Watson Wyatt predicts the at retirement market in the UK will more than double within five years to over £30bn a year.
The consultancy group says the at retirement market was worth £13.6bn in 2007 and it predicts the market will grow by nearly 20 per cent a year over the next five years.
At retirement financial products include conventional annuities, income drawdown and variable annuities.
Watson Wyatt’s projections come from a study sponsored by nine providers which are active in the retirement planning and at retirement markets.
The firm’s calculations are based in part on data from the FSA for current market sizing and the ABI for new business trends.
It combined this with data on age, sex and accumulated fund distribution from the nine sponsors plus its own information on occupational defined contribution pensions.
Watson Wyatt senior consultant Mark Joannes says: “The rapid growth in this market provides considerable opportunities for product providers and financial advisers alike.
“The phenomenal growth we can expect in the at retirement market in the next few years is in part a consequence of the personal pensions sales boom back in the late 1980s and early 1990s.
“A lot of those people who took out personal pensions back then are now coming up to retirement age. With the prospect of a long-retirement ahead of them, many will be looking for ways to maximise retirement income while minimising capital erosion.”