DB transfer values nudge record highs

Transfer values touched record highs in April and fluctuated by more than 3.5 per cent across the month, meaning the value of a £10,000 a year income changed by £9,000, according to the Xafinity Transfer Value Index.

The index touched its previous record high, recorded in October 2016, of £244,000 – for its sample individual with a £10,000 a year transfer for a 64-year-old entitled to a pension at age 65 indexed to inflation – before falling to £237,000 at the end of April. This was an increase of just under 1 per cent over the course of the month. April’s volatility follows a relative period of calm for transfer values over the first quarter of the year.

Different schemes calculate transfer values in different ways, with some individuals receiving transfer offers of multiples of 50 of their annual future income.

Xafinity director Sankar Mahalingham says:  “Transfer values in April 2017 were more volatile than in recent months, with changes in inflation expectations being the main driver.  This is partly due to the triggering of Article 50 and the announcement of the general election. More fluctuation is likely over coming months. Transfer values remain high, and the trend for more members taking this option will no doubt continue.”