Research by intermediary database provider Equifax Touchstone found that new inflows for the final quarter of the year were also up 10.6% on Q3 to £4.6 billion.

Single premium flexible drawdown inflows jumped 87% in the year to £1.6 billion, a value increase of £0.7 billion on 2015, supporting evidence of a continuing trend towards drawdown.

The data from Equifax Touchstone, which covers more than 90% of the UK’s main life and pensions companies, shows that including transfers, total pension investments for the year reached £33.7 billion, up by 18.6% on the previous year (2015: £28.4 billion). 

Transfers across all pension products were also up by 18.7% to £16.1 billion, reflecting a continued demand for investors to adjust their retirement arrangements and access the right product wrapper for their needs, says Equifax.

SIPP inflows increased in 2016 by 16.2% (£2.3 billion). Total SIPP sales for the year stood at £16.8 billion compared to £14.4 billion in 2015.

Source: Equifax Touchstone

John Driscoll, director at Equifax Touchstone, said: “It’s promising to see 2016 end on a high after weak Q3 figures when inflows fell on market uncertainty from events including Brexit. Strong stock market performance towards the end of the year prompted a recovery in investor sentiment, a trend which has continued into the New Year, indicating continued growth in pension investments in the months ahead.

“For 2017, transfers will be an interesting area to watch; growing concerns around financing retirement will continue to drive people towards final salary transfers. Investor jitters around the security of final salary schemes following high-profile issues will also contribute to a continued rise in transfer volumes as more ‘insistent’ clients consider final salary transfers to access their savings.”

Equifax Touchstone uses intermediary and customer profiling tools to enable financial services providers to understand their marketplace and client base.