Transfer Activity index hits lowest level since Index began for second time this year
Transfer Activity index hits lowest level since Index began for second time this year
30 Sep 2024
XPS Group’s Transfer Activity Index fell to its record low over August 2024 and matching 2018 levels, with an annualised rate of 14 members in every 1,000 transferring their benefits to alternative arrangements. Except for a brief increase in July 2024, transfer volumes have consistently remained at lower levels throughout most of 2024.
88% of cases reviewed by the XPS Scam Protection Service in August raised at least one scam warning flag, according to XPS’s Scam Flag Index. This represents a slight decrease from the previous month and is in line with the average level of the index over 2024.
XPS’s Transfer Value Index decreased marginally to £157,000 at the end of August. Throughout 2024 this Index has remained stable, hovering around the same value for eight consecutive months.
Helen Cavanagh, Senior Consultant, XPS Group, said: "We have now witnessed significantly lower volatility in transfer values for over a year, with values over 2024 being particularly stable. However, Transfer Activity has returned to its lowest point since 2018, suggesting that this stable environment may not influence transfer volumes as much as the size of the transfer value itself.”
Chart 1 - XPS Transfer Value Index
Chart 2 - XPS Transfer Activity Index
Chart 3 – XPS Scam Flag Index
Table 1 – Transfer Watch over the past 12 months
Source: XPS Group – All data is at the end of each month.
Notes:
XPS Transfer Watch is part of XPSArena, a free to access destination for learning support and development for people in pensions. Users will be able to scrutinise the latest data contributing to the headline Scam Flag Index, with filters available to compare warning flag prevalence over time and by several demographic groupings.
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 value.
XPS Group’s Transfer Value Index shows the estimated Cash Transfer Value of a 64-year-old member with a pension of £10,000 a year with typical inflation increases. The value changes over time with market movements. Mortality assumptions are reviewed periodically.
XPS Group’s Transfer Activity Index represent the annualised proportion of members that transfer out of pension schemes administered by XPS. If replicated across all private sector, funded, UK, DB schemes this indicates that approximately 10,000 DB members leave their schemes each year
XPS Group’s Scam Flag Index tracks the percentage of monthly transfers reviewed by the businesses’ scam protection service that are identified as having warning ‘flags’ which indicate that the member is at risk of being scammed. The flags monitored include both the DWP’s set list of amber and red warnings and further areas of concern identified and monitored by XPS’ Scam Protection Service. The service is provided to the Trustees of approximately 500 occupational pension schemes.