Defined Benefit transfer activity on the rise as market fails to cool

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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.

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