This past week CEO Brian Chesky of Airbnb, the worldwide travel website for renting private homes said travel will “never, ever go back to the way it was pre-COVID.” Citing a change in public perception and concern of health he felt people would stay closer to home. To weigh in on that, Mike Reeves financial planning advisor of Strategic Wealth Designers joined the newscast to give his financial perspective on how that may affect several sectors of the economy. Reeves says the statement certainly grabs headlines but likely long term won’t change the industry forever.
“In the short term absolutely it will continue to halt travel plans, likely the rest of 2020 and some portion of 2021 there will be portion of the population that isn’t comfortable traveling,” Reeves said. “However, once the momentum gets moving in a positive direction, from either a vaccine or a herd immunity from the virus, people will be on the move again. Our international travel was at an all-time high prior to COVID hitting. In a world where it seems like there is little agreed upon, both young and old, liberal or conservative, both love to travel and get out and see the world.”
The European Union just released their approved list of countries that can come into Europe starting July 1st and the United States isn’t on the approved list while coronavirus cases spike to increasingly high levels stateside . Chesky noted in his statement that he felt people would be more akin to staying closer to home and driving vs getting on a plane to vacation. With the European Union ban on Americans traveling there, it may force many American’s hands on where they go for vacation. Reeves says from a financial standpoint for the country it could be a shot in the arm but it comes with some drawbacks as well.
“Buying American and spending American is a great thing. Our unemployment rate has been hit extremely hard by the pandemic and putting discretionary dollars back into the economy is good,” Reeves said. “A potential drawback is the mental health aspect for people. Whether it’s a big spring break with friends to Italy or a retiree who’s saved for their retirement years to travel the world, that is definitely a downside. We’ve had numerous clients and employees who have been forced to cancel international experiences because of the virus and that can be a big mental disappointment, that affects day to day productivity.”
From business travel to the amount of commercial office space needed with more and more employees successfully doing their jobs from home, the future will change with many things being eliminated but also many new opportunities created. Ultimately, Reeves says travel won’t just go back to what it once was, it will expand even further.
“ It won’t be overnight but worldwide travel will roar back with excitement, who knows, maybe the hyper-speed jets that transport you over oceans in just a few hours will be in place faster because of this, but no matter what Americans will be excited to travel again soon,” Reeves says.
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