Future of travel is luxury driven

I'd like to see the trend in demographics of travelers and how that is driving the changes. It seems to me that as the generation with disposable income AND an interest in foreign travel ages, things naturally skew towards comfort and luxury, and that means upgrades. Sooner or later a downswing occurs and budget travel becomes a thing again. If the current situation continues, with younger US generations being unable to afford housing or health insurance, leisure travel becomes a lower priority.

Agree that this is a being influenced by the demographics of retiree wealth. What will be interesting to watch is will we start to see fees, such as the now expired Venice Tourist Tax appear? I realize that most cities are not islands with limited access. But would museums, castles and cathedrals be willing to sell premium, limited access and restrict who can enter during those hours? I have been to a number of after-hours dinners at museums for corporate and charity events. What if ultra-luxury travelers wanted a whole morning to themselves?

Milennials et al will not be inheriting as much wealth from their parents as has been predicted.

I suspect the demand for lux travel is partly due to Baby Boomers who have more disposable income now than any other generation. There ‘s been a huge increase in the number of millionaires who are now retired and can afford luxury travel.

In 2000, there were between five and six million Americans who were millionaires. Today, there are 52 million of them!

Of course, $1 million doesn’t go as far as it used to.

During the same 26-year period from 2000 to 2026, the number of U.S. households with a net worth of more than $5 million exploded from 600,000 to about 6 million households. These are the households which have enough net worth to be in the top 1% of all Americans. They are richer than 99% of all Americans. Their numbers have increased tenfold as the concentration of wealth in America has accelerated. There also are impressive numbers of well-heeled folks from countries who historically were tied down by their governments and not as free to travel. Now they can travel and they are.

There are lots of Americans who invested for their retirement and the booming equities and real estate markets have created so much wealth for many of these retirees that they will run out of time before they run out of money. And those who can’t spend it fast enough will find ways to upgrade their travel style.

If only people like me would learn our station in life, curb our aspirations and let the deserving enjoy the fruits of their investments. What a wonderful world it would be if airplanes were just 1st class, hotels five-star, restaurants Michelin-rated, and a visit to the Sistine Chapple was by the Pope's personal invitation.

It's encouraging to hear that the cruise lines are starting to address solo travellers, and hopefully the fares will be reasonable. However I'm not sure if that will prompt me to take a cruise, as I don't think I'd enjoy the experience. I should add that I did take a cruise to Mexico many years ago and really enjoyed it, but at this stage of my life my travel style and preferences have changed.

This is such a fascinating thread. So many people are doing so well for the first time in history. It’s even pointed out a few posts above that the number of people in the Top 1% has exploded .. What???? LOL.

And a lot of the comments above hold true for those in the US economy, but possibly not so much for the European economy and that’s a good thing for me as it keeps the discount airlines in business. Thanks to that and my interest in Eastern Europe I travel more not and for less than I did 25 years ago. My goats appreciate that.

Traveling well on a shoestring budget has always been a challenge but doable given the proper research and the right attitude. Helping people enrich their travel experience without impoverishing thenselves is how Rick earned his iconic status (and ironically could himself today afford the highest luxury travel if he were to so choose).

Rick's recent videos have been far far away from "backdoor travel". His piece on barge travel was a good example. The trip he took on a barge was ticketed at $11,000 or thereabouts. This is not the hippie trail any more.

I was talking to this guy who said he was a Time Traveler from The Future and he told me the Future isn’t what they predicted it to be and “ultra-luxury class” class cruise ships had robots that even after they spilled watered down drinks on you that the robots still expected standard tips— 40%— or the robots left you, the traveler, a bad review on a forum like this if you dared to complain.

So, yeah, enjoy the way things are now!

Happy travels.

GPB Paul-of-the-Frozen-North

I guess an argument could be made that “budget” and “backdoor” are different things. But even with that his tours are not budget and they are not backdoor. They cater to the same client as everyone else that wants to maximize profit. But he repeated recently in an interview that the back of the plane is fine, all he needs on a flight is an aisle seat that reclines. I wondered who that guy in front of me was! But then he does reports for some pretty darn expensive hotels. Not criticism, I travel somewhat the same. Cheap flights in cramped seats but nice accommodations and easy and interesting transfers.

I love my goats and when they are gone, there are no more. So I try and use common sense in budgeting trips. Some things that are costly I get a lot of personal value out of and so I buy those. Some things I could care less about and I skip those. Fortunately I got Western Europe out of my system over 20 years ago, and I discovered Eastern Europe which has become a never ending adventure for me … and an affordable one at that.

I think if you look at trip to Europe in 1975 and compare the cost in 2025 dollars you might find that those high-end holidays today are about the same cost as a much more basic holiday back then. The equivelent cost might mean the same sort of folks traveling then and now, just getting more for their investment today.

People with investments are doing well, otherwise not so much.

As pointed out the big profit margins for things are at the high end of the scale: e.g. $100,000 cars and trucks and if you project your brokerage account balance over the remaining years available to utilize it you end up with "money to burn".

I am in the "retirement gamble" phase. A market downturn could severely limit by ability to draw on it because otherwise I could risk running out in the future, but then on the other hand maybe it will be OK?

What irks me is that the brokerage firms and hedge fund managers take our money and make profits off it either way, yet we're the ones playing roulette with our financial future. The reality is you have to play the game, because otherwise you are guaranteed to lose.

Ah back in the good old days— the 18th century — you’d go on the Grand Tour! Paris, Venice, Rome, Florence and maybe even see Mount Vesuvius in Naples! That was luxury travel. Strictly the ultra-wealthy. Because carrying cash was a recipe for highway robbery, letters of credit from London banks was the key lubricant for a grand time. No ATM exchange Euronet machines to avoid.

And this was a male affair or a chaperoned one for the ladies. But I gotta tell ya, it wasn’t all a bed of roses. You had to dodge disease, smelly toilets and long delays at the borders when customs agents inspected your prescription medications to make sure they only arrived in their original packaging. If not for the fact that slavery were still largely legal, a lot of this travel would have been ordeal. Thank goodness ultra-luxury travel is back in style! Maybe they’ll bring back serfs too! The buffets on cruise ships however weren’t always the most tasty. A lot of hardtack and rum.

Happy travels

Despite what the “travel industry” says, you can still fly economy over to whatever country you are looking to visit and do whatever your budget allows.

Again the profit is at the high end, it makes sense that the industry is targeting the people with money to burn and extracting all the money that they can with luxury upgrades, just like expensive cars and houses.

joefarnacle, you are so correct. My last trip to the US was about $800 RT. Here I still fly across Europe for 35€. No hidden costs, just costs i dont need. Tourists go to Croatia, i do a little of that too, but I think outside of national borders and balance Croatia costs with more affordable and more beautiful and more interesting neighboring countries.

I'd like to see the trend in demographics of travelers and how that is
driving the changes.

https://www.glion.edu/magazine/what-drives-luxury-travel-the-psychology/

I found another article that states that 35% of luxury travellers are Gen Z. Social media is one of the influences to spend more. But that's nothing new. In the article I posted, to be seen and seen as wealthy has always be an influencer.

"Luxury travel has a long and rich history, initially re­served for the aristocracy and nobility who took voyages to flaunt their powe­r and wealth."

The airlines have made the basic economy experience so uncomfortable that it's increased demand for business or first.

We have done 21 Ocean cruises and 7 river cruises. Our last Ocean cruise was in 2022 in the Galápagos Islands.
I recently booked an 8 day Western Caribbean to see the ancient Mayan sites, but we are unlikely to do more ocean cruise since we have done almost all that are offered, included touching on all six not frozen continents.
In pricing cruises, there are the obvious luxury cruises that cost double or more what you can get from the main lines like Celebrity, Royal Caribbean or NCL. We never felt paying so much more was worth the cost.

We were cruisers mainly for the PORTS NOT what is on the ship.

We now mainly do Gate 1 Travel group tours that are great, for very reasonable costs.

Also, we never pay for more than 2nd class flights, but are sometimes upgraded to PLUS. We can handle a few hours in tourist class. Delta is our favorite and their companion airlines like KLM, Air France and Korean Air are wonderful.

The airlines have made the basic economy experience so uncomfortable
that it's increased demand for business or
first.

You skipped Standard Economy and Premium Economy?. Premium Economy is actually very comparable to 1975 Economy in comfort but with more ammenities and less expensive than 1975 Economy. That should be your benchmark.

Basic economy makes the airlines profit, but more importantly opens the skies to an income group who not many years ago could not afford to fly. We shouldn't be intimidated by that, or jealous of it, we should celebrate it.

"basic economy experience so uncomfortable...." I always fly Basic no matter what but the going over in Basic SFO to Paris in 2023 was so unpleasant, if not downright awful, maybe qualifying for the most awful long distant flight experience in my life It did occur to me there must be a way to avoid the situation next time.

Well, I see that 2023 awful flight as a fluke , ie, Chances are won't happen again and since then it has not. Flying Business in the summer means at least $5,000-6,000....an unnecessary expense. In Basic I can pay less than 2,000 , put up with the unpleasantness (it it does turn out that way) and arrive in 11 hours.

I don't see myself splurging any amount on cruise ships as it pertains to Europe. regardless of the travel industry. Basically a wasted expense, plus traveling shoulder season and the winter I don't do at all.

As for luxury traveling I do have in some degree the income, the salient question is do I want to dispose an amount in that way of traveling ?

In June of 2025 a long time friend of mine and his wife were taking the Viking cruise trip from Budapest to Amsterdam . I said I would rendezvous with them when the ship pulled into Vienna, one of its 2 ports serves cruise ships coming from Vienna. It all worked out quite easily. Seeing the Viking ship, some of its guests, etc., just turned me off. , ie not my way of traveling at all.

The guy I was talking to-- the traveler from the future-- told me one other thing of note. He said in the future there will be mainly two classes of travel: Luxury and Ultra-Luxury. He said the main difference is that the soylent green they served in ultra-luxury was made from a better class of people.

Here is my expectation: Rick Steves Tours will still be giving the best European tours with the best guides and the experience will be enriching. But sadly you'll still occasionally have a hotel with no elevator.

Happy travels!

Yes, if you want a hotel unequipped with an elevator , I know of one in Berlin, a 2 star , not too far from Savignyplatz. still within walking distance. I stayed there last in 2007, after that forget it. No AC and no elevator did not factor into my decision to ditch this place.

In 2000, there were between five and six million Americans who were millionaires. Today, there are 52 million of them!
Of course, $1 million doesn’t go as far as it used to.
During the same 26-year period from 2000 to 2026, the number of U.S. households with a net worth of more than $5 million exploded from 600,000 to about 6 million households.

I started thinking about this, and I put a lot of it down to folks having PENSIONS vs folks having INDIVIDUAL 401k/retirement IRAs. IOW, if you're a retired police officer or teacher or prison guard, you might be guaranteed $80k income (inflation adjusted at that) and health insurance for life, but that is exactly ZERO on your balance sheet of "wealth". On the other hand, $1.5M in an individual IRA will be kicking off similar (WAGging this a bit) amount of income, but they have a balance sheet of a "millionaire".

If owning a home is factored in, that alone can push folks past a million in assets. Adding that to a two earner household nearing retirement, and you're rapidly approaching that $5M mark.

Future of travel is luxury driven

To this, I think in the US and other wealthier nations, businesses have increasingly pivoted to not relying on volume to drive profit, but rather to keep volume normal (reasonable to maintain) and charge higher prices and see larger margins. The classic, "Don't work harder, work smarter" sort of thing (or the "sell loaded SUVs and not barebones econoboxes" idea). Making something "feel" or "seem" premium is often just polishing a product and keeping to a standard (clean, uncrowded, well maintained, etc). Heck, with something like air travel, it's often more of slowly making things worse, and then offering a return to the original "normal" so it feels premium & so some portion of customers will readily pay more for upgrades to get them back to the old baseline.

For myself, I see the progression from very cheap traveller to more price-insensitive traveller has closely matched my aging and my bank account. The more time is "valued" and the less financial worry I have, the more likely I am to take reasonable shortcuts to be more comfortable, to have less headaches, and to hit more of my "want to do" list. But the other nice bit of getting older is that I am also more savvy about things like travel and also can identify times when it is easy to save money (still love using mass transit) or an "upgrade" is just a waste of money for very little gain.

I'd be interested to see how a person my age - in say 1986, 1996, 2006, and 2016 - travels differently than I do in 2026. Were folks in 1986 really like the Griswolds in European Vacation? At the mercy of horrid flights, awful rental cars, dirty hotels, and nasty food? I have to assume no, but I only started going to Europe in 1996, so have nothing to compare it to for the 80s or earlier.

Tom R,
I started traveling overseas in the early 80s taking a job in Riyadh, Saudi Arabia.
The movie European Vacation was NOTHING like what I found in traveling in Europe in the 80s. We did encounter a few rude Parisians, but a French friend not from Paris told me that some Parisians were rude to him and he was French.
Outside of Paris, the French were great.

The main difference between travel in the 80s and today is that WAY more Americans travel overseas than they did back in the 80s.
Also, lots of Japanese and Chinese travel now.

Yes, the stereotype of the Griswolds in Europe in 1986., I went back in 1987, but solo to do another trip, this time just short of 6 weeks in July and August, peak season , in Germany , London, and Paris, at 37 stayed in 2 star hotels, plus a couple of hostels. This time I had a Visa/MCcredit card which I only used in certain type of restaurants.

“ The main difference between travel in the 80’s and today is that WAY more Americans travel overseas than they did back in the 80’s”

This comment two posts above by geovagriffith nailed it. It’s precisely why the luxury travel market is going to grow. The number of Americans traveling internationally has grown exponentially during the last 36 years.

In 1990, the number of Americans who had a valid passport was only about 5% to 6% of the population.
Today, the number of passport-packing Americans is about 50% of the population.

With the explosion of the number of international tourists affecting airline passenger volumes, the demand for hotel rooms, cruise ship berths, and admission tickets to attractions— has all skyrocketed. Many wealthier travelers who want the special services offered by the lux market will become customers in that niche of the marketplace.

The only thing I ever looked at was a comparison between 1975 flying with 2025 flying. The result was that Premium Economy is comparable in comfort and amenities to 1975 standard Economy. The biggest difference being that 2026 Premium Economy flights have modern entertainment systems, sometimes better food, and significantly lower ticket costs than 1975 standard Economy. So maybe, with flights, the idea of affluent luxury is not spending more, but getting more.

I noticed that a few of the responses above are centered on US travelers. We don’t even make up 5% of the travelers to Europe so I am not sure how much Americans are driving the change. Short and medium haul flights in Europe are 35 to 40% by discount airlines and the number is growing. That’s not luxury; but I suspect it’s mostly European travelers.

The only thing I ever looked at was a comparison between 1975 flying with 2025 flying.

Sort of like comparing a car from 1975 to a car/SUV from 2025! MASSIVE progress has been made in the creature comforts (and safety, efficiency, technology, and ...), so it does make sense that, in many ways, flying today - if you subtract out the often horrible airport (security, price gouging, crowding) experience - you get a far superior "product" and a very reasonable price. Of course, to an OECD citizen, $1,000 for a flight to Europe is fair, but to a person from a poor nation, that might be a year's wages.

And it is never a surprise when this site takes a North American perspective.

Times have changed indeed! When Mr Darcy traveled the post at speeds sometimes in excess of 10 mph, changing to new fresh horses every 10 miles or so and allowing him to go distances often in excess of 50 miles in a single day, few others could afford this ultra-luxury travel.

Happy travels

there are the obvious luxury cruises that cost double or more what you
can get from the main lines like Celebrity, Royal Caribbean or NCL. We
never felt paying so much more was worth the cost.

Luxury in any style of travel is where my wife and I clash. She likes fancy things and she likes being pampered, I on the other hand could stay at the Motel 6 for a week while wearing the same underwear without bother. No matter the mode of transportation and travel, we've never not had a good time, and one thing we do agree on is that experiences matter. That balloon ride over the Dordogne for 90 minutes for €410 was worth every penny, at the same time, following the same path up Vimy Ridge at no cost that my Mom's uncle (who I was named after) took during WW1 was priceless. Staying overnight at a 'haunted' castle in Scotland for $500*/night, once again was worth every penny, seeing my mother-in-law visit her grandparents grave in Brightlingsea-a place she'd never been and grandparents she'd never met was priceless.

In these cases, luxury was is in the eye of the beholder(s).

$1,000 for a flight to Europe is a fair, but to a person from a poor
nation, that might be a year's wages.

Exactly, and that's why its so good to see Basic Economy and Discount Airlines. The middle class Americans with the 4000sf home and 2.6 cars may find them disgusting but the family of 4 living in 700 unairconditoned square feet doesn't see it the same way.

In the past flying, in 1970s, '80s and 1990s , flying anything but Basic Economy was beyond my financial capacity., simply didn't have to financial reserves to be disposed of in that manner. No so anymore, it's easy for me to choose premium economy or even business class, which some friends have urged , especially, at this age, as to avoid the unpleasantness likely to be encountered in Basic Economy .

Why should I? "They " say , you've earned it. That factor I see as irrelevant. I get to Europe after a long flight of 11 hrs and maybe having had to put up with the unpleasantness that could be part and parcel of Basic Economy. Still, I'm there after paying the lowest price possible offered in BE.

unpleasantness that could be part and parcel of Basic Economy.

And what would that be?

The 'Unpleasantness' - It's the close proximity to your 🐐 Mr. E!🤣

Hmmmmmmm. Possibly.

We got upgraded once on Swiss air on an USA to Zurich flight. It was either first or business class, notable is that it had the lie-flat beds built into seats. We woke up the next morning fresh and ready to go, which was good because we had three or four trains to catch on the trip to Wengen.

So overall a very nice experience, but I wouldn’t drop $5000 (or more?) on it unless I was in the “money to burn can’t take it with you” phase of retirement.

I'll take that chance of having unpleasant experiences in Basic Economy.

Basic Economy in and of itself is not an absolute unpleasant experience every time, it one finds that to be so, too bad. I would rather chance it in BE than paying an additional 1, 2 , or 3 thousand more merely to have 11 hours of hours of extra comfort.

While I can count on a few hours of sleep anywhere from 3 hrs. minimum to 6, in BE, I know that I'll arrive without jetlag and ready to go to take the RER to Paris Nord or the train from FRA after its 4 stops to Frankfurt Hbf. by noon or earllier.

In the future, basic economy has been rebranded "ultra-luxury basic economy". As long as you get one of the seats inside of the plane, I hear it's not all that bad.

Happy travels!

Agreed, I’d rather spend the money on nice accommodations than luxury airfare.

I did read somewhere about airlines purposely trying to make certain aspects of travel even more unpleasant so that travelers will pay extra to avoid the friction. The examples given were chaotic boarding processes and the closely related “overhead bin space”.

Although some airlines are better than others the entire boarding process with people jockeying for position in line or crowding the gate is something I don’t enjoy, and I believe it is mostly driven by anxiety about finding space for carry on bags. If you are allowed a carry on bag then there should be space for it above the seat you bought.

I’m not inclined to pay extra to avoid a problem that the airline is responsible for creating.