The Uncomfortable Truth About Assisted Living Investing
Sep 24, 2026
Are you interested in assisted living but still wondering if it is really the right move for you? I get it. Before you commit, you need to understand what this business really takes, how the money works, and what you can expect in the first few years.
Want the full breakdown? Watch the video below👇
Assisted living is a great fit if you care about people and want to run a real business
Assisted living can be a great fit for healthcare workers, real estate investors, and entrepreneurs. Healthcare workers already understand care, residents, and the challenges that come with helping people. Real estate investors understand homes, funding, and how to work through rules.
But there is an important difference between assisted living and simply owning rental property. You are running a real business that serves real people.
You may have staff, payroll, food, insurance, utilities, residents, and families to manage. There is a lot going on.
đź’ˇ If you want to make a difference while building a business, assisted living may be worth exploring.
You should not start assisted living just because the income sounds good
This is the uncomfortable part. If the only thing you see is the chance to make $10,000 or $20,000 a month from one building, take a step back.
Assisted living is a people-heavy business. Residents are depending on you to provide a safe, caring place to live. Your staff and their families are depending on you, too.
I believe the right person for this business is someone who cares about creating a good quality of life for residents.
You also need to be ready to hire people, solve problems, and deal with hard days. You can make the business more passive by hiring good people, but the work still has to get done.
âś… Ask yourself if you care about the people as much as the business.
Your profit comes from understanding revenue and expenses
The income potential in assisted living comes down to a simple idea: how many residents you have, how much you charge, and what it costs to operate the home.
For example, a 10-bed facility charging $5,000 per month could bring in $50,000 in revenue. If expenses are $35,000, that leaves $15,000 in profit.
The numbers can change as you create a different type of facility. If you charge $10,000 per month for 10 residents, that could create $100,000 in revenue. Your expenses will also change.
I use the WIFE expenses to help think through the main costs: wages, insurance, food, energy, and debt service.
The key is to understand your numbers before you get started.
More residents can give you room to scale
One thing I like about assisted living is that your expenses do not always double when your number of residents doubles.
Going from eight residents to 16 may mean more staff, food, and utilities. But you can also buy food in bulk and spread some costs across more residents.
That gives you room to scale.
You still need to run the numbers for your specific facility. Do not assume that more beds automatically mean more profit. Instead, use your underwriting to understand what happens when you change the number of residents, rates, expenses, and debt.
đź’ˇ Your goal is to know how each change affects your business before you make the decision.
You can choose how hands-on you want to be
Assisted living does not have to look the same for everyone.
You can be very hands-on and work in the facility. You can become the administrator and be involved in the day-to-day operation.
Or, you can hire people to handle the daily work while you focus on the business.
I operate out of state and have regular touch points with my administrators. I check the numbers, stay aware of regulatory needs, and visit the facility several times a year.
That level of freedom comes at a cost. You have to pay good people to do the work. But if your underwriting is solid, you can build a business that does not require you to be there every day.
Your first year may not look like the income you expected
This is another part people need to understand before they get started.
An assisted living business may take time to become profitable. When I bought my first existing facility, we still had to pay payroll, buy groceries, and cover other operating costs before the business was fully up and running.
With our Idaho facility, it took about six months before we started seeing a real profit. Another facility took closer to 10 to 15 months.
If you are building from the ground up or converting a home, it may take even longer.
That is why underwriting and having enough cash available are so important. You need to know how you will cover your expenses while the business gets stable.
Wrap Up
Assisted living can be a powerful business opportunity, but it is not easy money. If you care about people, understand the numbers, and are willing to keep working through the hard parts, you can build something that serves residents while also creating a profitable business.
The next step is not to rush into buying a building. Start by learning the numbers, understanding the business, and deciding if this is the right fit for you.
If you need help creating a business plan for your assisted living business, check out the 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 👇
Transcript
00:00:00
Have you been looking at assisted living and you keep thinking to yourself, I am really interested in this? I think this is a really cool idea, but I'm just not sure if it's the right move for me. I'm not willing to like actually commit to it. It's just something I'm noodling on. I don't know if I should actually do it or I don't know how to get started and you know that's really holding me back because I don't know what to do to actually like move forward and see if
00:00:23
this is the right fit for me. Well, if that's you, then this video is an assisted living business really worth it is going to be perfect for you in helping you determine if assisted living is the right fit for you. The reason why I created this video is I I see so many people in YouTube and on Facebook that are interested in the idea of assisted living, but you're just unsure whether you're going to commit or not. Just so many people that are in research mode and you're evaluating the risk versus
00:00:51
the opportunity and trying to figure it out. And that's why I wanted to create this video is to help you as you are trying to launch your assisted living business and actually make some progress. Hey friend, my name is Brandon Gustafson. I help healthcare workers start their own assisted living business so they're not stuck trying to figure out and know exactly what they should do next. And if you need some help and some guidance with that, get over to assisted livinginvesting. I have some free
00:01:15
resources over there for you. Would love to help you out. And if you are unsure of which program I have is the best fit for you, take my quiz, aliquiz.com. We'll just have a link QR code for you down here below. Take that quiz. It will help you out as you're trying to figure out the best way to actually get started on your path to launching your assisted living business. All right, now with that, let's get into today's video. Is an assisted living business really worth it? Now, there's a few things that I
00:01:43
want to really chat with you about. Number one is who is this business a really good fit for? This is a great question. Now I just told you that I help healthare workers launch their first assisted living business. And that is true. I think healthcare workers are a great fit for assisted living businesses because you have been in the trenches. You've been working through things. You have been trying to find ways to help people out and just like you're providing that care already. You probably know this business
00:02:12
better than most people and you think and I think you're right could probably do this better than anybody else out there. So, I think that this business is a great fit for you if you're a healthcare worker. Now, if you're a real estate investor and you're watching this, I think this is a great fit for you as well because here's the thing with assisted living. You have two components. You have the healthcare component and you have the real estate component. And that real estate
00:02:39
component is the process that you have gone through as a real estate investor where you're buying homes and you understand the funding aspect of it and how to get in and be creative with it and you're going to be really really successful when it comes to getting to that point. You've dealt with a lot of rules and regulations with your real estate investments. You're going to encounter some of those things as well here. They're going to be different, but you're going to be able to navigate
00:03:02
them. I think you can be very successful and I think assisted living is one of the more lucrative ways of getting into real estate and and it's earning potential for you. So, I think it's a really good fit for you there. Where I want you to maybe push pause is think about, do I really want to do this? Because here's the difference between investing in assisted living versus investing in just single family units or even multif family is you are running a business like a legit business that is
00:03:36
generating millions of dollars per year and it's hard. You have a lot of staff uh like we have I think 12 staff at one of our facilities. you're going to be handling a lot of extra things and payroll and uh making sure you have the right type of insurance and meal planning and uh there's just a lot of stuff coming in and out. So, I want you to be aware of that that this is uh you can hire people to do this for you, but it depends on how passive you want this to be. You're running a business here
00:04:04
and that can be hard and you're dealing with lives like your staff, your residents, their families. You've got a lot of people who are there. So, I just want to be like have a frank conversation with you. If you're okay with that, then this is going to be a great business for you. I also think this is an incredible opportunity for entrepreneurs that want to start a business and want to make a difference. Now, the thing that I would like to say is if you are passionate about caring for people and creating a good quality
00:04:30
of life, I think assisted living is one of the best businesses to be in. And we want you in this industry. We need you in this industry. But if you're just at this looking at it and like, "Oh, wow. I could make$10,000 $20,000 per month with one building. Like that seems great. That's why I want to do it. Assisted living is probably not the best fit for you because there's so much involved and there are a lot of bad actors in the industry already. And frankly, we don't need you in the industry. If that's you,
00:05:00
if you're only in this for the money, then go find something else that will make you a lot of money, okay? because you have so many people that are relying on you and so many people that need to have good solid homes. So the person that assisted living is the best fit for is the person that is passionate about caring for individuals. And I don't care if you're a healthcare worker, a real estate investor, an entrepreneur, somewhere in between. If you are passionate about creating that type of
00:05:30
environment for people, then this is the right fit for you. All right. So, who should not start an assisted living business? The person that is just in this for the money. You like just don't do it. Um, [laughter] like I said, we don't need you. Um, there are other ways for you to make money. And I'm not saying that you're going to be unethical at all. And honestly, I hope you would not be if you're watching this video, but if your main focus is just money and you don't care that much about the people, this is
00:06:00
probably not the best fit for you because this is a peopleheavy business. So, and it also I would say if you are scared of the idea of running the business or hiring people to run the business, then it might not be the best fit for you as well because there can be headaches. There can be a lot that goes into this. My healthcare workers, y'all know this more intimately than anybody else. There's a lot of work that goes into running these businesses and running these facilities and it can be a
00:06:25
lot of long hard days, but also it is extremely rewarding. So, if that is something that scares you, then this is probably not the best fit for you. Okay? I really just want to have a frank conversation with you here today. Now, let's talk about, now that we got that out of the way, out of the way, who this is for, who it's not for, and hopefully you've kind of self- selected yourself into one of those groups. Let's talk a little bit about income potential versus the effort required. So, your income
00:06:54
potential, and I' I've talked about this quite a bit. Um, there's a simple formula. If you want to learn more about this, I teach a free workshop. would love to have you there. Type in workshop. We'll get you a link. Go to assistedlivinginvesting.net/workshop. We'll have links down below here in the description for you on YouTube. So, go check that out. But your income potential is based off of how many residents you have and how much you're charging them. These are your revenue
00:07:15
pull sticks, right? You can pull those things and it tells you how much money you're going to bring into to the facility. And then you're going to have your expenses. And I teach what I call the wife expenses. WFED, wages, insurance, food, energy, which is your utilities, and your debt service, which is like your lease payment, your rent payment, your mortgage payment, something along those lines. If you want to learn more about that, just type in waif wedd down below. We'll get you to a
00:07:39
video that kind of goes through that process for you and helps explain it to you so you know exactly what you're getting into. But you need to understand that you have your revenue, you got your expenses, that's going to result in your profit. So, as a quick example, let's say you have a 10 bed facility. You're charging $5,000 a month. That's $50,000 in revenue. And then if you have $35,000 in expenses, that's $15,000 in profit that you're going to be able to realize.
00:08:07
But if we shift this and we say we want to do really high-end amenities and we want to create this really cool experience, we're actually going to charge $10,000 per month. 10 residents, $10,000 per month. That's $100,000 in revenue. Our expenses will probably go up a little bit. We're just going to say 50,000 uh to kind of illustrate the purposes here. That's $50,000 in profit. Okay. So, you got to create this. And the cool thing about assisted living is you can kind of choose what rates you
00:08:32
do. And depending on the house that you have, you get to choose how many residents you're going to bring into the home as well. But the more residents you have in a home, the more revenue you're going to be able to generate. All right. Now, the more residents you have in a home, does that mean that you're going to have more effort required? Like, if I have eight residents versus 16 residents, how big of a difference is that? Honestly, from a staffing perspective, probably not going to
00:09:00
change very much. Maybe you need a little more staff. Maybe your food's going to be slightly higher. Your energy is going to be slightly higher. But this isn't like you're you're taking eight residents to 16 residents and you're doubling all your expenses. It's not the case. you actually get some ability to scale there. You're going to buy food in bulk. You're going to get probably actually better insurance rates and it probably is going to actually increase your ability to get funding for the
00:09:25
business if you have 16 residents versus eight because your ability to cover the debt service, your loan payment, your mortgage payment, it increases as well. And so, you need to just kind of be aware, hey, these are some things that I've got in here. Uh, these are the different levers. Can I be profitable now? Do you need more staff? Maybe. Maybe you need more staff. Is it harder to run an eight bed versus a 16- bed facility? As a person that has done this for since 2020, no. It's actually, I
00:09:56
think, probably a little bit easier if you have more residents because they entertain themselves and creating programs that that people are more excited about and uh you have more staff, which it can be a headache. Yes. but and it definitely makes your payroll higher, but there's more staff to kind of spread the workload and people are less likely to get burnt out. So, there's actually some benefits there to having more beds in the facility. Kind of cool, right? So, you increase your income potential and you maybe
00:10:29
if anything, your effort is kind of a wash. It's not going to be adjusted, which is kind of cool. Now, let's talk about hands-on opportunities versus having it be passive and the reality of that. If you want to be hands-on, here's something cool about assisted living. You can do that. You can be as involved as you want to be. If you want to become the administrator, you can go through the process, become an administrator. You can work in the facility all day, every day. If you want to, you can do
00:10:53
that. You can hire people as well to help you out with it. But you can be as hands-on as you want. Or you can do something like me who operates out of state. If you're interested in learning more about that, type in out of state down below. I'll tell you a little bit more about that story. But you could be somebody like me. I operate out of state and it's about as passive as I would want it to be. I go to the facility three to four times a year. We check in on things. I have regular touch points
00:11:20
with my administrators who handle the day-to-day, but I kind of stay out of their way and let them run the business and then we just check our numbers and make sure everything's going well. We're updating things from a regulatory standpoint and making sure everything's in a good spot there. But yeah, you can do that there as well. You don't have to be the administrator. You don't have to have a masters in healthcare administration like I have. You don't have to have even worked in healthcare.
00:11:42
My dad, who's my business partner, it comes from the construction industry. So, you don't have to be that type of person. You can just hire people to do the work for you and you can make this something that is actually very passive. it's going to come at a premium. You're going to pay a cost for it. But if you have done your underwriting correctly and you're confident in your numbers, you're actually going to feel pretty good that you're in a good spot there. So, if you
00:12:08
want actually help with that underwriting typing calculator down below, I got a free underwriting calculator I can get you over get over to you uh send you to a link for that. Now, these are some of the cool things about assisted living that you get to choose. uh you get to choose how much effort you want to put into it, how hands-on you want to be, if you want this to be passive or not. And that is something that I think is really cool about assisted living. Let's talk really quickly here about
00:12:35
what success usually looks like in the first few years for assisted living because I also want you to understand what that looks like because this is not something that is instantly an overnight success either. I'm going to use an example. Let me share my story. So, I was getting into assisted living and we bought our first facility, an existing facility. And one of the benefits of buying an existing facility is you already have staff. You already have a residence in place. But there were still a few things that you
00:13:07
have to take care of. You're still going to have to pay payroll day one without having any money in the bank. You're still going to have to buy groceries. You're still going to have to do a few things. And that puts you a little bit behind the eightball as you're getting started. Uh because you're going to have these big operational expenses you got to take care of. And I actually I teach you in my program, my coaching programs that uh you should be asking for extra operational um money upfront when you
00:13:34
start working with a lender. And I teach you how to do that in my programs. But you definitely should do that. So we had taken out a bit of a loan uh tagged it on top of our loan to buy the home. uh had an extra $40 $50,000 in the bank. Allowed us to make those payments to pay payroll and buy groceries and all of those things. And it took us a few months for us to start getting that money back because we had to go through the process. We work with a Medicaid population. Took a while for us to get Medicaid certified so we could
00:14:05
bill Medicaid so we can get collected we could collect money from Medicaid. That took a little bit of time and it was probably uh with our facility in Idaho, it was probably about six months in before we started seeing a real profit on the business. But from there, it has been very consistent at being profitable. Okay? Some months are better than other months. Sometimes you have big expenses. You know, the water heater goes out or you got to pay property taxes. And so what could be a $10,000 a month type of a thing sometimes that
00:14:37
drops down to a,000 2,000 you know somewhere in that range a much lower amount but overall generally we've been able to be profitable over that period of time okay and that is something that I think is the reality in the beginning you will probably not make money 6 months is probably a little bit fast frankly our facility in Colorado before we sold it we were profitable probably at about the 10 to 15 month mark um is how long it took. Again, an existing facility. If you're going to build
00:15:08
something from the ground up, you're buying a home, you're converting it into assisted living, something like that, it's probably going to take you a little bit longer. You will probably not be profitable in the first year, and that's okay. It might take you two years to get there, but most businesses that is the case. And so, what you need to do is kind of weather the storm. This is why underwriting is so important for you to do to understand the numbers, to understand how the revenue comes in,
00:15:36
understand how the expenses work, and understand how much money you are going to need to ask for so you can have money uh in the bank to help you out. And that can come in the form of a loan. It could come in the form of line of credit. Uh there's a lot of different ways that you can get access to th those funds to help you meet those expense obligations that you have. But I just want you to also be clear that uh it can take a little bit of time for you to generate income. But over time, if you have created a solid
00:16:07
business and you have created a plan and you're working the plan, then you can be very successful and very profitable long term. And the more that you understand how much money it's going to take you in those first two to three months to get things stabilized, the more successful you're going to be because then you won't be stressed out about making payroll and buying the food and then things start to even out and then a few months later you're going to uh start generating a profit. Okay, so those are
00:16:38
the types of things that I think you need to be aware of as you're trying to get started on here. So, is an assisted living business really worth it? Yes, I think it is. I think it is still one of the best investments that you can be making. We live in a world where we are at the the beginning stages of the silver tsunami still. There are so many people that are going to age into needing assisted living services in the coming years. And we have a huge shortage of beds that are available in the United States. And it is something
00:17:10
that on the horizon like this is the time to get into it. you're going to see how much success you can have and this is going to blow you away. I hope you found this video helpful. I hope you are seriously considering getting into assisted living because I think we need people like you that care a lot about the residents and are willing to put in the work to help them uh get the care that they need. So, if you found this video helpful, like the video, subscribe, ring the bell as well so you
00:17:35
get notified every time we put out content like this. helps other people find the channel as well because there are so many people like you that need to find this so we can get more beds and serve this population that is going to need these services. It's so so important for us to get to that point. And if you feel like you need some help doing this and figuring out exactly how to get started, type in workshop down below. I've got a free workshop. Would love to have you in there with me and
00:18:00
help you out as you're trying to launch your assisted living business. Or go to assistedlivinginvesting.net/workshop. have links down below for you here in the description on YouTube. Are you curious about assisted living, but you're not sure how to get started? At Assisted Living Investing, I help healthcare workers start their own assisted living business so they're not stuck trying to figure it out and know exactly what they should do next. And remember, it doesn't take a lot, just a
00:18:23
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. >> Hey, it's future Brandon. I totally forgot when I was recording a little bit earlier today that I needed to remind you if you found this video helpful, make sure you go and watch this video. We're going to watch that one, okay? And hey, if if you don't like that one, but you want to watch another one, watch the
00:18:46
other one that YouTube's going to recommend for you up there as well. Okay? Thanks for watching and have a great
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