Does Assisted Living Still Make Money in 2026? The Honest Breakdown No One Talks About
Jan 26, 2026
If you’ve been thinking about assisted living, you’ve probably asked this question out loud or in your head. Does assisted living actually still make money, or is that window already closed? I want to walk you through the honest answer, based on what I see every day in this industry. Want the full breakdown? Watch the video below๐
Assisted living still works because demand keeps beating supply
Here’s the big picture I want you to understand first. Assisted living still makes money because the demand is much higher than the supply. I’ve seen this play out again and again, no matter the market.
Every day, about 10,000 Americans turn 65. That does not mean they all need assisted living today. But fast forward 10 years, and those same people are turning 75. By 2030, every baby boomer will be over 65. A large group of people will need care, and there are simply not enough beds to support them.
This is basic economics. When demand is high and supply is low, there is room to run a profitable business.
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Demand for care is growing fast
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Assisted living beds are not growing fast enough
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Quality care can still charge a premium
The 5% rule helps you know if a market can support you
When I look at a market, I use what I call the 5% rule. This keeps things simple and clear. If you have a population you want to serve, at least 5% of that group will need assisted living.
If there are 1,000 seniors in an area, about 50 of them will need assisted living services. If there are fewer than 50 beds available, that market has room for another home. If there are already more than 50 beds, you may want to look somewhere else.
This rule is not complicated, but it gives you confidence before you ever move forward.
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Pick the population you want to serve
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Take 5% of that number
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Compare it to the beds already available
Profit comes from two simple income levers
Just because demand is high does not mean profit is automatic. Assisted living is still a business, and you need to understand how the money works.
There are two main income levers you can pull. The first is how many beds you have. The second is how much you charge per bed.
If you have 10 beds and charge $5,000 per month, that is $50,000 in monthly revenue. If you have 15 beds at the same rate, that jumps to $75,000. Or, if you stay at 10 beds but charge $8,000 per month, you bring in $80,000.
The math itself is simple. What matters is how well you plan it.
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Number of licensed beds
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Monthly rate per bed
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Full occupancy makes the numbers work
Expenses decide if you keep the money or lose it
Revenue is only half the story. Expenses are what decide if you actually make money.
I teach something called the WIFE expenses because you are married to them. They make up most of your costs. Wages, insurance, food, energy or utilities, and debt service are usually 80 to 90% of your expenses.
Wages alone can be 50 to 70% of your total costs. If you learn how to control staffing and scheduling, you protect your profit.
If you bring in $50,000 per month and spend $40,000, you keep $10,000. If you spend $60,000, you lose money. That is why understanding your numbers matters so much.
๐ก If you want help with this, grab the free underwriting calculator. It walks you through this step by step.
Full beds depend on systems, not just marketing
One mistake I see is people focusing only on filling beds at the start. Marketing matters early on, but long-term success comes from your reputation.
If you are licensed for 10 residents but only keep 5 because your systems are weak, your income is cut in half. Happy residents lead to referrals. Referrals keep your beds full.
Strong systems help you deliver better care, keep staff consistent, and protect your income month after month.
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Clear care systems
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Happy residents and families
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Strong referral relationships
Niches can increase both impact and income
One of the most powerful levers you can pull is choosing a niche. Assisted living does not have to be one-size-fits-all.
You might focus on memory care, behavioral health, Medicaid residents, disabled adults, or another specific group. When you niche down, your pool of residents is smaller, but people are often willing to pay more for specialized care.
That is why you often see higher rates for memory care than for traditional assisted living. The need is deeper, and the value is higher.
๐ก The more specific the care, the more valuable your service becomes.
Wrap Up
So, does assisted living still make money in 2026? Yes, it does, when you understand demand, run your numbers, control expenses, and keep your beds full. This business rewards clarity, planning, and consistency.
If you need help creating a business plan for your assisted living business, check out the Free Business Plan Checklist.
And if you’re ready to figure out your next step, join me for the next Roadmap Challenge, where I’ll walk you through how to get started.
Show full transcript ๐
Transcript
00:00:00
So, have you been thinking about assisted living, but you're just like, "Hey, does it really make money still?" Like, people have been talking about this now for years. Is this something that is actually going to make me money? I'm here to answer that question for you in today's video. So, make sure you stick around and figure out, can you actually make money with assisted living in 2026? Let's get into it. Hey friend, my name is Brandon Gustafson with Assisted Living Investing. I help
00:00:31
first-time assisted living entrepreneurs launch profitable purpose-driven businesses creating prosperity, purpose, and peace in their lives. I help people from I don't know how to get started. I don't even know what I'm doing to I want multiple facilities or I already own a business and I'm I'm trying to figure out how to run this. To find the best coaching program for you, go take my quiz at aliquiz.com. and we'll link that down below for you. It's a 30-se secondond quiz can help you figure out
00:00:57
which of my coaching programs are going to help you out along your path as you're trying to launch your assisted living business. And if you can stick around till the end of the video, I've got a special offer for how we can work together to help you launch your own assisted living business and create your own roadmap. So, stick around till the end of the video. If you need some helpful resources, get over to assistedlivinginvesting.net. I've got an underwriting calculator that's just right there. You cannot miss
00:01:20
it along with the link for the quiz. So, go ahead over there. Again, it's assisted livinginvesting.net. With that, let's get into today's video. We are talking about does assisted living actually make money? Does it still make money even now when you're watching this in 2026? Or, you know, maybe you're watching this in the future. But what I'm going to tell you is is going to be applicable no matter when you're watching this. Okay? Does assisted living actually make money? Let's get
00:01:46
into it. So the thing that I want you to understand when it comes to assisted living is economically it makes a ton of sense, right? We live in a world right now where the demand for assisted living is outpacing supply. So if you've ever gone to an economics class, I I remember when I was in grad school, I had to take an economics class and that for me was something I had never done before. My teacher was from a foreign country, had a really strong accent. and I had a really hard time understanding her, which for somebody
00:02:19
that didn't understand economics and how they work was really hard. But I worked really hard at it. Ended up getting a good enough grade that I could stay in my program. Anyways, what I learned from that is when it comes to economics, there are really two levers you can pull. There's supply and there's demand. And as long as from a business owner, the demand is higher than my supply, then I'm going to feel confident that I can get in there and I can make money off of this, right? That I can have a
00:02:53
profitable business. So, in the world of assisted living, our demand is up here. We have 10,000 Americans that are turning 65 every day. And that doesn't mean that Americans that are 65 need assisted living. Not by any means. Like, my parents are in their mid60s at this point. They don't need assisted living right now. They don't. But my grandparents who are still alive are in their mid 80s. Now they're getting to a part where a point where they do need assisted living, right? Regardless of
00:03:21
what you're looking at, 10,000 Americans are turning 65 every day. And so that means in 10 years from now that 10,000 Americans will be turning 75 every day. Right? So you can just see all of this that there's so many people the a the population is aging significantly by the year 2030 every single baby boomer every person that is in the baby boomer generation will be over 65. That's coming up very quickly. And by 2050 the projections are that there will be 58 to 82 million depending on how many people
00:03:57
pass away that are going to be over 65. Okay. There's a huge population. The demand is exponential. Now, like I said, not all of those people are going to need assisted living, but a huge chunk of them will. They're going to need care, and there's just not enough beds. I have what I call the 5% rule, and I use this when I'm doing my market research to validate I'm going to have enough people inside of that area to fill a bed. So, if you want to learn more about that, type in five down
00:04:29
below. We'll do a separate video that's on the 5% method, but basically what it says is if there's a population that I want to serve, at least 5% of them are going to need assisted living. So, if I have a thousand people in a specific area, I know at least 50 of them are going to need assisted living services. So, are there enough beds to hit that? If there's not, then this is a good spot for me to do assisted living. If there are, if there's already 50 plus beds, then maybe I want to look at a different
00:04:56
area, right? Very simple math there for you. Um, each situation is going to be different. That's the 5% rule and a little kind of tiny bubble. But if you want to learn more about it, type in five down below. Okay. So, ultimately what we see here is our demand is up here. It's huge. It's massive, right? It's big. And then our supply is down here. Our supply is small. It's growing, but the rate at which they're growing. So, if they started here at the exact same level, we've got demand going up
00:05:24
like this, and supply is going like this. like it's it's moving, but our demand is moving so much faster than supply. All that to say, there's a premium on really good assisted living still, and there will be for decades to come. This is still something, the silver tsunami. It's here, right? It's already here, and the wave is just going to continue growing. And there's only so much we can do in assisted living because there's also in the reality of this, there's still a housing crisis. There's just not
00:05:59
as many beds available as we need for assisted living. So when demand is outpacing supply, that means that we can charge a premium and we can provide that care to individuals that need this. It's a simple EP economics thing. So can you still make money in assisted living? Absolutely. you will be able to make an money in assisted living for a long time simply because of the pure economics of the situation. All right, so let's get into profitability when you're running your business. So
00:06:31
just because there's a supply and demand kind of thing that favors us as assisted living business owners does not automatically mean boom cool, I can make millions of dollars with this. There are a lot of things that you need to understand when it comes to running a business and becoming profitable. So, the first thing that I want to help you understand and and if you want some help with this, go check out my website, assistedlivinginvesting.net. I have a free underwriting calculator there. It's
00:06:56
the big it's a light blue box. You can't miss it. Go grab that. It's free, but go grab it and we'll help you out through what we're going to be talking about here. And this is understanding the finances and how things actually work when you're running a business. So, I want to get into that. While you're there, take the 30 secondond quiz as well. There's there's a blue box there as well for that. It's it's a darker blue box. So, go fill out that quiz as
00:07:17
well. Anyways, there's a couple levers that you can pull here. I do this a lot. This is the levers. The levers that you can pull when it comes to income. There's two levers, two main levers that you need to understand. Number one is how many beds do you have in the facility? And number two is how much money can you charge per bed. These are your big main levers when it comes to running an assisted living business. That's going to give you how much money you can actually make. So, if
00:07:45
we have a home that has 10 beds, so we're capped at 10 and we charge $5,000 per bed per month, that's $50,000 in income coming into the home, right? That's our revenue number right there. So, 10 beds, $5,000 per bed, $50,000 in revenue coming into the business on a monthly basis if we're at 100% occupancy. So, if we want to adjust that and we have 15 beds and we're still doing the 5,000 number, that's going to put us at, let's see, quick math here, uh, $75,000 in revenue coming in. Or if
00:08:22
we have 10 beds and we're charging $8,000 per month, then we have $80,000 in income. So, you can see very easily the math is is super simple when it comes to trying to figure out how much revenue can you generate right here. This is your net revenue. Okay? How much can you net off of this? What's that going to look like for you? Okay, that's the first thing you need to understand. The next thing is you need to understand your expenses because this is a business. It's going to cost you money
00:08:50
if you want to run the business. And I have what I teach my five big expenses. I call them the wife expenses because you're going to be married to them. If you want a deep dive into the wife expenses, type in wife down below, wif. And I I'll do a separate video on that. But the wife expenses, they're going to make up 80 to 90% of the total expenses that you have, your operational expenses as a business. They stand for wages, insurance, food, energy, which is your utilities, and debt service, which is
00:09:18
like your payment that you would make if you have a mortgage on the house. Any anything that you have taken a loan out for, that's your debt service. If you can figure out those expenses and how to get some control over them, specifically over your wages, wages are going to be 50 to 70% of your total expenses. Like it it's a huge number. If you can learn how to control those a little bit better, pull that lever, then you're going to be in a much much better situation when it comes to this. And
00:09:47
then for really simple um again economics and financials here when we were looking at our income we were saying 105,000 that's $50,000 in income. That's your gross income. Once you figure out your expenses then you're going to figure out what your net revenue is. So if I've got $50,000 in gross income coming in gross revenue I have 40,000 in expenses. I have $10,000 in net revenue net profit. That's the money that I get to keep. Okay, so that's the number that I want to do. But
00:10:20
if I have $50,000 in gross revenue and I've got $60,000 in my expenses, now my net is atgative10% orgative $10,000. So I really need to hone in on these. So I've got two levers when it comes to income. I've got number of beds. I've got number the amount of dollars per bed. That's going to give me my gross income amount. Then I'm going to have my expenses. and now I can increase my expenses or I can decrease my my expenses and that's what's going to increase my net revenue um what I come
00:10:54
out of this with. So you need to understand those things. It's the finances is confusing, right? That's why I give you my free underwriting calculator. Go to assistedl livinginvesting.net. I hope you kind of gathered that it's there's just a few levers here. It's not that hard, but it can be really confusing, especially if you're not a finance person. So go grab that tool. uh spend some time getting familiar with your underwriting. But if you want to know if this can be profitable, you need to understand your
00:11:22
ability to generate income. You need to understand what your expenses are, how those things are going to work, how you can pull those different levers. And once you figure that out, you're going to be in a much better situation. I would also say that your reputation and ability to stay full, to keep your beds full, is going to be really important. So, you need to have really solid systems and processes in place to keep your residents happy. That's what's going to allow you to you have your
00:11:48
number of beds that you have, right? Say you're licensed for 10, but if you don't have good systems and processes and your residents aren't happy there, your census is going to be at five. And so, even though your potential is 10 residents at $5,000 per month, the reality of it is you you can only have five in there because you just don't have good systems and processes. there's better options out there for people to go to. And so you're a five residents making $5,000 per month. And so that
00:12:17
gross is at $25,000 per month is what you're getting in. And your expenses are going to be higher than that. And so at that point, you're losing money. So it's really important for you. Marketing is important, sure, but I I think the especially in the beginning when you're trying to fill your beds initially, but once you have them full, creating this really solid reputation and creating a referral base for your facility is what's going to keep your beds full. And that's what you need to really focus on
00:12:42
is just keeping the beds full so that you keep your residents happy. And when you do that, that's what's really going to allow you to hit your income potential numbers and that's what's going to allow you to generate a lot of income here. Okay? So, it's really important for you to understand that there there's a few levers there so you can be profitable. The it it's it's not that hard to figure out how to become profitable and how to stay profitable in assisted living. The other thing that I
00:13:11
want to tell you and note is you can also niche down into specific markets. Now, when we talk about the 5% rule, let's say our 5% is we just want to serve elderly individuals. That's all we want to work with. So, we're looking at a population that is 70 plus in age. And we use the 5% rule to figure out if that's going to work for us or not. when you go down to a more niche area and some niche um uh markets that you could be working with are uh you could be working with a Medicaid population, you
00:13:42
could be working with behavioral health, could be memory care, could be disabled individuals, could be I I've worked with somebody in my success system program and their focus was on women who had been abused. So, you can choose which market you want. the 5% um uh principle, the 5% rule for market research is going to hold pretty strong there and give you a lot of confidence that if you're below that 5% threshold, you can probably move forward with it. You've got enough of a supply of people that you can hit the
00:14:11
demand that's going to work and and come into your facility. It shrinks your overall population down, but people also pay a premium to get there. So maybe they were paying $5,000 a month for traditional assisted living, but they need memory care and now that bumps them up to $8,000 a month, right? So you can see that the more niche you get, the more you're able to charge people. The riches are in the niches or there's a saying that that goes like that. And that holds true for assisted
00:14:40
living as well. The more niche you get for a specific population, the more you're going to be able to charge for that. And while it does shrink your available pool of people that you can work with, there's also not as many facilities that are offering that. And the people that really want that type of an experience, they're willing to pay a premium for it. So that's one of the another way, just another lever that you can pull as you're getting into this is think, you know, I want to get into
00:15:08
assisted living. I I I know it can be profitable, but do you want to be working with a specific niche? A niche that can work and help you uh increase your income potential and make an even bigger impact in the world. So, who are you passionate about? I'm actually curious. Type in the the population that you're most passionate about. Type that down in in the comments below. I would love to hear who you want to be focusing on as you're starting your assisted living business. Okay, we covered a lot
00:15:38
today. Um Like the video, subscribe so you get notified every time we put out content. We go live on Tuesdays and put out content on Thursdays as well to help you out as you're trying to launch your assisted living business. And make sure you share this with somebody else so that they can benefit from it. Uh what we've been talking about today is demand is far outpacing supply when it comes to assisted living. We talked about how profitability really depends on a few things. Your income, your expenses, and
00:16:02
and how you're going to have cost control over those expenses, and the different levers that you can pull, and why it's so important for you to build a solid reputation as you are launching your assisted living business, and how the riches are in the niches. And that's what's going to further enhance your ability to generate more income as you are launching your assisted living business. Now, at the start of the video, I told you I was going to give you a special offer to work with me, a
00:16:28
special invitation to work with me inside of my roadmap challenge. You can learn more at roadmapchallenge.com. I would love to have you over there. It's a coaching challenge experience where you can ask me whatever questions working on building a road map that is specific to you to help you understand what your why is and the model that you want to be working at, the type of home that you want to get into, understanding underwriting and how it actually works, understanding funding, understanding the
00:16:52
licensing process. It's so much fun. So, I would love to have you in there. Go check out roadmapchallenge.com to learn more to see if it's a good fit for you. I would love to see you inside of the the next challenge. We do them multiple times a year. I would love to have you in our next one. So, go check it out. Again, roadmapchallenge.com. Are you curious about assisted living, but you're not sure how to get started at Assisted Living Investing. I help first-time assisted living entrepreneurs
00:17:16
launch profitable, purpose-driven businesses, creating prosperity, purpose, and peace in their lives. I love helping people from beginner to I want, you know, multiple facilities or I'm already running the business. To find the program, the coaching program that I have that is a best fit for you, go check out aliquiz.com. 30 second quiz will tell you which of my programs is a best fit for you. I'd love to have you take that and see how I can help you out along your path to launching your assisted living business.
00:17:43
And remember, it doesn't take a lot, just a little bit. Just keep going step by step by step. And I promise you, if you do and you are consistent and persistent, you're going to be successful. Thanks for watching and have a great day. [music]
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