Unlocking $30K/Month in Assisted Living: The Untold Truth

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Earning $30,000 a month from an assisted living facility might sound like a dream, but it's not as far-fetched as you might think. With the right plan and a solid grasp of your finances, you can reach this income goal. In this blog, we’ll dive into the numbers, what to focus on, and why understanding the financial side of assisted living is so important.

Check out the video, too:

Understanding the Numbers

Let’s start with the basics! To make $30,000 a month, you need to know where the money comes from. Imagine you have a 10-bed facility, and each resident pays $3,000 a month. That adds up to $30,000 in total income before any expenses.

If your rates are a bit higher, say $4,000 a month per resident (a mix of Medicaid and private pay), your total income could be $40,000 with 10 residents. And if you have a bigger facility with 15 or 16 beds, you could bring in $60,000 to $64,000 each month. Sounds great, right?

But there’s a catch—gross income (all the money you bring in) is different from net income (what’s left after you pay all the bills).

Gross Income vs. Net Income

A common mistake is confusing gross income with net income. Here’s a simple breakdown:

Gross Income: This is the total money you make before you pay for anything.
Net Income: This is what’s left after you cover your expenses.

For example, if you make $30,000 in gross income but have $25,000 in expenses (like staff salaries, food, and utilities), your net income is only $5,000. That’s why it’s crucial to keep track of both numbers!

Factors That Affect Your Profit

Here are a few key things that impact how much money you make:

1. Facility Size and Scale

Smaller facilities with 10-15 beds often serve residents on Medicaid and have lower gross income, but with smart spending, they can still be profitable. Larger facilities, with 50 or more beds, tend to attract private-pay residents who can afford higher rates, but they also have higher costs.

2. Payer Mix

Your income depends on who is paying. A good mix of Medicaid and private-pay residents can help balance things out. Medicaid is steady and reliable, but private pay tends to bring in more money per resident.

3. Cost Management

Expenses like staff pay, food, and electricity can go up and down. Surprise costs, like fixing a broken heater, can eat into your profits. That’s why budgeting and planning are so important.

Tools to Help You Succeed

To hit your $30,000-a-month goal, use tools to make your job easier. An underwriting calculator, for example, can help you figure out exactly how much money you’ll make after expenses. You can grab our free underwriting calculator to help you out with this.

Reaching $30,000 a Month

It is possible to earn $30,000 in net income every month, but it takes careful planning. You need to:

Keep Expenses Low: Watch your spending to make sure your costs don’t eat up your income.
Balance Revenue Sources: Aim for a mix of Medicaid and private-pay residents to keep your income steady.
Use Helpful Tools: Tools like underwriting calculators can give you a clear picture of your financial situation.

Ready To Take The Next Steps?

Interested in starting your own assisted living facility but unsure where to begin? Download our Business Plan Checklist for a step-by-step guide on creating a successful business plan. This resource is designed to help you navigate the complexities of starting and running your facility. Additionally, consider applying to the Assisted Living Investing Mastermind program. This comprehensive 12-month program is designed to guide you step-by-step toward owning and operating your own assisted living facility. With the added benefit of personalized coaching support, the program ensures you have the resources and guidance needed to succeed in this rewarding industry.

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