As the world and the nation get older, investments in longevity hold opportunity

Much has been made of the fact that the world’s population is getting older — so much that it’s getting, well, old.

Yet this abstract fact is projected to lead to an astonishing, visible reality: By 2030, one person out of every six in the global population will be older than 65. And over the next four years, the 65-plus population in the U.S. will increase by 50%.

Advancing medical care and changing lifestyles are extending life spans and increasing individual vigor significantly in developed nations.

Economic challenges

Historically, an aging population has meant a lower gross domestic product (GDP) resulting from a lower percentage of people working.Yet, with people working longer as they age, some experts expect this impact to be less pronounced than previously expected.

The U.S. gets around the working-age population problem with high immigration — a steady influx of people of working age who come here to work.

Europe also buoys its working-age population with immigration, though to a lesser extent. China has extremely low immigration, and many of its citizens would probably like to leave, ideally to come to the U.S.

As demographers expect China to develop a critical shortage of working-age people — resulting from the government’s former one-child-per-family policy—they’re forecasting severe long-term economic problems by mid-century. (Currently, China’s economy is wracked by deflation amid an economic slowdown that’s not officially a recession, but Chinese government statistics are hardly reliable.)

On average, people are much younger in Africa and India, and this has resulted in greater working-age populations than in China, Europe and the U.S.

In India, this key difference generally bodes well for the nation’s future. And although its population is largely impoverished, India is the world’s largest democracy, and democracy is highly supportive of capitalism and a rising GDP. So extremely long investments there have potential.

Similarly, demographers expect the relatively young populations of African countries to foster economic growth, though investments there face more political risk because democracy on that continent can be fragile. Yet for younger investors who can manage political risk, Africa (one of what are known as “frontier” investment markets) has significant potential for long investment.

Despite substantial immigration, the aging populations and low birthrates of the U.S. and Europe— from baby booms following World War II — had prompted economists to forecast poor long-term economic outcomes for the coming decades.

Yet, as living longer is turning out to mean working longer, enabled by increased vigor, the economic impacts of aging populations may not turn out to be as negative as previously assumed.

It stands to reason that negative impacts would likely be greater in less developed countries, where more people earn a living doing manual labor, but robots may make a big difference by supplanting human labor.

Older than you may think

Baby boomers in the U.S. are likely to get much older than many younger people have come to expect from mass media reports that have done a poor job explaining statistics on life spans.

Media outlets typically cite a statistic known as life expectancy — currently in the U.S., about 80.2 years for women and about 74.8 years for men, according to the CDC. Yet these statistics are largely irrelevant for older Americans, as they reflect everyone ever born in a given time frame, including those who die prematurely.

Average longevity naturally extends as people age, avoiding premature death. So, the pertinent statistics for those in or approaching retirement are those that estimate how long the average person their age is likely to be around.

For Americans aged 65, this figure is 19.7 years for women and 17 years for men, bringing average life expectancy to 84.7 and 82, respectively, according to the Organization for Economic Co-operation and Development. What’s more, one actuarial study estimates a 50% chance that one partner in a male-female couple currently aged 65 will live to between 93 and 95.

Of course, individual expectations of life span vary according to one’s health. But generally, relying on life expectancy at birth has led to misguided financial planning from underestimations of how much money people will need for retirement. And based on this, people underestimate how much of their portfolios they should keep in stocks (as opposed to bonds), and for how long.

As so many people are getting old — and will get much older than widely presumed — investing in what’s known as the longevity economy holds significant long-term potential. The predominant themes center on senior housing, senior living facilities and, of course, health care.

Health care stocks in general have been beaten up the last couple years. Yet increasing longevity assures at least gradual growth, as does its long-term defensive advantage: During tough economic times, people with insurance, especially Medicare, will seek medical care. Thus, investing in health care — the linchpin of the longevity economy — is somewhat recession-proof. And the older people get, the longer they will seek care and, of course, the more of it they’ll need. Currently people 65 and older make up 17% of the U.S. population but account for 37% of the nation’s health care spending.

As picking stocks is a highly specific endeavor and even smart companies can fail to profitably tap rising demand in competitive markets, buying exchange-traded funds focused on this theme makes a lot of sense.

Ways to invest

Here are some aging-theme investments worth considering:

1. Global X Aging Population ETF (AGNG). This ETF tracks stocks in the Idxx Aging Population Thematic Index As this is a theme index, investors get exposure to companies regardless of sector or geography. Top holdings include pharma companies AbbVie, AstraZeneca, Johnson & Johnson and Eli Lilly and medical device manufacturers Medtronic and Stryker. This fund has the top (five-star) rating from Morningstar for three-year performance. As of late October, shares were up more than 12% for the year and by early December, up more than 20% after a strong autumn.
2. Vanguard Health Care ETF (VHT). This ETF tracks the MSCI U.S. Investable Market Index Healthcare 25/50. Holdings include many of the same companies as AGNG, but there’s a key difference: VHT is more or less equally weighted (rather than capitalization-weighted), meaning that it has pretty much the same allocations to each holding. After a negative year in 2024 and a weak first half of this year, has since come on strong, with 2025 gains of nearly 14% as of early December.
3. Real estate investment trusts (REITs) that own senior residential and healthcare properties. The stock market’s real estate sector has been generally suppressed for a couple years from sustained high interest rates. But senior housing is an exception, as reflected by the performance of Welltower Inc. (WELL), which owns more than 1,500 senior housing and wellness communities in the United States, the United Kingdom and Canada. This REIT is up as astonishing 62% this year.

Another such REIT is Ventas (VTR), which has 1,400 properties in North American and the United Kingdom, 850 of which are senior housing communities with support services. Ventas also owns outpatient medical buildings, research centers and health care facilities. The stock is up about 38% this year, and currently has “buy” ratings from CFRA and Argus.

As the world gets older, investing in aging won’t—for at least a decade or two. Generally, the baby boom generation comprises those born between 1946 (now 79) and 1964 (now 61). In the U.S. that’s now more than 76 million people, most of them on Medicare and consuming products and services aimed at them—longer.

Dave Sheaff Gilreath, CFP,^® is a Partner Advisor at Sheaff Brock Investment Advisors, powered by Allworth Financial LP, an investment advisory firm registered with the SEC. Investments mentioned in this article may be held by Allworth Financial, affiliates or related persons.