Should You Use Your 401k for a Ticket to Space? Exploring Investing in Space Tourism, Ep. 319

Should You Cash Out Your 401k for a Ticket to Space? 

This week on The Capitalist Investor, we launch into the fast-growing space economy—from space tourism hype to real investment opportunities. Derek opens with a hilarious hypothetical: should you drain your 401k to buy a $450,000 Virgin Galactic flight? Spoiler: probably not—but the question sparks a deeper dive into space tech, exploration, and where savvy investors are looking. 

Dave and Derek explore: 

• Why space exploration matters: from national security to saving humanity
• Everyday tech that came from NASA (LASIK, memory foam, firefighting tools)
• Top space-focused ETFs like ARKX and companies like Intuitive Machines (LUNR)
• Why SpaceX is still out of reach—and how to prep for when it’s not
• Is space the next survival frontier... or just another billionaire’s playground?

Whether you’re into rockets, returns, or the reality behind space hype—this episode breaks it down with insight and humor.
 
🎧 Listen now and give your portfolio a little rocket fuel.

Transcript

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All right, Dave, this week we're going to talk about if it is a good idea to take all of the money inside of your 401k and buy a ticket to space. What do you think? That's a juicy one, Derek. Let's get into that one a little bit. Capitalist investor back again this week. Dave Abate. How you doing, buddy? Great to be back. D. Excited. I think, I think Tony might be out next week too. Oh, wow. So you might have a three for or maybe a special guest next week. You never know. I'll be, I'll be, I'll be waiting. Waiting by the phone. So. All right, well, hey, you know, I think, you know, we got a pretty good topic this week for a little bit of a change of pace. You know, we've talked a lot about obviously the economy, will there be a recession? Won't there be a recession? Obviously tariffs and the Trump administration. But this week we thought we'd do a little bit more of a fun topic and talk about investing in space exploration. So I think, yeah, I think it is after, after doing this for a while, you really do kind of see patterns start to emerge and you know, kind of the, the world that we grew up in, you know, kind of fades away a little bit and you know, the, the world approaching comes more into focus and you know, you hate to get right into Elon Musk at the top, but you know, there's many, many corporations, companies that are, you know, getting into space exploration, getting into space tourism, getting into communications and you know, at least for me, when I saw, when I saw that little Elon Musk, the, the unveiling of like the robots and the, you know, driverless taxis and all that stuff, it really became apparent, you know, we're entering into a new frontier here. So, so, so yeah, Dave, you know what, what, what are your thoughts on top about? I think you're hitting on some important stuff, Derek. You know, right off the bat it's like, I think it's really hard to picture the future before it happens. And when you get these sneak peeks, it's really like mind boggling and eye opening of what is to come. And really, you know, the way that I'm thinking about this is like I kind of brought it back to the top to start and it's like, why exactly is this important? Like what are the purposes of space exploration? So I'm just going to give you a couple like quick hitters, things to maybe nibble on a little bit here and then we can go off in Any branch we want. But scientific discovery was coming bubbling to the top there, technological advancements, and I want to hit on some of those later on, inspiring future generations. Understanding Earth, the search for the extraterrestrial life, that's always an interesting one. Human survival seems important and then resource utilization, those are like the main purposes, you know, the above board main purposes that we were seeing. What are your above board. What are you getting at? I don't know what to believe anymore, Derek. So yeah, sorry I threw you off track there. You're just headed somewhere. But really what I kind of envision this next step in the economy. You hit the nail on the head. I think maybe we can get into your topic a little bit about space exploration, but I feel like that was, you know, two or three or four summers ago now at this point when, you know, the, the Blue Origin versus Virgin Galactic, you know, trying to get private people into space. I think. Didn't we just have, didn't we just have one of those. There was, there was a celebrity mission, I'll call it, and it was, you know, I just see the headlines, I don't dive too deep in, but it seemed like it was maybe a less experienced crew, but they had a successful mission. And then, you know, it begged some questions. I was curious. I'm like, what is, you know, how easy is it to get on one of these missions? And I happened to just kind of poke around the Internet a little bit. It seems like for the Blue Origin mission, It does require$150,000 deposit, which I think is just, you know, some earnest money to get in your, your foot in the door. It seemed like when they did an auction for the first seat there, it went for$28 million. Oh, well, there you go. Yeah. So obviously some demand. There is some demand. There is some demand there. I, I don't know where it's going to level out. The Virgin ticket seems to be between 2 and 200k and 450 to get yourself a seat on the Virgin ship. Yep. So I think you hit the nail on the head right there. I mean there, there are, there is demand for this for sure. You know, just, you know, looking at something as silly as, you know, the, the landscape of vacations. I mean, vacations have gotten so expensive and that, that seems to be just a supply and demand type of thing. You know, everyone has, seems to have more and more money to go on these luxury vacations and it just pushes the price up, up, up, up and up. If when this kind of gets into more of A mainstream thing. And you can get to space for 200, $300,000. Like, people will do it. I think so. Especially like with the generations coming up where they value experiences over material items. Like, it's going to be tough to beat that experience. You know, you can be the first one on your block and in your family to talk about your trip to space and what that was like. It's going to be tough to beat that story. Yeah, for sure. Oh, what'd you guys do? Oh, yeah, we drove to the Poconos. Oh, really? I went to space. It's going to be a crowd stopper. Yeah, it might, you know, supplant the Disney World experience for those, for those takeaways, for sure. Yep. All right, well, what else you got over there? I see you made a ton of notes on this topic. I was mind boggled with this one. So really, you know, I kind of want to take it back to like, investing is one angle in it. But really what, you know, what is driving this? Like, why are, you know, why is this so important? And I kind of came across a list of like, the most important technologies that we'll call NASA spinoffs. So maybe, you know, when you're, when you're developing space travel, right. Your resources are limited, There's a lot of constraints. And what that forces you to do kind of traces back to the old saying of, like, necessity is the mother of invention. Like, when you don't have your full arsenal to work with, it really forces you to develop new technologies. And I was just, you know, kind of running through this list and seeing, you know, what meaningful things are happening here on Earth related to some of that innovation. And here's what I'm seeing. We'll run through some of these. An infrared ear thermometer. That seems important. LASIK was a spin off. We've got artificial limbs, we've got scratch resistant lenses. So that comes up. I mean, I don't know if that's gonna change the world, but that's a, that's a, that's an important one. Aircraft and anti icing systems, which are used daily. Right. At the airport. So the next one I was, I was looking at was like landmine removal, probably not so everyday useful firefighting equipment. So there, you know, there's a. And then temper, you know, tempur Pedic foam. So there's a handful of, like, practical things you wouldn't necessarily trace back to this project. But, you know, it does kind of show you how thinking outside of the box in terms of this Overarching goal develops into some practical stuff that's happened here down. Down on Earth. Yeah. You know, unfortunately, I think just like everything throughout humankind, they'll probably turn everything into a weapon. And, you know, that's kind of where I go on the robotics angle. You know, we've been seeing those robot dogs now for a while. We've been seeing those, you know, humanoid robots that, you know, jump. What is it? Boston Scientific. So, you know, they've been putting out crazy videos of these robots running and jumping around. And then you got the, the Elon Musk personal robot. You know, you'll be able to buy your own. You know, I don't even know. Robot butler. Yeah, it's the, the possibilities are endless here. Not to get too far off the path here, but it just. My mind is going to. So have you seen this topic? Like the hundred gorillas or the hundred men versus the gorilla? Oh, yes. Is this gonna turn into can 100 gorillas beat one robot? Like, where are we going with this? Right? I mean, these armies are just of the future. I don't know how much, you know, humans are gonna be involved in terms of any of the ground fighting. Right. It's gonna be drones and robots. Yep, exactly. That's the, the next thing I was gonna say are the drone and the drone technology, you know, that seems, you know, you see some, some videos on the Internet, you know, but that, that, that's going to, I mean, completely change warfare. Honestly, I'm not, not a military expert, but it seems that when that drone technology is perfected, that's going to essentially eliminate fighter pilots. So obviously you still need to, to fly around and, and do other things in the air. But, but yeah, you know, this is a, it's a technological race, you know, and, you know, to Dave's comment a little bit earlier, we probably don't even know the half of the technology that's, that's available right now. Yeah, I mean, it's. I agree with that 100%. It's like the stuff that we don't even know about is probably exponentially ahead of what, the stuff that's actually mainstream out there. Yeah. So that's, I guess, scary and exciting at the same time. But, Derek, I did, I did, just for, you know, out of curiosity's sake, I pulled a couple ETFs that are out there that are focused on, you know, this niche in terms of space exploration. There's a, you know, there's a handful of ETFs with that kind of narrow focus And I was just curious like looking back over the last like three to five year investment horizon, like how they've done relative to just the US stock market. Right. And what I've seen, there's a pretty wide range. Like if you look at the performance in that space over the last five years, there's a range of like we'll call it on annualized between 7 and 20% annualized of how that's performed. And that's in comparison to the S&P 500 which is at about 15%. So not blowing anything out of the water, but certainly some opportunities there. And I know our investment team is constantly looking at like from an angle of like risk and reward and opportunities that make sense. We've got our eyes open. Might not be quite as simple as just investing in the space blindly, but certainly, you know, companies within that space. That makes sense. Yep. You know, if you guys are interested in getting into that space, like Dave said, there is a wide range, you know, whenever you get into kind of niche subjects like this, you know you're gonna have that, you know. But one that I found was Arkx. Arkx, and that's an ETF that invests specifically in, in the, in space exploration. And one of the holdings in there is Intuitive Machines L U N R, which is a pretty cool ticker if you ask me that one. That particular company has performed well over the last couple years. So you know, it's like kind of like the, the dollar stock type phenomenon on that one. Actually had a client asked me about SpaceX recently, so that's why I kind of like this topic. If you want to invest directly in SpaceX, unfortunately right now it's a private company, so you got to, if you want to invest in it, you have to find someone who owns shares and buy them, you know, basically on the secondary market or directly from another investor. So, um, so can't get into that one yet, but I assume in the next, you know, five years, within the next five years or so that that will go public as well. Good stuff, Derek. And then with Kathy Wood in charge of those ARC ETFs, what can go wrong? Right, exactly. It seems to be going well. It was, when I saw, when I saw that ticker, it was, it was a little puzzling. I didn't, I didn't even know about it. Honestly. I feel like they changed the name of that etf. I don't, I think they added the space exploration component. It used to be just, I think I believe the innovation space. And it seems like now they, like you're saying a heavier focus on, on this piece. So it's clearly, you know, a more important growth theme for them inside of that fund. Yep, for sure. All right, well, call to action at the end here. You know, it what I think as a general piece of investing advice, you know, and we've, we've touched on this fairly recently, actually, it is a lot easier to invest in things that you're passionate about. So, you know, if you're into the whole space exploration, if you're into, you know, SpaceX, you know, blue, Blue Origin, if you're interested in Mars exploration, you know, we kind of glossed over that one a little bit. But, you know, essentially people are. There's a lot of smart people out there, if you go out there and look that are saying that we need to be. We need to be able to. To go to Mars. We need to be able to leave this planet if we need to. It might become a survival thing at some point in time. So, so that, that is an interesting twist to this whole industry about space exploration because, you know, it's not just Elon Musk saying that. A lot of people on the Internet talking about it. And it's, you know, the unknown is like, are we talking months, years, weeks, you know. Yeah, exactly. It's. I think that's the unknown part of it. But I guess earlier is better than too late. Yep, that's for sure. So, yeah. So I think that'll wrap it up for this week. Dave, thanks for joining us again. Any parting shots? No, this was a good. I like these topics. They kind of get you thinking. Yeah, for sure. Get the creative juices flowing. Yep, absolutely. And yeah, you know, it's become a topic that is talked about, you know, pretty much weekly, you know, and with many, many different avenues to get into from. From an investment perspective. So, you know, something that we'll definitely keep an eye on here in the future. And thanks very much for listening this week. If you guys have any questions, comments, or show ideas, hit us up@infowpconnect.com and we'll talk to you next week. The opinions expressed in the podcast are for general informational purposes only and are not intended to provide specific advice or recommendations for any investment, legal, financial or tax strategy. It is only intended to provide education about the financial industry. Please consult a qualified professional about your individual needs.