Defined Benefit transfer activity on the rise as market fails to cool
Following an increase in pension transfer activity, data from last month was suggesting that the market was beginning to cool.
Transfer Activity Index revealed a slight increase in transfer numbers processed by the administration business during May, compared against April’s data.
This slight increase in transfers processed infers a greater share of eligible members cashed out. Transfers in May stood at 0.94% while April stood at 0.87
Government bond yields also fell during May, leading to a boost in transfer values, yet May ended slightly down on their figure against April.
A sample member could have cashed out at £241,500, compared to £242,300 at the end of the previous month.
Transfer values are maintaining almost record highs, and, with the current political uncertainty, it is unlikely they will see a significant drop soon.
There has been a minor increase in the transfer numbers as of May this year. The index seems to be settling at a figure of around 1 percent 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.