View more on these topics

DB transfer values end 2018 with heightened volatility

Pension transfer values experienced a turbulent end to last year according to the consultancy XPS Pensions Group.

During December 2018 the group’s transfer value index was the most volatile it has been since September 2017.

The index tracks the transfer value that would be provided by an example defined benefit pension scheme to a 64-year-old client entitled to £10,000 a year pension starting at age 65.

Although the index remained relatively stable throughout 2018, a change in gilt yields made the end of the year more bumpy.

Over December the difference between the maximum and minimum readings was £14,000, around 6 per cent.

The index increased 2.3 per cent over the month but ended the year at £235,000, little changed from the figure of £236,000 at the end of 2017.

These figures were also relatively unchanged compared to the index at the end of 2016, which was £234,000.

The difference between maximum and minimum readings of the index over 2018 was £17,000, around 7 per cent.

XPS Pensions Group head of DB growth Sankar Mahalingham says: “Transfer values jumped sharply in early December before gradually falling again towards the end of the month.

“These movements were primarily driven by changes in gilt yields, which dropped by almost 0.5 per cent before recovering towards the end of the month.  Inflation was also volatile, but less so, and ended slightly down over the month.

“Despite being relatively stable over the course of the year, transfer values suffered a volatile December. This volatility may continue through the first quarter of 2019 as economic uncertainty around Brexit persists.”

Recommended

Invest-Performance-Portfolio-Fixed-Income-Graph-700x450.jpg

Pension transfer values drop in November

Pension transfer values fell by 2 per cent in November, according to consultancy XPS Pensions Group. At the end of October 2018 the group’s transfer value index was £235,000 and at the end of November it was £230,000. The index tracks the transfer value that would be provided by an example defined benefit pension scheme […]

Transfer values rising in Brexit run up

Consultancy XPS Pensions Group has said that an increase in transfer values during October is the highest monthly change in more than a year. The group’s transfer value index tracks what transfer value a benchmark defined benefit scheme would provide to a 64-year old member entitled to a £10,000 a year pension from 65, increasing […]

Volatility of transfer values could increase after Brexit, experts warn

Consultancy XPS Pensions Group has said that transfer values could become more volatile in the run up to Brexit, bucking a year-long period of stability. The group’s transfer value index, which tracks what transfer value a benchmark DB scheme would provide, stayed fairly even over the past two months, latest data shows. The index stood […]

What advisers need to know about sideways inheritance

Statistics and romance sometimes have a rocky relationship. In 2015, the last year for which full figures are available, there were 245,513 marriages in England and Wales. Sadly, there were also 101,077 divorces. Love, it would seem, can be complicated. The over-65s are getting even busier when it comes to tying – or untying – […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com