Sample inputs and snapshot output
| Scenario | Years | Initial Premium | Monthly Premium | Crediting Rate | Monthly COI | Estimated Year 10 Cash Value |
|---|---|---|---|---|---|---|
| Baseline | 20 | $1,000 | $150 | 4.5% | $25 | Varies by fees and withdrawals |
| Higher premiums | 20 | $2,500 | $250 | 4.5% | $25 | Often higher due to larger contributions |
| Lower growth | 20 | $1,000 | $150 | 3.0% | $25 | Usually lower with reduced crediting |
These are illustrative examples, not guarantees. Real policies use detailed charge schedules.
Monthly crediting with premiums and charges
This calculator projects cash value month by month. Premiums are reduced by a premium load, then the model subtracts fees and insurance cost, credits interest, and applies withdrawals and loan activity at year-end.
NetPremium = Premium × (1 − Load%)
Balance(m) = ( Balance(m−1) + NetPremium − MonthlyFee − MonthlyCOI ) × (1 + MonthlyRate)
Loan balance accrues separately: Loan(m) = Loan(m−1) × (1 + LoanMonthlyRate), and net cash value is CashValue − LoanBalance.
Steps to run a realistic projection
- Enter the number of years you want to project.
- Add an initial premium if you plan a first deposit.
- Set the periodic premium amount and frequency you expect to pay.
- Adjust premium load, policy fee, and monthly insurance cost to reflect estimates.
- Choose a crediting rate that matches your policy type and assumptions.
- If you plan withdrawals or a loan, set start years and amounts.
- Press Calculate Cash Value to view the summary and yearly table.
- Use the CSV/PDF buttons to export your results after calculating.
Cash value drivers and assumptions
Cash value grows from net premiums and credited interest, then declines from charges. This model compounds monthly using an annual crediting rate converted to an effective monthly rate, so a 4.50% assumption becomes about 0.37% per month. Results are scenario-based, not guaranteed, and should be compared across multiple inputs for clearer planning decisions.
Premium timing and load effects
Premiums are credited at the selected frequency, and a premium load reduces each contribution before it reaches the cash value. For example, a $150 monthly premium with a 4% load credits $144. If you switch to quarterly funding, contributions arrive in larger steps, which can slightly change interest timing over the year. Higher loads reduce credited premiums and compounding.
Fees, cost of insurance, and sustainability
Policy fees and monthly cost of insurance are subtracted before interest is applied. A $60 annual fee averages $5 per month, and a $25 monthly insurance cost totals roughly $300 per year. When premiums are low and charges are high, the projection may show slow growth or plateaus, highlighting the importance of monitoring net contributions. Stress test by increasing COI by 10% to see sensitivity.
Withdrawals and loan tradeoffs
Withdrawals reduce the cash value directly at year end, while a policy loan creates a separate balance that accrues interest and reduces net cash value. If a $5,000 loan starts in year 6 at 6.5% and is not repaid, the loan balance can grow meaningfully over time. Annual repayments reduce the outstanding balance and improve net value. Consider adding repayments that match expected cash flow cycles.
Reading the projection outputs
The table reports yearly premiums paid, fees, interest earned, withdrawals, ending cash value, loan balance, net cash value, and an estimated surrender value using a charge percentage for a defined number of years. Use the chart to spot inflection points, then adjust assumptions to match policy illustrations, rider costs, and planned access needs. Export CSV to compare side by side in a spreadsheet.
Common questions about cash value projections
What does net cash value mean here?
Net cash value is ending cash value minus the outstanding loan balance. It represents what remains if loan interest continues and you do not repay immediately.
Why can cash value stop growing?
Growth can flatten when monthly fees and insurance costs consume most of the net premiums and interest. Lower crediting rates and higher charges magnify this effect, especially in later years.
How is the monthly interest rate calculated?
The calculator converts the annual crediting rate into an effective monthly rate using compound math: (1+annual)^(1/12)−1. This keeps the projection consistent with annual compounding assumptions.
Do withdrawals reduce interest earnings?
Yes. A withdrawal lowers the balance, so future interest is earned on a smaller amount. Frequent or large withdrawals can materially reduce long-term cash value and estimated surrender value.
How does a policy loan affect results?
A loan creates a separate balance that accrues interest at the loan rate. The projection shows the loan balance and reduces net cash value accordingly. Repayments at year end reduce the loan and improve net value.
Can I use this for any policy type?
Use it as a planning model for cash value policies such as whole life or universal life. Actual policy charges, caps, participation rates, and guarantees differ, so align inputs with your illustration before decisions.