In-Home Elderly Care Break-Even: About $60k Monthly Revenue

Fixed costs $42.4K/mo Year 1 base

Contribution margin 71% After variable costs

Break-even revenue $59.7K/mo Monthly target

Break-even timing Month 8 Cash turns positive

Break-even calculator

Test how monthly revenue, direct costs, and fixed overhead stack up against monthly break-even in home care.

Lean Base Full

Monthly revenue Revenue drives the cash left to cover fixed costs. $ Low revenue High revenue Variable expenses These rise with more client care and service hours. $ Lower direct cost Higher direct cost

Money available to cover fixed costs $36,300 $48,400 revenue - $12,100 variable expenses

Margin ratio

75%

Covers fixed costs

$3,567 short

Fixed monthly costs This is the monthly overhead the service must cover. $ Lower overhead Higher overhead

Break-even chart Revenue Total costs

Which elderly care expenses are fixed, and which move with client volume?

Cost classification

Break-even gets useful only when direct care expenses move with revenue and office overhead stays fixed. In the first operating year, the model reaches break-even in Month 8, so small classification errors can hide cash needs.

Expense	Cost	Break-Even Treatment	Common Mistake
Caregiver Wages & Benefits	Variable	Use 20.0% of revenue in the first year; this moves with billable care hours.	Treating direct caregiver labor like office payroll.
Caregiver Payroll Taxes & Insurance	Variable	Use 5.0% of revenue in the first year; include it in direct service margin.	Leaving employer burden out of gross margin.
Client Onboarding & Assessment Materials	Variable	Use 2.0% of revenue in the first year; intake work rises with new clients.	Ignoring assessment time and materials in pricing.
Caregiver Ongoing Training & Supplies	Variable	Use 2.0% of revenue in the first year; supplies and refresher training scale with service volume.	Underpricing the ongoing training load.
Office Rent	Fixed	Use $2,500 per month from Month 1 through Month 60.	Scaling office space before client volume supports it.
Software Subscriptions	Semi-fixed	Use the $800 monthly base, then review capacity as scheduling volume and users grow.	Missing step-ups tied to users or scheduling load.
Administrative and Management Salaries	Semi-fixed	Use $34,167 per month in the first year; add staff in steps as client volume grows.	Hiring ahead of active client demand.
Marketing Budget	Semi-variable	Use $2,500 per month in the first year, checked against $500 customer acquisition cost.	Spending without tracking acquisition cost by channel.

How does break-even change across lean, base, and full home care formats?

Scenario table

Lean is closest to break-even, base adds a little room, and full has the best cushion. The contribution margin rises with the higher-priced mix, but fixed overhead also rises, so staffing and sales control still matter.

Planning assumptions only; actual break-even will move with staffing, client mix, and local wage pressure.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean home care mix	$60,030	$17,409	$39,867	71.0%	$2,755	Near break-even; a small dip in hours would hurt.
Base home care mix	$89,355	$24,474	$56,950	72.6%	$7,931	Modest cushion, but overhead growth can still erase it.
Full home care mix	$112,860	$29,118	$67,575	74.2%	$16,167	Best cushion, yet admin and marketing still set a high bar.

What breaks the break-even plan for in-home elderly care?

Stress test

The plan is most exposed to low billable hours and labor creep. With 71% contribution margin and $424k of fixed costs, CAC above $500, overtime, underused admin staff, or extra travel costs can push break-even up fast.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change.	$597,000	$0 cushion	The base case clears break-even, but there is little slack.
Revenue shortfall	Revenue runs 10% below plan.	$664,000	$67,000 gap	Slow billable hours or CAC above $500 can move the line fast.
Fixed-cost increase	Fixed overhead rises by $10,000.	$611,000	$14,000 gap	Every extra $10,000 of overhead adds about $14,000 to break-even revenue.
Margin pressure	Travel reimbursement adds 1% of revenue.	$606,000	$9,000 gap	Direct caregiver wages and payroll taxes already take 25% of revenue before onboarding and training.
Combined pressure	Revenue runs 10% below plan, fixed overhead rises by $10,000, and travel reimbursement adds 1% of revenue.	$689,000	$92,000 gap	When demand, labor, and overhead miss together, break-even climbs sharply.

What should you verify before hiring ahead of break-even?

Founder checklist

Don’t hire ahead of demand. The model is ready when an active client really brings in about $2,070 a month, CAC stays near $500 on the $30,000 marketing budget, and you can carry Month 8 with $784,000 of cash.

1Revenue mix$2,070/mo

Verify the Year 1 service mix really produces about $2,070 in monthly revenue per active client before you count on scale.

2Billable load40 hrs

Confirm each active client can absorb 40 billable hours per month in Year 1, because that load is what supports the pricing plan.

3Contribution71%

Keep direct caregiver wages, payroll taxes, onboarding, training, and supplies at 29% of revenue so 71% is left to cover overhead.

4Fixed load$39.9K/mo

Hold monthly fixed overhead near the model run rate of about $39.9K, or break-even slips while volume catches up.

5Caregiver benchPre-launch

Build background checks, intake forms, care plans, scheduling, and billing before you sell more hours, so capacity grows with demand.

6Cash runway$784K

Plan cash through Month 8, because the minimum cash need is $784,000 and the model does not break even until Month 8.