 3x3 or 4x4 mm, although you'll have to do a careful search to find exactly what's available fitting your requirements for voltage and current.

How do I lower the current through M1 so I am not wasting unnecessary amounts of power

The current through the MOSFET will be equal to the inductor current during the charging part of the cycle.
You can reduce the start up overshoot using a slow start circuit.
But you shouldn't worry that this wastes power. The power consumed by the MOSFET is equal to the current through its channel times the voltage across the channel. So if you pick a MOSFET with low \$R_{ds}(on)\$, and drive the gate sufficiently hard to put it fully in the on state (and to transition quickly between the on and off states), the power consumption can be kept quite low.
If you want to reduce the wasted power in this circuit and improve its efficiency, you should consider using a boost controller circuit able to drive a 2nd MOSFET as a &quot;synchronous rectifier&quot; in place of diode D1.
simulation note
If you zoom in on the MOSFET drain current waveform you will likely see something like this:

The current magnitude you in the zoomed out view comes from that initial peak each time the FET turns on, but the average current through the FET is much lower, in line with the load current as expected.
The turn on peaks  result from current through parasitic capacitance in the simulation model, and in the real world they will be dramatically reduced by interconnect inductance that isn't included in the model. You can also reduce them by including a resistor (say 5-20 ohms) between the switching voltage supply and the MOSFET gate.