The World is Getting Older: A Growing Market for Investment Opportunities
The global population is expected to rise by 20% through 2050, but the number of people over the age of 65 is expected to double, to 1.6 billion from 800 million, over the same time. This demographic change presents significant investment opportunities, according to Goldman Sachs.
As people age, their spending habits change, with implications for growth and investment opportunities. In developed markets, older individuals dedicate a higher percentage of total spending to healthcare and housing, while spending less on transportation and insurance/pensions.
Goldman sees tailwinds in three areas: healthcare, senior living and care, and entertainment and experiences. In healthcare, spending rises as people age and deal with more medical issues. In 2021, those over 65 in the United States accounted for 36% of healthcare spending, despite making up 18% of the population.
Goldman has identified several healthcare stocks that can benefit from this trend, including:
* Health-care stocks rated a buy at the investment bank
In senior living and care, people will look for ways to either stay in their home as long as possible or move into senior housing, leading to more demand for home care and rehabilitation services, as well as assisted living, nursing facilities, and long-term care facilities. Goldman has a buy rating on BrightSpring Health Services, which provides community and home-health services, as well as infusion services, specialty pharmacy, and rehabilitation care.
In entertainment and experiences, older generations like to spend their money and time differently than their younger counterparts. Leisure activities, such as recreational vehicles, cruises, and motorcycle riding, are more common among those near retirement age or older. Goldman has buy ratings on Norwegian Cruise Line, Carnival, and Royal Caribbean Cruises, as well as pet e-commerce company Chewy.
Overall, the growing older population presents significant investment opportunities in healthcare, senior living and care, and entertainment and experiences.
