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SHOW NOTES FOR EPISODE 041 WITH GENE GUARINO – INVESTING IN ASSISTED LIVING FACILITIES
According to the US Census bureau, 77 million people will be turning 65 over the next 19 years. This means that EVERY DAY 10,000 people turn 65 years of age. 4,000 people a day will be turning 85. Many of these people will need assisted living and this could be an area where you can serve a big need and generate cash flow at the same time.
In this episode, Gene Guarino, president of the Residential Assisted Living Academy and a developer, manager and investor in assisted living facilities, discusses how the baby boomer generation has created a great need that savvy real estate investors can both capitalize upon and help people at the same time.
What You Will Learn
- How the Baby Boomer Generation is one of the largest population bubbles and how there will be a shortgae of residential assisted living facilities more and more as baby boomers reach 80 plus years of age
- What exactly Residential Assisted Living is and how you can convert a single family home that was making $1,000 a month in rent into a RAL facility that can NET more than $10,000 per month
- How RALs are not generally regulated nor do they require special licensing or permits
- How hiring a manager can reduce investor involvement to just 5-10 hours per week
- Where to find free resources to educate you on RALs as an investment
About Our Guest
Gene Guarino
Gene is a CFP, Certified Financial Planner in the US and is licensed in Australia. He is the President of the Residential Assisted Living Academy and currently owns and operates Residential Assisted Living (RAL) Homes in Phoenix and Scottsdale Arizona. Gene has been a real estate investor for over 30 years. He has owned and operated 16 businesses and has been an angel investor in numerous others. Gene has written 4 books, hosted 2 radio shows and has spoken to over 250,000 people in 4 countries over the past 20+ years on business and investing.
More About Gene
- First heard of RAL over 15 years ago as a great opportunity
- No one to teach him
- When his mother needed help, he could see there was a need and he decided to devote his time to learning and perfecting RALs to meet this need
- “Silver Tsunami” – term to describe the wave of baby boomers
Definition of Residential Assisted Living
- Group home (single family residence) for seniors in a residential setting
- 6-12 seniors living there with 24-hour care givers
- Homes are retrofitted
- make adjustments/ramps if steps or change of levels
- smooth floors
- wide open “spa” shower with a seat so residents can have assistance
- Average age of residents: 80-85
- People who need help with ADLs (activities of daily living) – taking medication, shower, bathing, feeding, finances
- RAL is not right for those who need medical help, they would need to move into an environment where skilled nuring or a nursing home
- Lite dementia or Alzheimer is OK but if it gets more severe, they may need to get into a specialized care facility
What’s Required for Those Who are Interested in Pursuing RALs as an Investment
- Anyone can do it – there are no specific requirements
- It doesn’t take a large investment
- Can buy just the business, just the real estate or both
- Can hire managers take care of the daily operations, staff supervision and management
- Insurance required – not malpractice, just liability (less than a $1 a day per resident)
- Residents pay, on average, $3,600 per month to stay at the RAL facility
- With 10 residents – $36,000 per month in gross income.
- After expenses, you will net over $10,000 per month
- You can just buy the business ($100-200,000 on average) or can also own the real estate
- We’ll all be involved in RALs one way or another — as a resident, writing a check for family to stay there or as an investor
- Number of residents per home is limited by states — in Arizona (10), Texas (16), Washington (6), Florida (unlimited), California (called RCFE and board and care facilities — 6 or more if you meet certain codes)
Staffing
- Care Givers in this industry love what they do
- You want to hire people who are well qualified, has experience but also has the right heart
- States also dictate what is required – Texas no requirements, Arizona requires 10o plus hours of training
Biggest Mistake
- First facility he bought both the business and real estate
- He had non-English-speaking care givers
- Care givers must understand and special the language of the residents to understand their needs
Biggest Success
- Getting started – He took action
- He wasn’t afraid to make mistakes
- He now owns multiple facilities and helps others to do the same
Advice for People Interested in Doing This
- You can be a passive investor – can invest money in the business
- Or spend 5-10 hours per week overseeing the operations and hire onsite manager
- Overseeing includes collections, banking, paying bills
- You can buy a RCF first as an investment and could live there in the later season of your life — instead of paying $2-8,000 a year for long term care insurance, move into your own facility when you need it
- He teaches people to get three homes and benefit from size and can share certain staff jobs
How to get started
- His website provides:
- Free Webinars
- Free Reports
- People can register for 3-Day Training in Arizona, tour his facilities or do home study
Rap-it-Up
- Favorite real estate book: How I Turned $1,000 in $5 Million in Real Estate in My Free Time by William Nickerson
- Favorite business book: The One Thing by Gary Keller and Beyond Half-Time by Bob Buford
- Favorite website: genworth.com/costofcare
- Favorite app: TrackMyDrive
- If you lost everything and only had $1,000, how would you start again: Make a list of the 5-10 most influential people people he knows and take them out to lunch, explain what he is doing and ask them to get involved with him.
How to Reach Gene
- ralacademy.com
- 480-704-3065
Get Gene’s Freebies
- To get his special research report: support@ralacademy.com.
- Links to webinars: https://ralacademy.wpengine.com/user-courses/
Until our next podcast, keep moving forward and God bless!
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6 comments. Leave new
Love the wrap up and the show notes. Well done!
Gene
It’s easy when you have a great guest! Thanks for the great information, Gene!
Very informative and useful info about assisted living. My aunt is in the business of assisted living / senior care since last 9 years. She has a great experience in this field. You also explained the assisted living nicely. I’m also interested in this business. By profession I’m a nurse.
This podcast has changed my life. I had never even considered Residential Assisted Living before I heard this podcast. It blew my mind and made so much sense. I listened to the podcast in early Dec. 2106, I went to Gene’s training in PHX at the end of Jan. 2017 and I am about to close on my first house at the end of March that will be my first home!
Greg, This is really exciting! Please keep us updated as you pursue your new venture. Best, Bill
Gene; I just came upon your website. I own “At Your Service, Assistance in Daily Living Cabins” here in Canton, Texas. I currently have 2 residents and possible the third soon. In Texas to be a group home there has to be 3 or less to not be state regulated. However, my hopes are to grow after my first year and become state registered. My area of concern is financial. You spoke truth when you stated in your documentation that one could earn up to 10,000 mth. My current with two is $6,200.00. The Second and Third cabins are not completed yet as well my sidewalks. How would I seek an investor with a return of 30% on investment for eight months or 40% for six months, or other incentives for the return investment. Honestly, I’m out of working capital and I can hold off but truly to provide what I want to give these tenants is exceptional at cost to me and my household. My mission statement is to provide Honor, Respect and Happiness in the latter days of the elderly and Honor, Respect and fulfilled life to the disabled. The video’s of current tenants speak for them self. One family member committed and said “We have not seen ——- that happy and move that much in a long time. My wife says you must be a miracle worker”. Our response – Not Us, But God.
If you could advise me on seeking investor and how I go about finding a good match for my project, please advise. I appreciate your site and good info. Thank you!
Penni Hutcherson
prhnea2017@gmail.com