Life Insurance Policies

Lee Spitzer's Avatar

Lee Spitzer

22 Sep, 2023 02:39 PM

Is there a way to record/track life insurance policies in Moneydance?

  1. 1 Posted by -Kevin N. on 22 Sep, 2023 03:09 PM

    -Kevin N.'s Avatar

    Hi Lee,

    I simply use Asset accounts to track Life Insurance policies.

    I adjust the value of them annually per the insurance company's statements.

    Of course, the premiums, I track in checking.

    It's probably not the most accurate way to track them. I could be transferring the premium costs to the Asset account and tracking the monthly interest on the cash value of the policy but all of that is covered in the insurance company's annual statements, so I don't see a need to enter those values.

    -Kevin N. (not a member of Moneydance Support)

  2. 2 Posted by Lee Spitzer on 22 Sep, 2023 04:26 PM

    Lee Spitzer's Avatar

    Thanks, Kevin N., for your quick response.

  3. 3 Posted by netr@cer on 17 Nov, 2023 06:04 PM

    netr@cer's Avatar

    Just saw this thread, this is something I have not previously tried to track in any financial software but probably should, especially since I have a seperate spreadsheet tracking the performance of my family's policies.

    Thanks Kevin N. I have some followup questions.

    • It sounds like you are referencing a whole life policy?
    • Do you create a single asset account for all your policies or does each policy need its own account?
    • Have you figured out a way to report unrealized capital gains? My policy reports the cash value if I redeem early, but part of that is viewed as a taxable gain.
    • Presumably your initial policy value was the number you put into the Initial Value field of the account edit screen?
    • When you adjust the value, are you entering a transaction (i.e. DivReinvest | Policy 1 | $1,000) or are you simply editing the balance adjustment field in the account edit screen?
  4. 4 Posted by -Kevin N. on 17 Nov, 2023 10:40 PM

    -Kevin N.'s Avatar

    Hi netr@cer,

    The policies I own are Flexible Premium Life policies which are similar to whole life in that they have an accumulating cash value provided a sufficient premium is maintained to cover the cost of insurance.

    I created 4 separate asset accounts. One for each policy.

    I haven't needed to redeem but the insurance company (MetLife) reports the amount paid into the policy on their website so any cap gain can be easily calculated. If you are situated in the U.S., it is likely that your insurance company is required to provide a form 1099 in the event of a redemption.

    I entered $0.00 as the 'Initial Value'. Every year I enter an 'Increase' transaction so that the balance is equals to the accumulated cash value of the policy. I use an "Other Income: Life Insurance" category.

    Like I said in my earlier post, I track the cost of the premiums in Checking. The annual statements cover all the minutiae of the individual monthly transactions, so I don't see the need to reflect that in Moneydance.

    -Kevn N. (not a member of Moneydance Support)

  5. 5 Posted by netr@cer on 18 Nov, 2023 06:05 PM

    netr@cer's Avatar

    Hi Kevin,

    Thanks for that info. It sounds like you are only tracking the redemption value as opposed to the value of the entire policy?

    I think absent an enhanced account type (which admittedly would be a stretch ask), it would be tough to fully track insurance policies especially with how many types there are.

    I may just keep insurance out of it....

    Thanks again for your posts.

  6. 6 Posted by -Kevin N. on 18 Nov, 2023 11:05 PM

    -Kevin N.'s Avatar

    Hi netr@cer,

    It sounds like you are only tracking the redemption value as opposed to the value of the entire policy.

    That is correct. I think including the face value of the policy would just over-inflate my net worth.

    There's also the fact that I'm likely not going to be around to enjoy payout. : ]

    -Kevin N. (not a member of Moneydance Support)

  7. 7 Posted by dwg on 19 Nov, 2023 12:34 AM

    dwg's Avatar

    While the premiums are certainly an expense Life Insurance is not generally view as an asset as such, if you have one with a surrender value you may want to track that value but an asset account with simple adjustment entries would do that for you.

    Some programs have gone down the path of allowing you to maintain "lists" in them for record keeping, like home inventory for instance and such lists could allow you to record things like life policies with the policy number ,face value etc, equipment serial numbers etc.

    Moneydance has not gone down this path.

    I do understand the desire though to keep all details in one place, You can achieve this fairly easily as long as you do not also want it to be one program.

    The way the Moneydance backup works it to really zip a folder tree, there is nothing stopping you putting more folders in the tree and using spreadsheets, documents etc to record the extra data you want to keep as part of your "financial" records, note that these extra folders will NOT be including in syncing, but will become part of the Moneydance backup.

    There are plenty of free and paid for programs to maintain documents and spreadsheets.

    You can have short cuts on your desktop that opens these folder for convenience.

    I doubt if we will see Moneydance becoming a program that keeps all and every piece of information that has some sort of financial implication, so I expect it will be necessary to use a number of tools to give a complete solution.

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