Older Australians, like their counterparts in most developed markets, are travelling more often, staying longer and spending more when they arrive. It’s one of the more visible investment themes in the world today.
The demographic shift isn’t in dispute, but turning it into superior investment returns is proving harder than the story suggests.
It seems so obvious. A large, wealthy generation retires with an excess of time, health and savings, and spends a meaningful part of all of it on flights and cruises. The data supports it at almost every level.
If only accessing this theme profitably at a portfolio level were so easy…
Overall, the travel industry is booming.
The World Travel and Tourism Council expects travel and tourism to contribute US$12 trillion to the global economy in 2026, equal to 9.9% of global GDP and supporting 376 million jobs, or one in nine worldwide.
Source: Mr Rayess
The outlook is similarly bright. The global travel sector is forecast to grow 3.2% this year against 2.4% for the wider economy, and 3.6% p.a. over the next decade, roughly 1.5 times the pace of global growth.
The Australian experience is similar.
1,092,380 Australian travellers returned from short-term overseas trips in April 2026, 19.2% above the same month in 2019, with Indonesia and New Zealand the most popular destinations.
Source: ABS
Older Australians are disproportionately represented. The Baby Boomer Traveller 2026 Trend Report found that Australians aged 60 to 80 plan 1.3 international trips each year, close to double the national average.
The money behind this theme is unusually durable.
Superannuation now pays out more than $140 billion a year to Australian households. That’s income which is largely insensitive to the interest rate cycle. Hence, this cohort’s spending is holding up through a tightening cycle that’s squeezing younger mortgage holders.
There’s good news for the younger generations though. The Productivity Commission estimates $3.5 trillion will pass to them via inheritances over the coming couple of decades, a figure JB Were has since revised to $5.4 trillion. So, the freedoms enjoyed by the boomers will soon be shared with their children.
You’d expect a macro theme this entrenched to show up in earnings upgrades across the global travel and tourism sector.
If only.
The reality is more challenging.
Flight Centre cut its FY26 underlying profit before tax guidance in June, citing disruption from conflict in the Middle East, changed airline schedules, cancellations and currency movements.
Having said that, global operators have fared better.
Royal Caribbean lifted its earnings guidance thanks to record guest numbers and load factors, while strong 2027 bookings suggest the growth is set to continue.
The lesson is that a structural tailwind can be real and still fail to reach the most obvious beneficiaries, which are exposed to route disruption, fuel, currency and thin margins in a way travellers aren’t.
In short, where you own a theme matters as much as whether the theme exists.
Search and compare a purposely broad range of investments and connect directly with product issuers.
Three noteworthy angles complicate a neat version of a boomer travel boom as an investment theme:
Royal Caribbean chief executive Jason Liberty told investors in July that millennials and younger guests now make up half of the company’s passengers, with strong growth in three- and four-night trips.
Australian survey data through the first seven months of 2026 concurred, with younger travellers lifting trip frequency by more than 30% year on year while older travellers maintained steady, longer trips.
Boomers remain the highest spenders per trip, particularly on accommodation and in-destination experiences, while younger travellers deliver the higher volumes the travel industry depends upon.
In other words, a tourism-exposed business optimised for one may not be optimised for the other.
From 2027 the oldest boomers will reach their statistical life expectancy.
That means thriving boomer travel is a decade-scale opportunity, rather a permanent feature of the global economy.
Themes with an expiry date should be sized accordingly.
The most direct investment route to this theme is via the operators themselves: the airlines, cruise lines and travel agencies. This offers the highest leverage to rising tourism revenues, the highest sensitivity to oil, geopolitics and consumer confidence, and also the highest risk profile.
The second route is via the tourism infrastructure sitting underneath the traffic. For example, The Stay Company Income Fund operates holiday and resort accommodation complexes in South-East Queensland.
The third pathway is to own travel and tourism as a fund component rather than a thematic bet; through global equity funds or ETFs where tourism exposure sits alongside many other exposures.
For most investors, this diversified approach deserves consideration given Morningstar ‘Mind the Gap’ research found that investors capture the lowest portion of fund returns in narrow, high-conviction thematic funds.
There’s also a domestic implication here that many Australian investors overlook.
Inbound tourism is now worth about $213 billion and has grown at close to 10% p.a. since 2021, with 8.4 million international visitors in FY2024-25 and record Chinese visitor spending of $12.3 billion for the year to September 2025. It’s also noteworthy that Western Sydney International opens to passengers this October.
The upshot is that the local economy is already a diversified play on tourism. Domestic funds and ETFs are thus exposed to some extent to this structural theme.
Fuel and geopolitics remain the main swing factors in the global travel sector, as this year has shown.
Currency cuts both ways, since a stronger Australian dollar makes overseas trips cheaper for Australians while making Australia dearer for inbound visitors.
Capacity constraints in aviation and hospitality can also cap peak-period upside.
More generally, travel is discretionary by definition, so it is among the first things households cut when confidence turns. It’s a sector worth being cautious about during prolonged economic downturns.
The boomer travel boom is a compelling investment theme that requires careful planning to access.
The most useful approach is to separate the demand story from the question of who captures the profit, which varies enormously by business model type.
If you want exposure, decide first whether you are buying operational leverage, infrastructure economics or diversified global fund or ETF exposure, then size your position for a theme with a demographic clock running on it.
The Fund presents an unrivalled investment opportunity with a primary focus on generating consistent income for investors. (For Wholesale Investors Only)
Disclaimer: This article is prepared by Simon Turner. It is for educational purposes only. While all reasonable care has been taken by the author in the preparation of this information, the author and InvestmentMarkets (Aust) Pty. Ltd. as publisher take no responsibility for any actions taken based on information contained herein or for any errors or omissions within it. Interested parties should seek independent professional advice prior to acting on any information presented. Please note past performance is not a reliable indicator of future performance.
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