Looking for Suggestions - alternatives to tracking SD-IRA accounts

rentable.speller353's Avatar

rentable.speller353

24 Apr, 2024 11:51 PM

The past five years or so, I've essentially been jerry-rigging my SD-IRA acounts as "Investments" within Moneydance but the way I have it set up doesn't work well: a) it doesn't track cost basis b) it doesn't track ROI c) the way the transactions work in the actual fund does not align with how I have it set up in Moneydance.

Long story short, the way I have it in Moneydance is the way I jerry-rigged it when I started using the product and the many times over the years I've researched how to do it a better way have left me only more confused. So, I've decided to throw my arms up and ask how others might be doing it since the accounts I'm tracking are certainly not an obscure type of account. As matter of fact, they are very typical investment accounts with no securities involved.

What I have are a few accounts that are Self-Directed IRA's with the following characteristics:
a) They have a cash custodian, separate from the investment vehicle. So, I need to track cash.
b) The investment vehicle is NOT a security, nor does it have any matching features like "shares", "price", "ticker", etc.
c) The investment vehicle is a rather standard: they are mortgage notes and I earn regular dividends.
d) There are fees with transactions that need tracked, as with any investment

I would like to be able to track the Cash / Investment / Cost Basis / ROI. Right now, I'm tracking account value by misusing "security" fields because I can't figure out any alternatives.

This seems like it would be very simple to set up, but the MD "Investment" accounts don't seem to offer any flexibility away from the shares/price/ticker security mentality. Or, maybe I'm really overlooking something obvious, which I hope that i am?

When I read the MD documentation for setting up "investments", it offers no assistance aside from suggestion I can use "sub types" but that doesn't solve any problems for me - it only raises many more questions since I'm still required to enter "securities" information for investments that don't work that way.

  1. 1 Posted by DrgnMastr on 25 Apr, 2024 12:28 AM

    DrgnMastr's Avatar

    We have something similar in Canada, called the Tax Free Savings Account or TFSA, as well as other self-directed investment accounts. Ignore the word Savings, as a TFSA can hold anything CRA (Can IRS) deems can be held in it. The big difference, though, it is limited to cash, stocks, bonds, mutual funds and ETFs, so it is easy to use as an MD investment account.

    MD Investment accounts have two entriy locations: Register and Bank Register. The Register is used for purchase and sale of 'goods', for example. It has a field for "Fee" which I use for the cost of associated with buying and selling things in my self-directed TFSA. The other register, Bank Register, works like the register in bank accounts, and records as an XFR on the other Register. I don't know if any of this helps you.

    I look forward to seeing the replies to your question, from those with more knowledge in this matter.

  2. 2 Posted by rentable.spelle... on 25 Apr, 2024 01:05 AM

    rentable.speller353's Avatar

    I think I've attempted going this route before, so I set up a quick test account to play with it again after you mentioned it. I enter an adjusted cash balance in Bank Register of $1000 to get the account started and then go over to "Register" to attempt to "Buy" $500 of Mortgage Notes, but it doesn't allow me to do anything in the Action column except "Xfr". So, I can't "Buy" or "BuyXFR" anything without creating a Security which allows me to then do proper Actions, but now I'm back into dealing with the Securities issues I've described. I must be overlooking something?

  3. 3 Posted by DrgnMastr on 25 Apr, 2024 01:26 AM

    DrgnMastr's Avatar

    The security doesn't have to be one where you look up quotes. In one of my accounts, I have some GICs (CDs in the US I believe).

  4. 4 Posted by rentable.spelle... on 25 Apr, 2024 01:39 AM

    rentable.speller353's Avatar

    Yup - I see now. I see it enters 1 in the price field when I use "Other" type.

    I'll need to play with this some more to see if the reporting is working the way I hope ( E.G. ROI, etc).

    Thanks so much for the guidance! You've helped me look at the account config a different way.

  5. 5 Posted by dwg on 25 Apr, 2024 02:12 AM

    dwg's Avatar

    It is easy to get hung up on thinking that Ticker, shares, price must mean shares or funds.

    Ticker is just a code that can be used to look up a price of any sort of security, if it is available, we can ignore it for anything other than shares and funds.

    "Shares" can be thought of how many of this things have I bought, price is easy what did each one cost.

    An investment account is just a container file that contains one or more individual investments, shame there is not two terms that can be used here. A brokerage account is just an example of this, shares purchased through that specific broker.

    A security is just the individual investment. It has to have a name and this is as good as anything

    So these concepts can be applied fairly generally.

    The trick is always how to set things up, and different ways will suit individuals, their circumstances, what data they can get, and what level they want/can manage the investment at. It can also be influenced by what reporting you want.

    No software will have everything, some programs mask things by the front end. Moneydance is more raw and you interact directly with the registers.

    Note what I said earlier about shares and prices. in some case a different approach works better and you fundamentally reverse the concept to a degree by saying the price is 1 and the number of shares equals the purchase value. This can work better for some investment types.

  6. 6 Posted by Stuart Beesley ... on 25 Apr, 2024 06:07 AM

    Stuart Beesley (Mr Toolbox)'s Avatar

    @rentable.speller353 as dwg says….. I do exactly what you want with Investment accounts.

    • create a new security called ‘Mortgage Notes’
    • create your investment account
    • actions add security, ‘Mortgage Notes’
    • Xfr +20000 to add £20000 (for example) cash into the account. In the transfer field, specify the bank account that will supply the cash, or use a misc category. Lots of us set up a junk category for various investment things and exclude that from all reports.
    • now buy x shares (units) of the Mortgage Notes. Question. Do you have x units or is it always 1? If it’s just a value (no units) then buy 1 for the value and you will see the price becomes the value. This becomes the cost basis.
    • in future to change the value, tools/securities/select/add a new price for the new unit value, or the new total value.
    • now monthly enter Div or DivXfr txns for dividends. Use a category of ‘interest’ or something like that.

    PS - some people track their house value like this too

  7. 7 Posted by rentable.spelle... on 25 Apr, 2024 12:10 PM

    rentable.speller353's Avatar

    Thanks for the idea! I will play with that suggestion. It sounds like it may be the way to get Moneydance to do what is needed.

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