Less pampering, more experiences: Luxury travel for the next generation

Luxury travel used to mean shiny yachts, private jets and Michelin-starred restaurants. For the next generation, it could just easily be a hammock at an eco-lodge or teaching English in a developing country if it means access to a unique experience.

Of course, some travelers will always gravitate toward creature comforts while they're on the road. But as consumer tastes shift away from acquiring stuff to doing stuff, the notion of luxury travel is going through a transformation too. 

“Increasingly, the emerging wealth demographic is prioritizing international travel and exclusive life experiences,” notes Doug Levasseur, Financial Planning Specialist with BMO Wealth Management. “These experiences provide exposure to different cultures, help develop an informed perspective and make great social media fodder.”

A survey from RealtyMogul.com, an online marketplace for commercial real estate, found that Millennials would rather spend their money on traveling than buying a home. For many travelers, checking out of their hectic lives to immerse themselves in another world is the ultimate in luxury travel.

Doing, not pampering
In today's hard-charging world, travelers welcome the opportunity to unplug and connect with their authentic selves. And many feel that they must pack their bags and go somewhere to do that. To them, immersive experiences with big doses of history and culture, are key. 

Why hire a car and driver to whisk you all over, when you can hop in an Uber and strike up an interesting conversation with the driver, who just might be a doctoral student in local history and provide unique context.

A travel experience doesn't have to be over-the-top pampering for it to check the “luxury” box. Luxury travel provides the possibility to transform the traveler to a completely different world and enjoy an experience not easily replicated.

A hotel concierge may not be able to give you that kind of experience. Instead, you'll need to seek out tour operators who act like the friend who has been living abroad and can give you insider tips.

Tell the world about it
Young consumers believe in doing something meaningful that's high on social and environmental impact. It's no surprise that they seek to spend their money where they can make positive social and environmental impact. Travel is no different.  

And they want to take their friends and family along, at least digitally. Using tag lines like #Livelikealocal or #Touristnomore, young travelers share lush photos of what they're doing every step of the way, as well as posting travel anecdotes and meaningful encounters with locals. So they're choosing locales and experiences that make for Instagram-worthy images and content.

Social media is a two-way street. Luxury travelers are likely to crowdsource their itinerary ahead of time, so they know where to look for those unique experiences before they arrive.

Mini-retirements
Many people save and invest their entire working lives so they can enjoy years of travel when they retire. A growing number of people are starting to see flaws in that plan. First, there's no guarantee that your health will be good enough in your 60s and 70s to travel in the way you want. And when life is an endless vacation, many retirees experience boredom. Travel loses its potential to transform and pluck you out of your everyday life.

Instead, a growing number of people are taking retirement for a test run during what is supposed to be their working years, by incorporating long periods of travel.

“People are showing a reluctance to defer all retirement time to the sunset years of life,” Levasseur says. “Individuals are taking sabbaticals or mini-retirements that allow time for things like world travel, continuing education, career pivot and relaxation.”

Exploring new frontiers
Though it's not a reality yet, intrepid travelers will one day be able to travel far—very far. Space tourism is the ultimate in luxury travel because it's so exclusive, available to only a small fraction of the population who can afford that kind of experience.

Billionaire Richard Branson has been working for years on the Virgin Galactic SpaceShipTwo Unity (VSS). The idea is to transport a dozen or so travelers 68 miles into space. The first version of the SpaceShipTwo, the Enterprise, crashed during a test flight in 2014, which dampened some enthusiasm for space travel. More recent test flights have been successful, and some 700 adventurers have already put down deposits for the suborbital flights, which are expected to cost $250,000.

Meanwhile other companies have other ideas about how to bring tourists to space. One is Orion Span, which recently announced plans for the first luxury space hotel. The hotel will be able to house four guests and two crew members per stay. Guests will have to complete a three-month training program before setting off. 

After you’ve been bitten by the travel bug, travel is no longer a one-time expense. It’s a reflection of your values and an important element of your financial plan. Defining your travel goals early on can help you evaluate options and have the travel experiences you want without jeopardizing other goals.