What Even Is Assisted Living (And How to Turn It Into a Profitable Business)
Mar 04, 2026
Has assisted living started popping up in your feed and you’re thinking, “What even is this?” A lot of people confuse assisted living with things like nursing homes. Let me break down what assisted living isand show you how this business can become a profitable and purpose-driven to help you obtain time and financial freedom while leaving a legacy for your family.
Want the full breakdown? Watch the video belowπ
Assisted Living Fills the Care Gap Most People Miss
When people hear “assisted living,” they think nursing home. That’s not correct.
Assisted living sits in the middle of the long-term care spectrum. On one end, you have independent living. On the other end, you have nursing homes. Assisted living is right in between.
In assisted living, you help residents with activities of daily living, also called ADLs. These include:
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Dressing and grooming
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Bathing and toileting
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Medication management
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Meal prep and balanced nutrition
You are not providing medical or clinical care. You are not running a hospital. You are providing daily supportive living.
The goal is simple: safety, dignity, and independence.
I’ve seen this firsthand. When residents move in, they are not looking for a hospital. They want community. They want friends. They want to feel normal again. You give them that.
Assisted Living Is Not Just for the Elderly
Most people think assisted living only serves seniors. That is not true.
You can serve different populations depending on your license and your heart. I had an assisted living home in Colorado that focused on mental health. We had residents in their 20s all the way up to their 80s.
You could also serve:
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Adults with disabilities
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Individuals with autism
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Residents with memory loss
Memory care is another category. It is similar to assisted living but includes extra supervision for dementia or Alzheimer’s. Nursing homes, on the other hand, provide 24/7 skilled nursing care for people with high medical needs.
Here is the simple spectrum:
Independent Living → Assisted Living → Memory Care → Nursing Home
Assisted living is the sweet spot. Residents may stay for years. You build real relationships. That long stay also creates a stable income for your business.
How Assisted Living Actually Makes Money
Let’s talk about what you really want to know. How does this make money?
Assisted living is a monthly rent model. Residents pay for:
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Housing
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Food
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Care and supervision
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Laundry and daily support
Let’s say you charge $5,000 per month per resident. If you have 10 residents, that is $50,000 per month in revenue.
That sounds great. But this is still a business. You have expenses.
I call them the W.I.F.E.D. expenses because you are “married” to them:
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Wages
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Insurance
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Food
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Energy (utilities)
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Debt service
If your expenses are $40,000 per month and your revenue is $50,000, you are making $10,000 in profit.
But here is what I coach my students to do. Never underwrite at 100% occupancy. Aim to hit your profit goal at 80% occupancy. That gives you breathing room. If a bed becomes empty, you are not panicking.
If you need help running your numbers, grab the free underwriting calculator. It will help you see if this model works in your area.
Why This Business Model Works So Well
There is a reason you keep hearing about assisted living. The demand is massive.
According to the U.S. Census Bureau, around 10,000 Americans turn 65 every day. By 2030, all baby boomers will be over 65. This wave is often called the “silver tsunami.”
Not all of them will need assisted living. But millions will.
By 2050, it is projected that between 58 and 82 million Americans will be over age 65. There are not enough beds today to serve that future demand.
This business is also recession-resistant. People need care no matter what the economy is doing. Some residents pay privately. Others use long-term care insurance. Some qualify for Medicaid.
Care does not stop during a downturn. That stability is powerful.
On top of that, assisted living combines real estate and operations. You get:
π‘ Real estate ownership and tax benefits
π‘ Monthly cash flow from operations
π‘ The ability to scale with systems
The more you build strong systems and standard operating procedures, the less the business depends on your personal time.
Wrap Up
Assisted living is not a nursing home. It fills the care gap between independence and full medical care. It provides safety, dignity, and community, while creating a real opportunity for profit.
If you feel called to serve and build something meaningful, this could be your path. Take it step by step. Run the numbers. Build the systems. And keep moving forward.
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 π
Transcript
00:00:00
has assisted living started popping up in your feed all of the sudden on YouTube or other social media platforms and you're like, "What even is assisted living? Like, I I don't even understand it." And how can this be a profitable business? Well, in this video, I'm going to tell you all about that, help you understand exactly what assisted living is and how you can turn it into a profitable business that also helps give you prosperity, purpose, and peace in your life. So, if you're interested in
00:00:26
learning more about assisted living, what it is and how it works, and how you can turn it into a profitable business, make sure you stick around for today's video. Hey friend, my name is Brandon Gustoson. I'm with Assisted Living Investing. I help first-time assisted living entrepreneurs launch profitable, purpose-driven businesses, creating prosperity, purpose, and peace in their lives so they can have success and have this rewarding experience of working with people and helping just make it a
00:00:56
huge impact in people's lives. I love doing what I do and would love to have you join me in my upcoming roadmap challenge. Go check it out at roadmapchallenge.com to figure out how to create a roadmap for launching your assisted living business or stick around to the end of the video. I'll tell you a little bit more about exactly what the challenge is. And if you need some help getting started, go check out my book, The Profitable Assisted Living Facility. You can get it on Amazon. It's a
00:01:20
best-selling book in a couple of categories on Amazon. So, would love to have you get that or you can go to thebook.com and you can get access to it there as well. And if you need a free underwriting calculator to figure out if this is actually profitable, go check out assistedlivinginvesting.net. You can see the big blue light blue box that says get your free underwriting calculator. or do that. Or hey, if you need some help but you're just not sure, hey, which of these programs is this this guy's going to tell me about? Uh,
00:01:46
which one's the best one? I have a quiz for you. Go to aliquiz.com. Would love to have you take that 30 seconds. Let you see which of my programs is a good fit for you. So, go check it out. Now, let's talk about it. What even is assisted living and how can this become a profitable business for people? Because most people when they think of assisted living, they automatically think of nursing homes. And honestly, they're wrong. That is not what assisted living is. The things that we do inside of this world of assisted
00:02:15
living is very unique, very niche. And it kind of serves this special gap between like, you know, I need a tiny bit of care. Could probably have family help me out. I can do a lot of things on my own where you're independent to I need a nurse that is helping me 24/7 and helping me out with everything that I do. There's this care gap right here, right in the middle. That's what we do in assisted living. Uh we serve people that are in that care gap. It lets us work with people who might need some
00:02:44
help with like, you know, activities of daily living is what we call it or ADLs. These activities of daily living are things like getting dressed. It could be, hey, I'm prompting you to get dressed or it could be I'm helping you get dressed or undressed or helping you use the toilet, reminding you to use the toilet, feeding you, making, you know, helping you get balanced in nutrition meals. Maybe it's medication management. You've got a lot of pills that you've got to take for certain uh different
00:03:11
ailments and just remembering the entire schedule can be really hard and confusing. If you've ever had a loved one who is older and you realize they have a lot of pills that they have to take for all kinds of different things to help them out and they have to be taken at certain times during the day and it can be very confusing. So that's something in assisted living we help out with is medication management. Now in assisted living, we do not provide medical or clinical care. We do daily
00:03:39
supportive living is what we provide. So we may have a nurse in the facility that we may hire or contract out, but this is somebody that is oftentimes coming in to develop care plans, not providing clinical care. Um they they just have their clinical expertise when we're trying to create these plans for our residents to make sure their care needs are being met. But we don't provide the clinical aspect. And when we do, if there's a nurse in there that is providing it, it is not under our
00:04:06
purview. It is under their license. It is something that is completely different. Okay? So, we do not provide medical care. We help out with those activities of daily living that I was talking about. And we focus on safety, dignity, and independence. We want our residents to have like their own life. If we try to provide them with activities and fun things to do inside of the facility that they can choose to do or not choose to do, but they can live a normal happy life. They're just kind of living it with a bunch of other
00:04:34
seniors, a bunch of other people that are of like mind and age and have a lot of things in common with them. And it's actually something that is really helpful because again going back to the example, if you have ever had a loved one, an elderly loved one, you know that at some point they look at the obituaries and all of their friends are starting to die off, right? And so they're kind of feeling alone. And we give them this sense of community and the sense of, hey, you still have autonomy and you can still choose to do
00:05:00
things and we've got fun things for you to do. You don't just have to sit at home alone watching TV all day. You could come here and watch TV all day with people that you know and enjoy. Or you could do a puzzle or you could play bingo or we could like at our facility we've actually done like fantasy football or football pickums or those types of things. You can do fun activities that people can get really ingrained in. Plus, you know, parties for things like Halloween and Christmas
00:05:25
and New Year's and Easter and just all of these fun activities. We're building in a lot of experiences for our residents to just enjoy life safely, do it with dignity, and give them some independence that they probably wouldn't have if they were living on their own. There's a level of dependence there, but also, hey, at some point, you kind of need some help, right? So, this is what we do inside of assisted living. So, for those of you that are wondering, you watch this video cuz you're like, what
00:05:51
even is assisted living? That's what we do. We provide this really fun experience while helping our residents maintain their dignity, helping them have fun, livable experiences, enjoy life and and just have a fun time. Okay, but I want to come back here to this kind of continuum of care. When it comes to long-term care and senior care, I'm speaking specifically here about long-term care. I do want to point out something. Assisted living does not necessarily have to be for elderly. I had a home in Colorado where we focused
00:06:22
on mental health. We had residents in their early 20s that were in our facility all the way up to 80 plus. So, we had this very huge group of people that we were working with. I coach people, somebody that wants to work with disabled adults. So, there's a a very wide variety of types of people that you can serve here in the world of assisted living does not have to be elderly care, which is also something that's really cool. So if you have like this desire, this experience with persons who have
00:06:49
autism, then that could be something you could turn a home into a home for autistic individuals. And it it's basically assisted living. It might be licensed or called something slightly different in your home or in your state, but it is effectively the same thing where you're serving these people and helping them out. This is what assisted living is. It varies by population, but you get to choose who you're going to help, and it's super super rewarding. So, I would love to have you kind of get
00:07:17
into it if you're interested in it. But, let's talk about this continuum of care here. So, there's kind of one end to the other end, and I I just want to share with you a little bit of what that looks like. So, assisted living versus the other types of long-term care. One end over here, you know, I don't know. Let's see if we can get my hand over here. You've got your independent living. This is people who they don't need care. They they probably just need somebody to do
00:07:40
some light housekeeping for them, maybe some meal prep, but they don't need any care. And the thing with independent living is you actually cannot provide care. If you start providing care, then you are overstepping your bounds. And while it is not a licensed type of facility, it it can come under grounds for fines and even just like not allowing you to run that type of business. Um, so you need to be very careful. there there's a line once somebody starts needing care. You could bring in somebody that does home health,
00:08:11
that's fine because you're basically providing a space for somebody to live. So, as long as somebody else is providing the care, you're fine. But really, it's like light housekeeping and maybe some meal prep. That that's about it. Or maybe you're buying groceries and they're doing the meal prep or something along those lines. But if it's helping with toileting or dressing or medication management, you are not allowed to do that in independent living. Okay. Then there is over on this other spectrum
00:08:36
there's nursing homes. Nursing homes are 247 nursing coverage. So they are declining significantly in their health. Um they are getting closer to death and they need assistance with everything. They need help getting out of bed all the time and it's two people that are doing it and they need help eating and they need help changing and they need frequent medication administration whether that's pill or through injection or something along those lines. Um that's what's happening in a nursing
00:09:05
home and often times individuals in a nursing home are closer to death and so they are not going to be in that nursing home for quite as long uh maybe a year. assisted living, which is in the middle here, is some like we have residents that have been with us for over five years. Um, and in our Colorado facility before we sold it, there were residents that had been there for 20 plus years. Like you can have people in assisted living for a really long time. Just kind of depends on where they're at in the
00:09:32
spectrum. You can also have people that pass away in assisted living, so you want to be aware of that. But oftentimes you're going to have residents that are staying with you for a much longer period of time, which is really cool because you get to develop these relationships with people, right? Another thing that's like in the middle here of this continuum. So, we've got independent living over here. We've got nursing home over here. Let's see. There we go. Hands are straight, right? So,
00:09:55
we've got these these ends. Assisted living is in the middle. Something else that's in the middle, but maybe slightly skewing over here to the nursing home side, is what we call memory care facilities. So, this is going to add additional supervision because this is individuals who are dealing with memory loss issues, things like dementia or Alzheimer's. Um, these are the staff inside of a memory care unit are going to need to have specialized training on how to deal with individuals who fall
00:10:22
under this category of memory care. If you're just a traditional assisted living and you're not able to because of your license serve a population that has memory care loss or needs memory care, then you will have to transition them over to a memory care facility, a facility that specializes in memory care. So, you just have to be really careful with the amount of care, the type of care that you're providing to your different residents. But that's kind of the spectrum. But the type of
00:10:48
care that happens inside of an assisted living home or a memory care unit is very similar. You're just dealing with slightly different populations. So, a lot of the the work that you during is more activities of daily living in a memory care facility and not necessarily nursing or clinical in nature. Um, you're just helping people prompt people. You're helping out with bathing and dressing and toileting and uh food and medication management, those types of things. But if it ever gets beyond
00:11:16
that, they may need to go to a nursing home. So that's kind of the spectrum that happens inside this world of long-term care. There's a little bit of things that go in between and and things like that, but those are the four main categories. Independent, assisted living, memory care, and nursing homes. So I just want to make sure that you understand what that looks like. So now, let's get into it. How does assisted living actually make money? So, this is something that can be really confusing
00:11:40
for people as they're they're looking at this and like, "Yeah, I'm seeing assisted living. I'm a little confused at what it is." So, you know, I watched this video and I liked it, so I, you know, gave it a thumbs up and I rang the bell cuz this guy's awesome. I want to subscribe. So, you did all of those things, right? Thank you, by the way. But now you're like, "Well, how do I make money out of this thing? I know people are talking about it, but how does that actually work?" So, let me
00:12:03
kind of break this down for you so you understand exactly how the money comes into this. A resident when they go into assisted living is going to pay for all the services that we just talked about. You could have a private pay resident. You could have a resident that has long-term care insurance. You could have somebody that's on Medicaid and Medicaid will reimburse you for the services that you're providing. There's a few different ways that you can get reimbured, but essentially there's
00:12:26
monthly rent that is paid by the resident and your income is based on occupied beds. So, you take the amount of money that somebody's going to pay you. Let's say it's $5,000 a month, right? And I know like some of you, you're like, "Whoa, what? $5,000 a month? That's ridiculous. Why would you do that?" You have to remember they're paying for lodging, for food, for the care that they're receiving. You're doing laundry for them. You're you're taking care of all of this stuff. So,
00:12:50
they're paying for a lot of just like convenience factor, right? Plus the care that you're providing. So, they most of the time these people don't have houses anymore cuz they've sold them. and that's what they're using to pay for their services here in assisted living. So when it comes to that point, you've got this monthly amount. Let's say it's $5,000. Okay? And then you have a certain amount of residents in your facility. Let's say it's 10. So you
00:13:13
would say $5,000 times 10 residents, that's $50,000 in income. Boom. There you go. That's how you get your income in assisted living. Now on my website, assistedlivinginvesting.net, you can go and grab the the light blue box there. Get your free underwriting calculator. go grab that. It will help you understand exactly how some of these numbers work and and you can kind of plug in some numbers there and see if it's going to work for you. So, go check that out. But what I want you to realize
00:13:38
when you're getting into this is don't rush into and be like, "Cool, like a 10 residents, $5,000 a month, that's $50,000 in income." Yeah, why not? Like, this seems super simple. You do have to realize this is also a business, though, and you're going to have expenses, and they are expensive. So, you're going to have the top five expenses. I call them the wife expenses. So, if you're interested in learning more about that, type in wife down below. W I feed D. They're the wife expenses because you
00:14:03
are married to them. As cheesy as that sounds, it's true. Like, you can't get rid of these. They're going to exist. They stand for wages, insurance, food, energy, which is your utilities, and your debt service. You're going to have all of these things kind of boom. You got to deal with them. And let's say just for argument sake, you've got $40,000 in expenses in this facility that has 10 beds. So that $50,000 in income, well was pretty cool. All of a sudden you got to pay $40,000 to run the
00:14:31
business. It's like, you know, I don't know if is that worth it. So that's where you really have to kind of get comfortable with the numbers to make sure this is going to work because your income your profit that you're going to take home is your income minus your expenses, right? This it's simple. So as long as you have more income than you have expenses, you're going to turn a profit. You just have to realize that, hey, if I'm charging somebody $5,000 a month and I don't have them paying me
00:14:56
anymore, that's $5,000 lost in income. If I have two or three of them, that's 10 $15,000 in income that I'm losing. Now, depending on where my expenses are, I could still potentially be profitable. And the example we're we're using here, I could be breaking even at eight out of 10 residents, right? So, reasonable. I would what I really strongly encourage you to do though if you're trying to figure this out is have that $10,000 income gap that's your goal. Do that at 80% occupancy. So that means you've
00:15:26
either got to increase the volume of residents you have so that uh you know math works for you or you raise the rates that you're charging your residents. You got to figure out how you do that. But I highly suggest that you get your profit goal, the the take-home pay that you want off of 80% occupancy. It's what you should be striving to do and making sure the numbers work for you there. And then anything over that is just gravy and you're doing awesome. It also makes it so that your break even
00:15:53
point is closer to 60 or 70% which gives you some extra breathing room which is something that I want you to do as your coach. This is what I'm telling you to do. uh when you do your underwriting, make sure you you're comfortable with it and don't just assume you're always at 100% occupancy. All right. So, why does this model here that we're talking through work for investors? This is a valid question and really it is there's this incredible demand for the aging population. Uh so, every day there are
00:16:24
10,000 Americans that are turning 65. And like there there's this thing, you probably have heard of it, the silver tsunami. Like there's just this incredible amount of people that are coming and aging into assisted living age and not all of them are going to need it. But the baby boomer population, the baby boomer generation will all of them will be over 65 by the year 2030 as of the recording of this video. That's just like four years away. That's not long. So this is coming very quickly. It
00:16:54
doesn't mean that all 65 year olds need assisted living. It doesn't mean that all 80 year olds need assisted living. But it does mean there's a lot there are millions who are going to need this type of care as we get into it. And the amount of beds that are available is not that many. By 2050, the projection is that there will be 58 to 82 million people that are over the age of 65. Okay. So even if we I I don't even know how to like quantify this 10% of that, right? That's 5.8 million or 8.2 two between
00:17:29
5.8 and 8.2 million. That's a ton of people. There are not that many beds that are available in the nation today. There's this just this huge amount of of volume of people that are going to need it. There's this huge demand. And so, you can see the silver tsunami. It's coming. You got a ton of people that are going to need assisted living services. Get on, ride the wave now. Establish yourself. Create some good policies, some standard operating procedures, some good KPIs. know how to run the business
00:17:56
so that in the next 2 3 4 5 years you get hit with the tsunami, you've got 10 facilities, they're all charging $5, $6,000 a bed and and you're making a ton of money, right? People need this this service. It is absolutely crucial for them to have it. You're not picking on somebody here in the world of assisted living. you're not charging them more than what is marketable rates because if if they don't get the care from you, they're going to need it from home health, which is just as expensive, if
00:18:24
not more so, than assisted living. So, they they're going to need the care in some capacity. You might as well be providing that care and helping people out through the process. All right, jump on the wave now. Hit it because the demand for the aging population is just going to balloon and just be just gigantic. Jump on. It's also recession resistant because everybody needs care. So whether they have a lot of money or not, if they don't have a lot of personal funds for it, they can qualify
00:18:54
for Medicaid and Medicaid will pay you for it. So this is something that if you're interested in learning more about Medicaid, by the way, just type in Medicaid down below and I can make a separate video for you on that to help you understand exactly what that looks like. But because it is backed by government funding through government programs, you're even if somebody doesn't have the funds, the government theoretically will have the funds or they will be willing to use funds to pay
00:19:19
for assisted living services. And so you're kind of recession proofing yourself because you have the ability to have people pay you regardless of the situation of the economy. Um, so it's it's huge for that. It also, this is really cool, combines real estate and the tax benefits that come with owning real estate with an operational business that can generate cash flow. Now, that can be really hard sometimes because you have all of these balls in the air and things like that, but you can also hire
00:19:46
people to do a lot of this stuff for you and to help you be successful. So, you get the best of both worlds. You get you get to have a a business, a small business. You get to learn how that works. you get real estate, the benefits that come with owning real estate, and and just you get to combine this this incredible set of of things. And it's super fun to be able to see that. And it will scale with systems, not with time. And so the better you create systems, the more standard operating procedures,
00:20:14
the more systems you create, the more successful you can be, the more profitable you can be, the more facilities you can have, the more success you can have. And so you want to do those things. And it's not you adding more time to it. It's just figuring out how to play the game and um how to move forward. Now, I coach people on how to do this. So, if you want to learn which of my coaching programs is best for you, then go check out my quiz, aliquiz.com. Would love to have you over there. Now,
00:20:40
let's really quickly recap all the things that I talked about today. We talked about what assisted living actually is. We talked about the the continuum of care when it comes to long-term care from independent all the way up to nursing homes and where assisted living fits on that. And then we talked about how assisted living is going to make you money, help you actually be profitable so you can make money. And we also talked about why this model is going to work for investors. So if you're interested in any of this,
00:21:08
take my quiz at aliquiz.com. Also, join us for our next roadmap challenge. I tell told you at the start of the video that hey I do a challenge. It's a live challenge. It's coaching you live. It's a live coaching experience. You're going to be in a room with me, virtual room with me. I'm going to coach you through and building your specific roadmap specific to you about your scenario, helping you understand the finances and the licensing process and building a business plan and all of those things.
00:21:32
It's live. I would love to have you there. It's like my favorite thing to do. It's so much fun. gives me so much good, happy energy to come through and see light bulbs going off in your eyes as you learn how to run this business and create your own roadmap to launch your assisted living business. So, go check it out, roadmapchallenge.com. Don't forget to get the profitable assisted living facility book on Amazon. The ali.com is where you can go and I got the links on there for you as well.
00:21:58
So, go check that out. And if you haven't already, what are you doing? Like the video, subscribe, ring the bell as well so you get notified every time we put out content like this to help you launch your assisted living business. We go live on Tuesdays, put out content on Thursdays as well to help you make progress and launch your assisted living business. 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
00:22:19
entrepreneurs launch profitable, purpose-driven businesses, creating prosperity, purpose, and peace in their lives. I would love to help you out as well. Go check out the challenge, roadmapchallenge.com. 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 are going to be successful. Thanks for watching and have a great day.
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