What is Senior Living? A Comprehensive Overview of Care Homes, Assisted Living, and Nursing Homes
Jul 08, 2025
Curious about the world of senior living? You’re in the right place! In this blog, we’ll break down the basics of care homes, assisted living, and nursing homes so you understand the key differences and know which one fits your goals or your loved one’s needs.
Check out this video, too:
Why It Matters:
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Not all senior living models are the same — they vary in care, cost, and business potential.
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Understanding the differences helps you make smarter choices as a caregiver, investor, or entrepreneur.
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Knowing the landscape helps you plan the right services, staffing, and licensing.
Let’s dive in!
What is Senior Living?
Senior living refers to different types of housing and care options for older adults. Here are the most common:
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Independent Living π‘ — For seniors who can live on their own but want community, amenities, and no home maintenance.
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Assisted Living β€οΈ — For seniors who need help with daily tasks like bathing, dressing, or medications but don’t need 24-hour medical care.
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Memory Care π§ — Specialized assisted living for seniors with Alzheimer’s or dementia.
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Skilled Nursing / Nursing Homes π₯ — For seniors who need 24/7 medical care, often short-term rehab or long-term care.
β‘ Action Tip: Define which type you want to operate or invest in — each comes with different licensing, staffing, and profit models.
Key Differences You Should Know
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Licensing: Assisted living and nursing homes require state licenses; independent living usually doesn’t.
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Staffing: Nursing homes require nurses; assisted living focuses on caregivers (with some part-time nursing support).
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Costs: Independent living is often private pay; assisted living can be private pay or Medicaid; nursing homes often rely on Medicaid or Medicare.
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Margins: Nursing homes often has higher margins than assisted living but also higher operational risk.
β‘ Action Tip: Check your state health department’s definitions and requirements before starting — every state is a little different!
Who is a Good Fit for Assisted Living?
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Seniors needing daily help but still social and mobile.
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Families looking for a more home-like setting (vs. a hospital feel).
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Entrepreneurs who want to enter the senior care space without the heavy medical licensing of a nursing home.
β‘ Action Tip: Download the FREE Business Plan Checklist to map out your ideal resident profile and services.
Next Steps: Take Action Today!
π Want to launch your assisted living business in the next 12 months?
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Step 1: Download the Business Plan Checklist to start planning.
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Step 2: Need help figuring out where to start? Join the next Roadmap Challenge and build your launch plan with me.
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Step 3: Follow this guide, take action, and bring your vision to life!
Got questions? Drop them in the comments below! β¬οΈ
Show full transcript π
Transcript
00:00:09 - 00:01:15
hey friend it's Brandon Gustafson with Assisted Living investing. net sorry for the delayed uh start there uh wasn't expecting that to already be on for me so uh thanks for joining me here uh today excited to to have you with me and to just kind of chat with you a little bit today we're going to be talking about the senior living industry what it is uh and kind of give you an overview of exactly what what the industry is and what it entails uh give you an overview of the industry a lot of people uh I
00:00:42 - 00:01:35
think confuse some of the terms in the industry so we're going to get into that before we get started though I want to make sure you get over to the website assisted Liv investing. net uh I'll have a link down below to get the free underwriting calculator as well uh so get over to Assisted Living investing. netal uh I've got it going across the bottom of the screen so you can can grab that whenever you need to um also here on the screen and we'll have it in the link below so just want to make sure you
00:01:08 - 00:02:10
know how to get that information uh so with that said let's get into the topic today of what is Senior Living what is the industry uh as a whole and how can you kind of get an understanding of what you're looking at as you look to invest in this um but also you know some of you might be users of the system and and need some help and guidance around just the different types of facilities and the different levels of care that exist so we're going to get into that in today's video just some background on me
00:01:39 - 00:02:34
an overview um I own and operate two assisted living facilities I live in Utah I have one of them in Idaho and one in Colorado in Colorado Springs and operate those remotely I've secured over one and a half million in SBA funding to purchase those facilities I've gone through this process I understand how to do it and can help you out through that process process as your coach if you get over to the website again I've got some coaching programs just scroll down and you'll see those and we're launching our
00:02:07 - 00:03:06
accelerator course I think in January so that will be really exciting so stay tuned um and get on the wait list for that I uh do this all out of state I have a masters in healthcare administration as well uh from the University of Utah and have worked in the healthcare industry for over a decade now and have a lot of experience with government programs and understanding uh how how things work in the healthcare industry and uh just I I I love working in healthcare one of the reasons I got into the industry is uh my passion for
00:02:37 - 00:03:28
helping people and that's what I bring to this and can kind of help you out through the process uh if you're passionate about helping people but you are not familiar with the healthcare industry I'm here to help you and guide you through that process now let's get into the different types of facilities uh there's actually a lot here and and a lot of these I think are going to be used interchangeably by a lot of people and and you're going to hear aist assed living um and a lot of them are talking
00:03:03 - 00:03:59
about residential assisted living or Care Homes but in in reality there's actually a few different levels of care here one is independent living and we're going to go a lot deeper into each of these so there's Independent Living there's Care Homes there's residential Assisted Living uh then there's assisted living facilities and there is a difference there between those two and then skilled nursing facilities or nursing homes so we're going to get into each of those and and what they are just give you a level of understanding so
00:03:31 - 00:04:34
that you know what you're getting into as as you get into the industry and you're interested in in investing here so we're going give give you an overview of this first is independent living so this is the lowest level of care and really in Most states you're actually not allowed to provide any care at all to residents of an independent living if you do you're actually in breach of the type of uh of facility that you're running and so you are are really just giving them a place place to live um and
00:04:01 - 00:05:04
a place to have some food um you can't even like do laundry and stuff you're providing them with all of these services or or the the ability to do some of these things you got a pantry you have washing and drying machines um but you're not able to actually help them once they start needing help with that then they need to move up to a higher level of care which would be assisted living there are so there's no extra Services is really just kind of a house or or an apartment building um that goes into this it is not the same
00:04:33 - 00:05:36
as like Section 8 housing um or some of those different housing um options but it there there I would say is some similarities there so if you're interested in learning about Independent Living comment independent living down below I'll see what I can do to get you some resources for that let's move over to Care Homes now care home is something I've got some videos coming out on the channel uh so make sure you stay tuned subscribe and like the stay tuned uh subscribe and ring the bell so you get
00:05:05 - 00:05:56
notified when those come out because I think I actually have one coming out this week so make sure you stick around for that uh I'm going to get into kind of care homes with two to three beds uh so it's going to be a really interesting uh conversation a lot of people are interested in that but a care home is usually going to be a Max of four to six residents and it's going to depend on your state but you're going to be capped at that there's going to be a few less regulations with the care home as
00:05:30 - 00:06:26
opposed to an assisted living or residential Assisted Living uh for example something that I've seen is in a care home you don't need a sprinkler system but in a residential assisted living facility you will a fire suppression system and and so that's a really big expense for you if you don't already have that it's going to be a big expense for you to put in but if you want to do a care home you may not have to do that again you want to check with the state check with the municipality fire department so you can kind of give
00:05:58 - 00:06:59
an understanding of what that's going to look like for you but it's going that that guidance is going to help you understand what you could do in your house so a lot of you watching this are interested in you have an extra home you have a single family home and you want to start something and you're like oh residential assisted living that sounds great uh but you're really confused at it if it's a smaller home three bed to Bath you're going to be better off doing a care home that's going to be the type
00:06:28 - 00:07:27
of level that you want do so when you're having conversations with the state when you're having conversations with the municipality you want to call it a care home you don't want to call it an assisted living facility because it is a it's a different license type it's a different level and if you are talking about doing Assisted Living then it may require some rezoning and it may require a different license type but if you go into this and you say I want to do a care home and I want I have three
00:06:58 - 00:07:55
bedrooms and I want to have three residents in there that's a very different conversation it's going to help you out through the process there okay so that's something you I want to make sure is clear to you as you get into this there is a difference between a care home and a residential assisted living facility a lot of people use those interchangeably and they're not they they're very similar you're providing the same level of care you're still providing them with care for those activities of daily living showering
00:07:26 - 00:08:29
dressing preparing food but it is at a different level a different type of license a different type of home even so something for you to just kind of be aware of as as you get into this and dig a little bit deeper some of the the nice things about a care home is again less regulations and your staff uh so your Staffing model is going to be a lot lower which is going to save you money on your expenses in the long run which is a nice thing Staffing is by far going to be your largest expense in assisted
00:07:58 - 00:08:57
living in this industry and when you're running this type of a business and so the the lower you can do on that the the better op you'll be where there's a little bit of a con there is you can have less res you're only allowed up to a certain amount of residents in a home and so your income is also going to be lower so you just need to do some underwriting if you get over to the website assisted excuse me Assisted Living investing. netal get on the ticker we'll have it down below you can get access to the calculator and kind of
00:08:27 - 00:09:29
go through the process of uh you know what would it look like and how does it work to uh to underwrite this if if I had three residents versus 10 residents and i' I've built that in a way that's going to help you out through the process so if you are interested in learning more about Care Homes care comment Care Home down below and I'll see what I can do to get you more resources on that one as well our next one is going to be a excuse me a residential assisted living and so this is you probably heard of them as a raw
00:08:58 - 00:10:09
or a Ral or an RC CF or an rcfe it depends on your state there if you have not been in healthcare um it is the world of acronyms and there are acronyms everywhere and that is not an exaggeration there are so many um I so my fulltime job I work for a health insurance company and do contract configuration for them and I I will look through I'm looking through my chat right now and I've got 10 acronyms on there so you're going to see acronyms all over the place in the healthcare industry um it is just there there's so
00:09:33 - 00:10:43
many of them don't get confused a a Ralph uh RCF rcfe those are they're the exact same thing okay so don't get too confused about it they are a higher level they're not a higher level of care they're a higher uh they're higher capacity license than a care home would be so you're going to be C at 16 to 20 beds depending on state where where you're operating uh for how many you have there it is still a home environment though it is residential assisted living for a reason that residential word on there is because
00:10:08 - 00:11:12
you're in this home setting typically what you want to see is like a ranch style or a rambler Style style home that is kind of single level living however my facility in Colorado has four stories to it it does limit us in our ability to bring in certain types of residents because if they can't do stairs they can't live in our home but uh you can have stairs in the home there there's no regulation against that you just need to make sure that your residents are capable of going in and um you know doing the stairs and handling
00:10:41 - 00:11:49
the stairs it but this residential assisted living it is still that home environment still is going to be in a neighborhood still look like a normal house um and and people wouldn't know unless you told them that it's an assisted living it is going to have more staff than a care home so you're going to have higher expenses as you get into this but you're also going to have higher income because you have more residents what I tell a lot of people is I would probably avoid having something that is less than
00:11:15 - 00:12:14
10 beds in this residential setting actually I'm going to I'm going to turn this off really quick um so I can talk right to you um so what I would tell you is if you want to do this residential Assisted Living doing something that is less than 10 beds is is going to be really hard now if you're doing a care home that is that is separate so where there's this kind of Gap is this area that's like between four and 10 residents in a home that is where there's this Gap where you're not bringing in a lot of income but you're
00:11:45 - 00:12:49
still going to have to have a staffing model that is that is heavy and and your margins start to get really really tight but if you have more than 10 or you're less than four you're going to be in these kind of sweet spots for what is going to make sense for you financially to run a care home or a residential assist of buing so this is the route that you want to go and you want to have a house and you want to convert that house and you want to run a facility out of it run a home out of it those that's
00:12:17 - 00:13:18
the the guideline I would give you four or less for a care home 10 or more for a residential facility okay so I I want to make sure that that is clear they people are going to use that interchangeably and they are different and those are some of the guidelines that I would give you if you are in that four to to 10 range you're it's going to be really tight unless you have a a super nice house and you're able to charge very high private pay rates if not you're going to have very slim margins so I
00:12:47 - 00:13:48
just want to be clear with you as as you're getting into this what that's going to look like okay let's get back over to the slides uh okay so that's residential assisted living now let's let's dive into assisted living and you might be thinking to yourself why does he have residential assisted living and assisted living on here and it is because they are a different license type again so you're going to have uh an an assisted living facility this is what when you're talking to somebody talking to your
00:13:18 - 00:14:21
neighbor and you tell them I'm really interested in investing in Assisted Living they're going to think oh that building that kind of looks like an apartment building or kind of looks like a hotel that that's what they're thinking in their mind this is that type of facility an assisted living facility is 20 plus beds it is more of a commercial style type of a home uh and they they just feel bigger and they feel a little more clinical and there's nothing wrong with it there is there is absolutely value in it and as an
00:13:49 - 00:14:55
investor I will tell you this they um are going to make you more money because you have more economies of scale and so if you're in this to make money then going with something larger is going to make more sense to you honestly it really will however if um and sorry my light just went out so I'm gonna plug my my light back in let's get that on there okay now if you are are more into uh wanting to to talk to or help people out and create kind of this home and family environment going the residential route
00:14:22 - 00:15:23
and a Care Home Route is going to be a better option for you so uh those are just some of the things that you want to be aware of as you get into this the difference between a residential assisted living and an assisted living facility um those are the differences as as you get into this you're starting to just kind of understand a little bit more about the industry um and like I said it's it's what you think about when you hear the term Assisted Living it's what everybody thinks about when when they see this um
00:14:52 - 00:15:54
and and so you're you're going to have more residents so you get more income you're going to have to have more staff but because you can have an exponential amount more of residents you're going to have higher margins as you go through the process and getting you um more cash flow coming in this is why it makes a little bit more sense for you to from a financial perspective may make more sense for you to do this type of a facility now let's move on to the next one which is skilled nursing or a nursing home and this is this is
00:15:24 - 00:16:22
actually a completely different type of a license so you have Independent Living which is a lower level care you can't do anything with them you got Care Homes residential assisted living and assisted living you have those three and they kind of are the same thing you are offering the same level of care to your residents it's a different setting but you're offering the same type of care there um now where this differs is you're getting to a higher level of care these are people that are closer to end
00:15:52 - 00:16:52
of life or they need more care because they were in a big accident or they had a surgery or something like that often times what you'll see in in skilled nursing is um people will need to go there as kind of like Rehabilitation um if they had surgery and they need extra help but they're working through that process they might have like a physical therapist coming to help them out through uh you know through their recovery and then once they get to a point where they're able to do things a little more independently they're going
00:16:22 - 00:17:25
to come down to the Assisted Living so skilled nursing and nursing homes are different from Assisted Living because they offer a higher level of care people often use nursing homes and assisted living interchangeably and they are different uh most people don't know what skilled nursing is it's basically a nursing home um but they will use a nursing home and an assisted living interchangeably when in reality they are different levels of care you're going to see with a a nursing home or skilled nursing they're going to typically be
00:16:54 - 00:17:55
that larger commercial style type of a facility um they do provide a higher level of care than what you would see in a care home or an assisted living and the nurses are playing a much larger role in the care of the residents whereas in an assisted living you might have a nurse that comes in uh once or twice a week and does assessments and and helps out with some Med management um whereas and then you get into a nursing home and you have nurses that are there full-time and they're helping out with a lot of the things because it
00:17:25 - 00:18:30
is a higher level of care so that's a huge difference there typically these people are also going to be closer to end of life and you might get a hospice a little more frequently in a nursing home but those are kind of the the different ones if you're interested in learning more about nursing homes or skilled nursing comment that down below and I'll I'll see what resources I can find for you there again these three things are all different types of licenses and they kind of give you some guidance around um they're going to be
00:17:57 - 00:19:00
at a different level of care they going to be a different type of license if you are are here live thanks for being live if you have any questions drop those down below so I can get to them um here live um and uh you know comment which of those three you're most interested in is it Independent Living is it Care Homes residential Assisted Living uh assisted living or nursing homes skilled nursing love to hear from you on which one is is most interesting to you and which one you're most interested in investing in
00:18:29 - 00:19:19
uh also I want to remind you to subscribe to the channel ring the bell so you get notified every time we go live we're doing these on Tuesdays uh going forward uh it was a little bit late today because of a conversation I was I ended up having about our facilities uh so later than I would like to be still wanted to get this out to you and kind of give you some coaching about the industry and what that looks like so make sure you subscribe and ring the bell so you get notified every time we go live and like the video and share
00:18:54 - 00:19:53
it so people understand a little bit more about the industry there's a lot of confusion the senior living industry as a whole and I want to make sure I'm educating people uh and helping them understand the the different pieces of of of the senior living industry does residential Assisted Living sound interesting to you but you don't know how to get started at Assisted Living investing. net we're here to help you through the process start to finish I want to thank you for watching and have a great day
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