December was the fourth month in a row where pension transfer values monitored by XPS fell, although the number of people making a transfer rose.  

The XPS Transfer Value Index fell from £241,700 at the end of November to £238,800 at the end of December 2019, with the movement being mostly driven by increases in gilt yields.

The index peaked in 2019 at just over £260,000 in September. The index ended the year 9% below its peak of £260,400. 

The index started the year on 1 January at £235,200 and ended at £238,800 on 31 December, meaning transfer values effectively finished 2019 where they started.

XPS’s Transfer Activity Index showed an increase in the number of transfers completed in December, to an annual equivalent of 0.91% of eligible members, up from 0.81% in November. It means that over the course of 2019, just under 1% of eligible members transferred out of pension schemes administered by XPS.

XPS Transfer Watch monitors how market developments have affected transfer values for an example member as well as how many members are choosing to take a transfer. The index is based on the estimated Cash Transfer Value of a 64 year old member with a pension of £10,000 a year with typical inflation increases. 

Mark Barlow, partner at XPS Pensions Group said: “2019 was a turbulent year for transfer values, although November and December were two of the most stable months of the year. Surprisingly, the General Election did not have a significant impact on transfer values, perhaps as the market had already anticipated the result.”

He added: “2019 has seen a good amount of progress to improve outcomes for those members choosing to transfer out of their DB scheme. The Pensions Transfer Gold Standard was a great first step and it is encouraging to see so many advisers now adhering to its principles.”