Do you want to know how much money assisted living facilities make? If YES, here is an analysis of the income potential of assisted living facility owners.
An assisted living facility is simply a residence designed for older adults who are still mobile but need help with one or more activities (bathing, eating, and so on).
This business is ideal for those who are interested in medicine, care giving, and generally improving the human condition. If you are especially compassionate toward the disabled and elderly, opening and operating an assisted living facility will prove to be quite rewarding.
Older adults offer an exciting opportunity for willing entrepreneurs, but the senior living industry is swelling to match the demands. The industry includes many forms of living options; retirement housing with minimal medical support to full-blown nursing homes.
How Much Money You Can Make Owning an Assisted Living Facility?
Starting this business can be is expensive, but the more you offer your residents, the more you can charge, but the more it costs you. What matters most in this business will be the location you choose. You will need to render your services in an area where seniors who might use your services are willing to spend $8 to $10K a month for an L – shaped room with kitchenette and closet, maybe an extra room with a door for an extra bedroom.
Medicare doesn’t pay for assisted living facilities; Medicaid pays but not so often. LTC insurance doesn’t like paying for assisted living facilities and relatively few seniors have it anyway. So, you need at least 80 percent of seniors in your facility’s area willing to pay what you need to make a month. Assisted living facilities make money by charging residents a fee for staying in the facility. This cost is applied on a monthly or annual basis.
In general, assisted living facilities can charge between $2,000 and $4,000 per resident per month. However, the exact cost depends on the location and the quality of the facility. Your profit level just like it was mentioned above will depend on the size of the facility as well as its amenities.
If you have a large facility with top-notch amenities and maintain full capacity, your profits have the potential to reach the six-figure mark or higher. If you build a true brand and open additional assisted living facilities at new locations, it is possible to make millions of dollars in profit. However, you can boost profitability by offering auxiliary services on-site.
It is possible to charge residents additional fees for optional niceties like cable TV packages, nuanced dining options, on-site entertainment events, specialized care, and so on. If your facility reaches full capacity, it might be possible to receive financial kick-backs for referring residents to other facilities with available space.
A state licensed assisted living facility manager will likely command a salary of between $35,000 and $75,000 or more. If you do not want to handle advertising efforts, a marketing director will be necessary. Have it in mind that you might have to pay such a professional between $40,000 and $70,000 per year.
Nursing staff will likely demand a salary in the range of $30,000 to $50,000. Administrative staff will cost between $10 and $15 per hour. Kitchen/food prep staff will cost between $10 and $12 per hour.
The cost of food and beverages hinges on quality. Expect to spend several thousand dollars per month on sustenance for your residents. Plan to spend at least $500 – $1,000 per month for these supplies and adjust your budget accordingly as you get a better gauge of your clientele’s needs and demands.
The best way to build this business and generate more profits is to please current residents. These customers will spread the word to fellow seniors. It also helps to market the assisted living facility in local newspapers, magazines, radio spots, and TV ads.
Do everything legally possible to get the facility’s name in the spotlight and customers will seek out more information. A strong web presence will also help. Though many seniors do not use the internet at a high frequency, their family members likely do.
Boost your website’s search engine optimization (SEO) and it will be that much easier for prospective customers to find your business on the first page or two of search engine results. Another way to attract customers is to offer a competitive price for a room at the facility.
Match or beat competitors’ prices and you will enjoy a steady stream of customers. Employ true medical professionals who would not dare abuse or neglect residents and your customer retention rate will be more than acceptable.