Lotus_in_Sampalok_LakeA great man once said, "Be a lotus." Which means, no matter how ugly, how evil, and how sinful everyone around you might become, do not allow yourself to be stained.  A lotus remains beautiful even as it lingers in the filthy waters of the pond.  Don't be contaminated, do not be influenced by worthless means, remain radiant among the shadows of darkness.  Be a lotus.  It has to start with one, to fill the pond with more.
Retire in the Philippines for less than US$1500 a Month PDF Print E-mail
Tourist Info - Things To Do
Wednesday, 26 November 2008 15:52
This article is intended for couples with no children under their expense, and with a paid-up health insurance coverage.  Children, particularly those still in school, can easily skew the cost estimates.  Health insurance also plays a very big role in the financial freedom of a couple on a limited budget.

The current (November 2008) exchange rate is almost Php50:US$1, it was at Php43:US$1 a few months ago.  Prices jack up during Christmas season so for purposes of easy computation, let's assume an exhange rate of Php45:US$1.  If the exchange rate moves beyond Php50:US1, you'll actually be able to get more pesos and therefore buy even more when you move here.

The cost of living in the Philippines is considerably cheaper than in most major American and/or European cities.  The combined monthly take-home salary of a newly married couple who are both working in the central business district of Makati after taxes and social security is normally around Php35k or US$780 only.  If they can live on that, so can you.

Let's list down your monthly recurring basic expenses and see how it fits in with the budget.

Item Description Php US$
Housing I'd put down Php10k for your average 40 square meter 2 bedroom 1 bathroom apartment.  It's probably twice that if you get a semi-furnished house.  Sure there are plenty of beautiful houses available at more than 10 times that, but do you really need your 5 bedroom 3 bathroom house with pool?  I'd recommend renting because you'll probably want to transfer cities every now and then.  Each city has it's own sights, culture and cullinary specialties.  Come to think of it, you might even want to move every few months -- nothing beats Cebu for the string of festivals in January, stay in the beaches of Boracay from February to May, move to Dumaguete from June to October for non-stop world-class scuba diving with their great weather even during the rainy season, then chill in the mountains of Baguio/Sagada for November and December. 10,000 222
Water/Power Php3000 takes care of your basic A/C, microwave, fridge, TV, DVD player (everybody has one), fans, lights, computer. 2,500 56
Cable TV There's a cabe TV company that uses satellite dishes for those in the mountains and other far flung areas, but most cities have cable TV companies under Php900 a month. 1,000 22
Internet Phone companies are now bundling DSL with their landline services for under Php1000 a month. 1,000 22
Mobile Phones You'll each need a mobile phone in the Philipines, after all, we're the SMS capital of the world!  One phone company offers Php5 (US$0.09) per minute calls to the USA, Canada, Australia, etc. 1,000 22
Food For comparison purposes, a McDonalds Quarter Pounder meal costs around Php100.  If each of you ate this 3 times a day for 30 days, that would be Php18k.  There's a wide variety of food choices here, lots of  "karinderias" or your mom-and-pop restaurants, small dinners, and home-cooking will stretch your budget even more. 18,000 400
Maid You'll want a maid to cook, clean the house, wash the clothes, and even go to market for you.  Here's an idea, if you want Italian cuisine, send the maid to an Italian cooking school! This might set you back Php20k, but I'm thinking it just might be worth it, plus you get to help the maid upgrade her skills for her personal growth.  You don't want them getting too tired for that kind of salary?  Hire 2 so they can watch their favorite soaps together. 2,500 56
Sundry Every house has unexpected expenses, new drapes, repair a leaky faucet, paint the fence, buy a new plant.  Let's set Php4k for those small items. 4,000 88
TOTAL 40,000 888

If we're working with Php67500 (US$1500), there's still Php27000 (US$600) left over for travel, clothes, entertainment, and other vices.

As retirees, you'll probably want to live in a city that has good hospitals, nice climate, good weather, and with many things to do and places to visit.  Most major cities have them - Manila, Cebu, Davao, Dumaguete, Iloilo, Cagayan De Oro, San Pablo City, etc.  Since the Philippines is like a chain of islands standing up from north to south, the northern areas get a bit hotter than the southern areas.  My personal opinion is the southern areas gets more rainfall than the north, but they also get hit by typhoons less often.  There's also more diversity in terms of fruits and vegetables down south.  If you like scuba diving, the famed center of bio-diversity which is just off the Batangas area is 3 hours from Manila and 2 hours from San Pablo City.  If you like mountain ranges, Benguet and the Ifugao regions are north of Manila.  If you like lazy afternoons beside fresh water lakes, San Pablo City boasts of having 7 crater lakes fed by fresh mountain springs.  Travelling to the islands is getting cheaper lately, a budget airline regularly offers promos for Php1500 all-in round-trip tickets per head to any major local airport.

The Philippines has 7,100 islands.  If you visited one island per day, you'd need more than 19 years to go to each one.  I don't know much about boats but it sounds like the right kind of transportation for being here.  Most locals don't own boats, strangely enough, except for those whose livelihood depends on the sea.

With so much to see and so many places to go, you'll probably want a car.  A compact SUV sells for Php1.4mil (US$31k), the Honda Civic is at Php800k (US$18k), a compact car sells for Php500k (US$11k).  If you'd rather not put down major cash for a brand new vehicle, there's a very big market for used vehicles and even for used spare parts(!)  After all, mechanics around here don't normally charge for an arm and a leg like in the states.

The minimum daily wage is less than Php500 (US$11), it's not too expensive to get an extra pair of hands when you need help with your garden, trimming trees, cleaning up after a storm.  Similarly, people who do plumbing, carpentry, car painting and repair, dress making and clothes repair, among others, also do not charge for too much.

I'm not encouraging, nor condoning, the use of fake products but there's a whole lot of knock-offs in the Philippines.  Gucci, DKNY, Prada, Vuitton, Sanrio, Levi's, Rolex, Omega, Cartier, even Nokia and Sony, are being copied, mostly not very well but sometimes good enough.  These are constantly found in flea markets that are just about everywhere.  Pirated material like DVD movies and music CDs are also widely available.  These are often sold beside software pirates selling the latest software like Microsoft Windows, Adobe products, and games!

It has to be said, even if briefly, that the Philippines is one of the most literate countries in Asia and English is taught as part of the school curriculum.  It's no wonder that so many call center companies are setting up their businesses here.  We speak English without any accent, usually with good diction and  proper grammar.  Even kids as young as 8 or 12 can sometimes carry on a decent conversation with an English speaking tourist.

Here's a little tip that I'm not supposed to publish.  If you're receiving your pension from the government and you tell them you're moving out of your country and into the Philippines, there's a good chance that the amount of your monthly pension will go down because of the comparative reduction in the cost of living here.  I think I read somewhere (so that nobody gets blamed) that you're supposed to have your pension cheque deposited directly to a bank account in the US, then you use your CitiBank creditcard here and your monthly charges are auto-debitted from your bank.  Don't ask me about the legallity of this, ask your bank and/or CitiBank instead.

Before I wrap this up, I must reiterate that if you're considering retirement in the Philippines, please make sure that the health insurance you're paying for there will be honored outside of your home country.  We have world-class hospitals here, people from Guam even come here for medical procedures, but some insurance companies are just not accreditted here yet.
Last Updated on Thursday, 27 November 2008 10:59