Pension Transfer Values Nearing Record Levels

Pension transfer values are climbing to almost record levels as returns from gilts dropped and inflation fell below expected levels.

Average transfer values started May at £242,300, and after rising through the month dropped to end at £241,500.

The number of direct benefit pension transfers also increased slightly, according to market monitor XPS Pensions Group.

Mark Barlow, senior consultant, XPS Pensions Group said: “Transfer values continue to run near record highs and, with the current political uncertainty, it doesn’t seem likely that they’ll fall significantly soon.

Call for better advice

“There’s been a slight increase in members transferring during May. The index seems to be settling at a figure of around 1% of eligible members transferring each year but we will see whether the current high transfer values result in more members taking a transfer in the coming months.

“We are really pleased that the Industry appears to be embracing the recently-launched Pension Transfer Gold Standard. High quality advice is crucial to ensure that members make the right decision and aren’t tempted by such high values. Particularly as we are in pension scams awareness fortnight, any steps to improve the overall quality and transparency of advice has to be a good thing.”

Direct benefit pension transfers: May 2016 – May 2019

Direct benefit pension transfers- May 2016 - May 2019

Source: XPS Pensions Group

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