Is The Philippines A Good Place For Military Retirees?
I often tend to write too “long”, so let me cut right to the chase here. YES, in my opinion anyway.
I’m a retiree from both uniformed service in the USAF and civilian service for the USAF. I moved to the Philippines almost 11 years ago and most of my income is my US government pensions. So far life’s been very, very good to me and to my dual citizen (US-Philippines) wife.
Like anything else, YMMV, but just a day or two ago my wife received a query from a friend of heres, the Filipina wife of another retired US serviceman and I realized I hadn’t written on the subject in a long time.
OK, You’ve Had The Last Big “Grip and Grin” Picture Op and Now You’re Unemployed
- 0.1 OK, You’ve Had The Last Big “Grip and Grin” Picture Op and Now You’re Unemployed
- 0.2 The Common Option Is a Second Career
- 0.3 So Why Am I Not Still Working in my Second Career?
- 0.4 Fine Words, Dave, But I Don’t Make That Much Money … I Only Have One Pension
- 0.5 The Average Retiree is More Often an E-7 or an O-5
- 0.6 So We’ve Established Monthly Income Is Not An Issue.
- 0.7 Do I Need a Visa From The Philippine Government To Live There? Yes, But It’s Very Simple.
- 0.8 Taxes
- 0.9 Enough About Taxes, How Do You Handel Your Money and Banking?
- 0.10 Enough About Money, What About Mail?
- 0.11 Health Care
- 0.12 So, What Else Do You Need To Know?
- 1 Related Posts
- 2 Share this Article:
The majority of US military retirees are in their 40’s and have a pension which will allow one to live anywhere they want to, but in the USA their living standard will would normally be rather “sub-standard”, if they can make ends meet at all.
The Common Option Is a Second Career
In my experience the majority of military retirees I know have opted to seek employment on the US civilian economy.
Most often I have seen these guys and gals get jobs with Defense contractors. Often right in the city from whence they retired, or overseas in some of the “garden spots” of the world like Iraq, Afghanistan and such.
Sometimes they land quite high-paying jobs, and if that’s what works well for them, great, I wish them well.
But when I retired I had the opportunity for a job like this. Actually I even did work for a year as an independent contractor consultant with a local defense firm back in Colorado Springs. Many happy memories.
So Why Am I Not Still Working in my Second Career?
Well some of you may call this arrogance on my part, but I feel it’s simply facts. After running multi-million-dollar programs as a Program Manager with the USAF, shifting over to be “hired help” who was meant to sit in the corner and speak when spoken to just did not sit well with me.
Many of you reading this may have similar feelings. It’s nothing to be ashamed of, life is too short to spend 20 more years biting your tongue and wasting your talents. Again, each person makes their own choice and whatever choice they make is the “right one” for them, but not necessarily for everyone else. You CAN live the rest of your life the way you want to, not the way you HAVE to.
Fine Words, Dave, But I Don’t Make That Much Money … I Only Have One Pension
I hear you, brother. Let’s look at the big picture, though. You’re retired, you don’t have to work anywhere. And if you don’t choose to gat another job to make more money, why not consider living somewhere where what you have for life is enough?
The lowest pay grade anyone can normally retire at in 2017 would be an E-5. This would net about PhP 80,000 a month in the Philippines. That’s about double what the average successful college grad makes in a big Philippine city. Millions of Filipinos would give their right arm for a guaranteed monthly income like that.
More here on the cost of living, I want to stay on my man article track: Philippine Cost Of Living — Can I Live in the Philippines on $1300 a Month?
Bottom line is even a 20-year E-5 can retire on his/her pension alone and live modestly, but well in the Philippines in 2017.
The Average Retiree is More Often an E-7 or an O-5
On the order of $2250 or $4,000 something a month at 2017 rates. (Php 112,000 to Php 200,000 monthly).
Trust me, these are very good salaries for living here in the Philippines. Higher retired grades and longer time in service (I made all the estimates based on 20 years service) may well take home significantly more retired pay.
So We’ve Established Monthly Income Is Not An Issue.
What about “permission”. We, especially those of us who served in the military, know there are always rules and regulations governing everything we do. This will always be true, anywhere, but the hurdles to permission to live in the Philippines are very low.
Do I Have To Return To The USA To Keep My Citizenship? Absolutely not. A US citizen has the right to live wherever s/he wishes and you will never lose your US citizenship. Period.
Do I Need a Visa From The Philippine Government To Live There? Yes, But It’s Very Simple.
- If your spouse is a Filipino citizen s/he can sponsor you for a Philippine 13(a) Permanent Resident Visa. Costs few hundred bucks, and, and it’s good for life.
- If your spouse is a former Filipino, both of you can get a 13(g) Permanent Resident Visa, again, good for life for both of you.
- If your spouse is not a Filipino/former Filipino, or if you are single, as a military retiree you can get a “Courtesy SRRV” visa, also good for life, one time costs of about $1500 per person.
- Or You Can Live With No Visa, If Married ti a Filipino/former Filipino. I’ve been here going on 11 years a now and I have never had a visa. My Filipino wife and I travel outside the Philippine at least once per year, so I just get a “BalikBayan Privilege” stamp whenever we return to the Philippines, good for one year, absolutely free and takes less than a minute to get at the Immigration booth upon arrival.
- If you’re not sure, you can just come to the Philippines and live on a “Tourist Visa Waiver which you get free upon arrival and stay as long as three years, simply renewing the visa waiver stamp every 2 months or 6 months. Costs will average out to a couple buck a day, Easy Peasy.
In short, getting permission to live in the Philippines is simple.
When I was outlining this article in my mind I didn’t even think about putting taxes this high on my list, becuase I only think of them about one or two days a year. But a lot of people who contact me about living in the Philippines seem to be inordinately worried about how they would file their taxes if they were living here.
For your US Federal Income Tax, to set your mind at ease on that score, it’s easy. You just use TurboTax, TaxCut, TaxBack or any number of online preparation services … many offer a free option for simple returns, and you’re done. As to how much you have to pay, well that might hurt, in any country, but filing you US income taxes from the Philippines is easy and simple.
As a US citizen you MUST report all income … you get no direct tax break by moving overseas. But for those of you have earned income, say from an online business, you may be able to take advantage of a huge tax break, the Foreign Earned Income Exclusion … up to $100,800 fr you and the same for your spouse if s/he is also earning.
Sorry, pensions, military retirement, Social Security benefits and mist other US government income is NOT considered earned income. Consult a qualified tax advisor to be sure about your situation, but the actual filing is simple and very quick.
If you OWE taxes, you can just use a US credit card. If you are getting a refund, simple, the IRS will direct deposit in your US bank or credit union account (more on banking in the next section below).
For State income taxes. This will vary, of course, depending upon your state of US residence. A number of states do NOT have an income tax. Some, like South Dakota are easy to gain residency in. There is NO legal requirement that any US citizen be a legal resident of any state. If you do decide to remain a resident of a US state which taxes you, agin, the process is very simple, you just efile your state tax along with your Federal tax.
What about Philippine Income Tax? That’s one of the great advantages of retirement in the Philippines. The Philippines does NOT impose income tax on foreigners who earn income from outside the Philippines. As long as you are not working for a Philippine company, running a business in the Philippines or otherwise earning from Philippine sources you have no Philippine income tax liability.
Enough About Taxes, How Do You Handel Your Money and Banking?
As a baseline, you should maintain a US bank account or, better yet, a US federal Credit Union account. You can have all your retirement benefits direct deposited there, and then move money from your US account to the Philippines as needed. I’ve written about this technique a lot, see: When You Need Money Just Write Yourself A Check and related articles.
How do I pay bills I still have in the USA? The method for handling these is easy (if you have too many bills, I can’t help, LoL). Just use your credit union’s online bill pay service and you’re done. For random, one-off payments, like sending some money to a relative, my credit union (and many others) allows you to electronically write and mail a check to anyone in the USA, free.
How Do I Pay My Philippine Bills? I recommend everyone immediately open a Philippine bank account. Two, actually. A Philippine Peso account and a US dollar account. I pay all my Philippine bills (utilities, etc.) with my Philippine bank’s online bill pay service. For cash, I use an ATM card which draws on my Philippine Peso account.
You can also use a US-based ATM card to get pesos from a cash machine here. Many retired military get most of their cash needs that way, I recommend you read this article first, though, as I don’t like the idea:
Enough About Money, What About Mail?
Well regular mail service between the Philippine postal service (PhilPost) and the USPS (United States Postal Service) works, but in most of the Philippines home delivery of mail is slow (could be very slow) and problematical.
Luckily, as a US military retiree (not a vet who left service before retirement, sorry), you get a great bonus/privilege here in the Philippines. The Military Postal System and the US Embassy provide a free APO/FPO Military Post Office, and several dedicated RAO’s (Retired Affairs Offices) receive mail for retirees using an FPO box number just like you had when you were overseas on active duty. Works great and the cost is the same as using the MPS as an active duty member .. normally just regular US postage.
Only thing to plan ahead for is the fact you must get your mail yourself from the RAO you chose to join, or pay to have it delivered by a commercial Philippine courier service, and (pay attention here), you can NOT ship merchandise through this system so, sadly, no shopping at AAFES online, Walmart.com, etc. and having it shipped to your Philippine home.
More info on the military mail systems and many other aspects of living in the Philippines as a military retiree here:
Wow, I’m up to 2,000 words already and still so much to cover. I better start winding things up.
As a military retiree you are entitled to TRICARE medical coverage for life, A great benefit.
In the Philippines you will use TRICARE Standard Overseas, until you are 65 and then you automatically transfer to TRICARE For Life (TFL). No charge for either program.
I could write a book on the pros and cons of TRICARE in the Philippines, but fortunately others have, so I’ll just refer you to some sources on TRICARE in the Philippines:
Coverage with TRICARE or even just living overseas, by the way, exempts you of all requirements regarding Obama Care or whatever hoops you might have to go through if it gets modified into TrumpCare.
So, What Else Do You Need To Know?
Here’s a good starting place, a couple thousand words from a military retiree who knows about living in the Philippines becuase he’s been doing it more than two years now.
If everything rosy and great for military retirees in the Philippines? Hell no. Everything is not rsy and flowers and sunshibe always anywhere.
But is the Philippines a great alternative to the taxes and grinding job slavery of “working for the man” just to stay afloat in the USA? I certainly say it is.
Try it and then you tell me, Is The Philippines A Good Place For Military Retirees?