Squaremouth’s 2025 travel predictions reveal soaring costs and shifting destination trends, highlighting key challenges and preferences in a transforming industry.
In a year marked by challenges for the travel and hospitality sector, Squaremouth has unveiled its travel trend projections for 2025. These insights are derived from analyzing travel insurance policy sales for trips scheduled from January 1 to December 31, 2025.
One major insight highlights the ongoing escalation of travel expenses. Over the last four years, international travel costs have risen by 32%, with the average international trip expected to reach $9,922 in 2025 — an 11% increase from 2024. This significant rise may impact affordability for many travelers.
Due to these escalating costs, overall travel interest is anticipated to decline. However, there’s a noticeable change in popular destinations among those who continue to travel. European hotspots, especially the UK and Italy, are gaining traction, with interest in UK trips climbing by 16% and Italy by 11%.
Travel trends within North America are also shifting. There is a decline in trips to Mexico, while interest in Canadian destinations is growing, likely due to safety concerns. Canada has recently been recognized as one of the safest global destinations, making it a more attractive option.
Another prominent trend for 2025 is the increased travel among older age groups despite the rising costs. Squaremouth’s data reveals that over 80% of travelers next year will be aged 45 and older, marking an 11% rise from 2024. This contrasts with younger generations, who are expected to travel less frequently, likely because older adults may have greater disposable income to manage the increased expenses.
Here is a breakdown by generation:
| Generation | % of Travelers 2025 | 2024 | % Change YOY |
|---|---|---|---|
| Silent | 6% | 5% | +17% |
| Boomers | 53% | 50% | +6% |
| Gen X | 21% | 20% | +5% |
| Millennials | 11% | 11% | 0% |
| Gen Alpha | 3% | 5% | -40% |
| Gen Z | 6% | 9% | -50% |
In sum, 2025’s travel scene will likely be shaped by elevated costs and evolving destination preferences. For hotels and travel providers, adapting to these trends will be essential to remain competitive in a rapidly changing landscape.
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