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For the first time in history, people aged 65+ outnumber children under five. And unlike those before them, this generation are reaching retirement with both longer life expectancies and more wealth. They're not pinching pennies, they’re making the most of life. In New Zealand, 71% of seniors say they're all good with spending their children's inheritance.
Today’s retirees have two things their parents didn’t have: time and money.
So what are they doing with this combo?
They're travelling. 🛳️
They're spending on healthcare. 🩺
They're funding the grandkids' school trips. 🚌
And they're looking for ways to make their money last. 💰
For investors, that's the interesting part. One demographic trend is creating demand across multiple industries.
This generation survived recessions, market crashes, and dial-up internet to finally reach retirement. Sure, they benefited from cheaper housing and friendlier interest rates, but after decades of doing the mahi, they’re ready for the treats. And this isn't a niche market. Americans aged 50+ spend so much that if they were their own country, they’d be the third largest economy in the world. 🌎
Retirement and unlimited buffets – a powerful combo 💪
The cruise industry is on track for its fourth consecutive year of growth, with around 65% of passengers now aged over 55. Operators like Royal Caribbean (RCL), and Carnival (CCL), hotel companies like Marriott (MAR), and booking platforms such as Booking Holdings (BKNG) are all ideally positioned to cater for the traveller who wants to take pics of Santorini on their iPads.
Living longer sounds great until you throw your back out walking in wet Crocs. As we age, demand rises for healthcare services, diagnostics, treatments, and medical devices. Companies such as UnitedHealth (UNH), and Humana (HUM), focus heavily on older demographics, while Abbott Laboratories (ABT) and Medtronic (MDT) develop everything from medical devices to medicines designed to extend the life of those body parts.
Retirement isn't one-size-fits-all 👚
Many retirees are looking to pass down their commemorative spoon collections and move into smaller homes, or into communities designed around healthcare and social connection. Welltower (WELL), one of the largest owners of senior housing and healthcare real estate in the US, has built an entire business around those changing needs.
After all those decades of saving and building their 401ks (like our KiwiSaver) retirees need advice on protecting their wealth, generating income and planning for what comes next. Financial companies such as Charles Schwab (SCHW), BlackRock (BLK) and T. Rowe Price (TROW) all have a retirement-focused part of the business that helps clients' money to last as long as they do.
Somewhere right now, a retiree is booking a cruise, upgrading their hearing aids, reviewing their insurance, or shopping for a retirement home. An ageing population isn't just a social shift. For investors, its multiple industries benefiting from the same demographic trend.
Read more: Financial Independence, Retire Never?
We’re not financial advisors and Hatch news is for your information only. However dazzling our writing, none of it is a recommendation to invest in any of the companies or funds mentioned. If you want support before making any investment decisions, consider seeking financial advice from a licensed provider. We’ve done our best to ensure all information is current when we pushed ‘publish’ on this article. And of course, with investing, your money isn’t guaranteed to grow and there’s always a risk you might lose money.
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