Baby Boomers To Lead U.S. Outbound Travel Spend Growth

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U.S. outbound travel spend will increase 33% to $134 billion in 2025, according to a recent Visa study, with Americans 65 and older driving that growth.

“When it comes to leisure travel, Baby Boomers take more trips, longer trips and tend to spend more on their trips,” said Visa International economist Richard Lung, describing the findings from the study, “Mapping the Future of Global Travel and Tourism.”

International travelers 65 and older represent 14% of the U.S. outbound market by number of trips, Visa estimated, and their annual number of trips will increase at a compounded annual rate of 8.5% through 2025.

Consumers ages 35-64 currently represent the largest group of outbound U.S. travelers, at 61%. But this group will see its compounded annual growth in number of trips increase 3.8% over the next 10 years. Lung said part of that slower growth is due to the fact that there are fewer Americans in that age segment.

Travelers ages 0-34 represented the second-largest group of international travelers, at 25%. Their trips will increase approximately 3% over the next 10 years.

Today, U.S. outbound travel sales stand at $101 billion, Visa said, with the average household spending $4,433.

Visa also segmented travel spend by household income. Households with more than $150,000 in income will experience 4.6% compounded annual growth in international travel spend through 2025. These households represented 37.5% of outbound travel spend in 2015.

Visa said the key drivers impacting global travel over the next decade include a growing global middle class, greater Internet connectivity, improved transportation infrastructure across many countries, and an aging population with more time for leisure travel.

Visa conducted the study in conjunction with Oxford Economics using a combination of data from Visa-branded credit card cardholders, and survey data on the age and income of international travelers from a sample of 10 countries in 2004 and 2014. They did not disclose the size of the survey sample.