How to Fund Your Assisted Living Start-Up (Without Losing Your Mind)

assisted living funding assisted living grants assisted living startup costs financial planning assisted living how to fund assisted living sba loans for assisted living underwriting assisted living Aug 27, 2025

Starting your own assisted living business?
One of the biggest hurdles is figuring out how to pay for it.

This guide breaks down how to financially plan for your assisted living startup—without getting overwhelmed. From funding options to managing expenses and creating income, we've got you covered.

Let’s break it down step-by-step ๐Ÿ‘‡

Check out this video, too:  

๐Ÿ’ฐ Step 1: Know Your Funding Options

You don’t need to have all the cash upfront.
Here are the main ways to get funding:

  • Traditional Funding

  • SBA Loans

  • Commercial Loans

  • Unsecured Lines of Credit

  • Hard Money Loans (focus more on the property than you)

     

๐Ÿ‘‰ Lenders will want:

  • Credit report

  • Bank statements

  • Tax returns

  • Your business plan

TIP: If your credit isn’t great, don’t worry. You can improve it or partner with someone who has better credit.

๐Ÿ”น Grants & Subsidies

Grants are great—but tough to get if you’re brand new.

What to know:

  • Most grants are for existing businesses

  • You usually need 3+ years of operating history

  • They can typically help with things like renovations, tech upgrades, and expansion

If you want to learn more, check out the free Grant Template!

๐Ÿงพ Step 2: Understand the Top 5 Expenses

Before you fund your business, you need to know what it’ll cost to run.
Here are the 5 major expenses to plan for:

  1. Wages – This is the biggest one (50–60% of your costs) ๐Ÿ’ต

  2. Food – Meals and snacks for your residents ๐Ÿฝ๏ธ

  3. Utilities – Electricity, water, internet, etc. ๐Ÿ’ก

  4. Insurance – You’ll need liability and property coverage ๐Ÿ›ก๏ธ

  5. Debt Service – Loan repayments ๐Ÿฆ

โœ… Together, these make up 80–90% of your costs.

If you understand these, you’ll know if your business can actually make money.

๐Ÿ“ˆ Step 3: Choose a Strong Financial System

You need a system to track your money and manage cash flow.

Here are two top recommendations:

Both will help you:

  • Plan for taxes

  • Pay yourself

  • Avoid running out of money

We’ve even worked with a Profit First professional for our facilities!

๐Ÿ  Step 4: Estimate Your Income (Hint: It’s More Than Just Rent)

Now that you know your costs, let’s talk revenue streams:

Main Source: Resident Payments

  • Private Pay = monthly rate + amenities

  • Medicaid = daily rate

Additional Sources:

  • Adult Daycare – Residents come for the day, not overnight

  • Transportation Services – Get certified and bill Medicaid for rides

  • Parallel Businesses – Like staffing or home health (if you’re ready)

Your income should exceed your expenses by enough to:

  • Pay staff

  • Cover the mortgage

  • Put money in your pocket

๐Ÿ”Ž Step 5: Use the Underwriting Calculator

This tool helps you evaluate any deal financially. Download the free underwriting calculator here.

You’ll be able to:

  • Run your numbers

  • Stress test your margins

  • See if a deal is actually profitable

๐Ÿง  Final Thoughts:

  • Avoid homes with 6 beds or less if you're not planning to work in them daily

  • Go for 10+ beds if you want to hire a team and scale

  • Build your credit or find a partner who has it

  • Be consistent and plan for the worst (like low occupancy)

 

Next Steps: Take Action Today!

๐Ÿš€ Want to launch your assisted living business in the next 12 months?

โœ… Step 1: Download the Business Plan Checklist to start planning.
 โœ… Step 2:  Apply for the Assisted Living Investing Mastermind for expert coaching.
 โœ… Step 3: Follow this guide, take action, and bring your vision to life!

Got questions? Drop them in the comments below! โฌ‡๏ธ

Ready to start your assisted living business?

Join ALI Basics—our beginner-friendly program that gives you access to exclusive content, monthly calls, and coaching support to help you launch successfully.

Let’s get your vision off the ground ๐Ÿš€

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