Defined benefit transfer values fell to a record low in mid-January, before recovering slightly at month-end, data from XPS Group has shown.
XPS Group’s Transfer Value Index dropped to a low of £142,000 mid-month, driven by increasing gilt yields towards the end of 2024 that continued into the start of 2025.
However, the firm said that since mid-January, gilt yields have started to fall again, resulting in the index climbing to a month-end position of £147,000, slightly higher than that of the previous month-end.
According to XPS Group, transfer volumes also remained relatively low. In January, XPS Group’s Transfer Activity Index recorded a marginal decrease to an annualised rate of 15 members in every 1,000 transferring their benefits to alternative arrangements, a similar rate to that seen for most of 2024.
Helen Cavanagh, senior consultant at XPS Group, said: “Whilst the Transfer Value Index at the end of January was relatively stable compared with the position at the end of December, the movement between these dates was volatile, with the Index reaching a new low in mid-January.
“Volatility of gilt yields over the past few months shows that it is critical that members have access to high quality support and advice to ensure they are well-informed when making decisions about their pension.”
Elsewhere, 88% of cases reviewed in January raised at least one scam warning flag, according to XPS Group’s Scam Flag Index. This marked an increase of 3% compared to the previous month, although overall, the index remained lower than 90% for the seventh month in a row.
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