Living In The Philippines - Running Out of Money By Patrick McGrain
Imagine being broke in a foreign country. The Embassy won't help you with funds, you're down and out and unless you know someone that will help, you're in big trouble and hungry. Many expats move to the Philippines without the slightest idea of how much money they need. Sure it's cheap to live there, but you still MUST have money.
Many expats are lured to the Philippines because of the low cost to live in a tropical paradise. It is cheap to live in many areas of the Philippines, but know what you need and how much money is needed. Some expats below the retirement age go in hopes of making some kind of a living in a business scheme. Many expats have no back-up plan and many more have little funds to draw from in an emergency. These are the expats that are setting themselves up to fail. The only thing they can do is return to their home country and start all over again. A difficult task if you are approaching retirement with no job, no money and no home.
The Common Sense Approach. Before making the move to the Philippines go there for a few weeks on a vacation recon mission. Tour the area that you hope to make your new home. Will you live in a city or a rural province? Research housing cost. You must know what it will cost before making the move. What household items will you need to purchase and how much will it cost. Will you drive a car or use Taxi cabs and Jeepneys. Do you really need a car?
Starting a new business in the Philippines. If you are not a business minded person why do you think you can operate a business in a foreign country? If you are a business person and you will depend on income from starting a Philippine business to live in the Philippines, don't go. That is unless you have enough money to live on for at least one year. Even then, chance of a successful business in the Philippines is very low. As a foreigner you can only own 40% of a business in the Philippines. Many expats with good business minds and good business ideas have failed here. Jobs too are hard to come by and the Filipino wage is just $4.00 a day. The Philippines may well have more store clerks with four year college degrees than any other country. American companies operating in the Philippines will transfer current staff to the Philippines to any vacant positions. The Philippines is a highly desired location for these employees.
If you are already retired and have a monthly retirement income of approximately $1,000.00 you will be fine. Provided you budget your money. Make sure your health insurance plan will cover medical and medications cost in the Philippines. There are insurance companies that provide expat insurance, do your research. Philippine hospitals will not allow any medical services for you unless you pre pay in cash. You should always have at least $5,000.00 in the bank for any type of emergency and always have a plane ticket out of the country in case of an emergency.
This Simple little task of maintaining a monthly budget is too easily overlooked and that's a fatal mistake for any expat.
The first thing to do is STOP thinking in dollars and start thinking in PESOS. All too often I hear expats say, it's only a dollar. Big mistake as a dollar here and a dollar there adds up to a lot of Pesos. What many expats spend in just one day in the Philippines is what a Filipino family may spend for an entire month. Many Filipinos work six days a week and make just P200.00 a day or about $4.00 that's only $24.00 a week. You, as an American CAN'T live on that little bit of money.
Monthly BUDGET 2007
Living in a rural province is affordable. However, many rural provinces have only limited services. Husband and wife, Estimated 2007 Home Budget in a rural Camotes Islands province of Cebu. The budget doesn't include the visa costs.
Electric (Monthly Average) $45.00
TV Satellite $20.00
Cell Phone Cards (Monthly Ave Use) $10.00
Gas LPG (Monthly use) $8.00
Internet Connection $20.00
Motorcycle gas $12.00 two bikes
Motorcycle maintenance (oil, tires, etc) $8.00 two bikes
House Maint. repairs, etc $60.00
Food, includes bottled water $200.00
Medical Insurance (two people) $90.00
Daytime Maid $40.00
Monthly Total $523.00
If you decide to live in Cebu City you may need at least $1,000.00 per month and Manila will cost about $1,500.00. Clearly the rural provinces are less expensive, but offer only a limited lifestyle or as I call it a unique lifestyle.
Bottom line: Look before you leap. Take your time before moving to paradise and be sure you have a plan and a budget and stick to both, by doing this you will have a happy life in a truly wonderful paradise.
The Philippines is a beautiful place to live. I have lived in the very remote and rural Camotes Islands in Cebu, Philippines with my Filipina wife for more than three years. I have found my tropical paradise and I could not be happier. However, I have made financial mistakes while being here and it was difficult to overcome. I now consider myself very lucky to have overcome my mistakes . I now live a life that many can only dream about, but I paid a price to live my new lifestyle. I would urge anyone considering moving to the Philippines to use caution and common sense. If you don't have the money to support yourself for at least a year in the Philippines, wait until you do. Don't think that a little money will be enough; is it ever?
