Assisted Living Facility Break-Even Analysis: 29 Residents

Fixed costs $161.5K/mo Base payroll plus overhead

Contribution margin 83% After variable costs

Break-even revenue $194.6K/mo Monthly target

Break-even timing Month 13 First crossover

Break-even calculator

Use this calculator to test monthly revenue against direct costs and fixed overhead for an assisted living facility.

Lean Base Full

Monthly revenue Revenue is the cash coming in to cover direct costs and overhead. $ Lower sales Higher sales Variable expenses Use direct costs that move with occupancy, like food, care supplies, commissions, and ads. $ Lower costs Higher costs

Money available to cover fixed costs $292,505 $345,333 revenue - $52,828 variable expenses

Margin ratio

85%

Covers fixed costs

Yes

Fixed monthly costs This is the monthly overhead base that contribution margin has to cover. $ Lean base Heavier base

Break-even chart Revenue Total costs

Which assisted living expenses are fixed and which move with occupancy?

Cost classification

Break-even is only reliable if fixed monthly obligations are separated from costs that rise with census. In this model, Month 13 break-even depends on covering the building, core staff, and occupancy-linked care costs.

Expense	Cost	Break-Even Treatment	Common Mistake
Facility Lease or Mortgage	Fixed	Include $75,000 per month before any resident revenue.	Spreading it by occupied unit and hiding the true monthly hurdle.
Property Taxes	Fixed	Include $10,000 per month as a base facility obligation.	Treating taxes as tied to occupancy instead of property ownership.
Utilities	Semi-variable	Start with the $8,000 monthly baseline, then review usage as occupancy rises.	Modeling utilities as fully fixed when laundry, kitchen, and room use grow.
General Maintenance	Semi-fixed	Use the $4,000 monthly baseline, with step-ups when higher occupancy strains the building.	Assuming repairs rise smoothly with each new resident.
Facility Director	Fixed	Include $10,000 per month from Month 1 based on a $120,000 annual salary.	Moving leadership payroll into variable expense even though it exists before fill-up.
Caregiver	Semi-fixed	Staff in steps, rising from 6.0 FTE in the first year to 12.0 FTE by Year 5.	Treating all payroll as variable when minimum staffing exists before census fills.
Food Ingredients	Variable	Apply 7.0% of revenue in the first year, falling to 5.0% by Year 5.	Using one flat dollar amount even as resident meals and guest nights change.
Sales Commissions	Variable	Apply 4.0% of revenue in the first year, falling to 2.0% by Year 5.	Leaving commissions in fixed overhead and overstating contribution margin.

How does break-even change from a lean opening case to a full stabilized assisted living community?

Scenario table

Break-even moves with occupancy, pricing, and staffing. As revenue rises faster than variable costs, the cushion grows; if staffing ramps faster than residents, Year 1 can still stay under pressure.

Scenario figures are planning assumptions, not guarantees; actual break-even will move with occupancy, staffing mix, and resident care needs.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean opening case	$202,500	$34,425	$162,500	83.0%	$5,575	Near break-even, but Year 1 ramp timing can still turn profit negative.
Base ramp case	$345,333	$52,836	$173,750	84.7%	$118,747	Clear cushion; Month 13 break-even is already in range.
Full stabilized case	$568,750	$56,875	$198,333	90.0%	$313,542	Well above break-even, so the model has room for slower fill and higher labor.

What breaks the break-even plan for an assisted living facility?

Stress test

The base plan clears break-even, but the cushion is small. A 10% revenue dip, a 10% fixed-cost jump, or a 5-point margin drop can each push monthly cash flow back into the red.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$195,783	$5,575 cushion	Base margins are positive, but the buffer is thin.
Revenue shortfall	Monthly revenue falls 10% below Year 1 average.	$195,783	$11,233 gap	Slow admissions can wipe out the monthly cushion fast.
Fixed-cost pressure	Fixed overhead rises 10% to $178,750 a month.	$215,361	$10,675 gap	Staffing or overhead inflation pushes break-even up quickly.
Margin pressure	Contribution margin slips to 78%.	$208,333	$4,550 gap	Agency labor, food inflation, or insurance increases eat the cushion.
Combined pressure	Revenue falls 10%, fixed costs rise 10%, and margin slips to 78%.	$229,167	$36,595 gap	Lower census and cost pressure turn the plan cash negative fast.

Can you carry the lease and staffing before this assisted living facility reaches break-even?

Founder checklist

If you're about to sign the lease and hire, stop here first. This only works if you can carry the $75K lease, fund $1.035M of first-year capital spending, and survive the Month 12 cash low point; break-even lands in Month 13.

1Lease Carry$75K/mo

Verify the property payment can be carried before full census, because the lease alone is $75,000 a month and total fixed load is about $162,500.

2Resident Pipeline$195.8K/mo

Confirm your lead flow can support at least 29 residents, or about $195,800 a month, before you lock the opening date.

3Contribution Margin83%

Check that residency, care packages, and guest nights leave about 83% of revenue after food, supplies, commissions, and advertising.

4Staff Ramp13 FTE

Lock the opening roster at 13 FTE across care, kitchen, activities, maintenance, and admin, or payroll will outrun census.

5Cash Cushion-$117K

Fund past the Month 12 cash low point, because the model bottoms near -$117,000 before it turns positive in Month 13.

6Referral TestPre-open

Test referral sources before hiring ahead of census, because move-ins have to show up early enough to cover the ramp.