Happy New Year 2010 to all my readers new and old. This post is updated today, 27 December, 2009. I really don’t see the need to change any figures right now on the attached spreadsheet breakdown, as virtually everything there appears to still be correct within pennies. I’ll update again at intervals as I feel are needed, so you can always get a relatively up-to-date snapshot. I’ll also a couple items that have changed a bit in the paragraphs below.
If this is your first time reading this, I encourage you to read the whole article, because I spend a little time there explaining why accurate, up-to-date costs may not be all they seem to be.
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Courtesy Yugatech.com, a really useful source of info in the high-tech world here in the Philippines. If you follow yuga, and you are from the USA, be prepared to learn that tech items in the Philippines are along way from what your concept of a “third-world” country may be….
Let’s look at how much a 1Mbps to 3Mbps residential DSL costs nowadays:
PLDT myDSL 2Mbps: Php1,995 (DSL only)
Globe Broadband 2Mbps: Php1,995 (DSL w/ free Landline)
Bayan DSL 1.5Mbps: Php1,699
Sky Broadband 2Mbps: Php1,999
From the list above, we can see that all of the current DSL offerings that’s “up to 2.0Mbps” have prices ranging from Php1,699 to Php1,999. That should give us what’s the current market prices that’s acceptable to broadband consumers.
Now let’s look at a rundown of unlimited mobile 3G by the networks and see if the prices are cheaper or not:
Sun Wireless Broadband 2Mbps – Php799
SmartBro Plug-It 2Mbps – Php999
Globe Tattoo 2Mbps – Php1,200
It’s pretty obvious now — 3G internet is now way cheaper than DSL. Remember when unlimited 3G used to be Php3,000 per month? That’s a price cut of 60% in 2 years. It doesn’t even consider the fact that 3G speeds used to be 384Kbps. I’d say 3G internet has become 92% cheaper if we take speed and price considerations into account.
Even at current rates, a 2Mbps unlimited 3G subscription is 60% cheaper than an unlimited 2Mbps DSL line. The only reason why people still think it’s expensive is that they don’t use 3G internet as much as they do with DSL.
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In addition to the ever popular “Jobs For Foreigners, Philippines” search term, a great many of my queries here in the website, and in my mail box involve the “Cost of Living, Philippines”.
I write about this often, and even publish pretty complete personal cost data for living in the Philippines.
Philippine Cost of Living Questions
But as we say on the Internet, YMMV (Your Mileage May Vary). One of the most difficult questions I get involves something like “How much for a modest lifestyle”, or “Can I live in the Philippines on Social Security”.
The answers are not difficult at all in actual financial or numerical terms, but they are very difficult in what I might suggest are “difference between you and I” terms. A “modest lifestyle” as I conceive it might translate into something totally different in how you may conceive it … and neither of us would be right or wrong.
I know of no way to reconcile this issue. People are different, (thank God) and I guarantee you, even if I exchanged homes with you for say a year, the amount you would spend over time living here in my home, and the amount I would spend if I were living back there wherever you are today, would differ significantly. I can say this, with a certainty. My wife and I spend a heck of a lot less here in the Philippines than we spent for a modest life style in Colorado, USA. But we could also spend a lot more, if we chose to.
I think my dear wife, the Unofficial Cook, said it best when we were discussing this the other day. “We have more options here.”
Now one point of actual comparison I do like is something I have written about here before … the “Big Mac Index”.
Before you tell me “I don’t like McDonald’s” or “I’m a vegan” or all the other manifold and myriad reasons this index is flawed, let me tell you why it has value and why The Economist, perhaps the most useful and prestigious international magazine of finance (highly recommended, by the way) has bothered to compile data and run these features for more than 24 years now … they mean something.
There are very few products sold in so many countries so much alike as the ubiquitous Big Mac. Even if you never buy one, knowing what a Big Mac costs in any country gives you a very useful snap shot of day-to-day costs in that country, without getting a headache or having to pull out an economics textbook.
If you look at the chart here, you can clearly see that in the Philippines a US dollar will buy close to 60% more “Big Mac” than it would in the USA … or, conversely, that the cost of living on Big Mac’s alone here in the Philippines is roughly 40% of living exclusively on Big Mac’s in the USA. I don’t recommend such a diet, but if you needed to, you certainly could buy a lot more here in the Philippines.
Now, regarding that other difficult question … “Can I Live on Social Security in the Philippines”? I think the best answer is, “If You Can Live On Your Social Security, You Can Do So in the Philippines”.
There are many programs under US Social Security, and may variables in each program …(some don’t work overseas, also, so be advised to use www.ssa.gov rather than a lot of on-line pundits, like me, to base your decision on). Your case is different from mine and ours together are certainly different from Freddie’s down the street.
Just the simplest form of Social Security income … your retirement benefit … can vary from under $310 USD a month (oh yes, they do go that low, mine is) to over $2300 USD a month. So can you live on your Social Security income? I can’t tell you … I can tell you the cost of things, you have to tell me if you can live on yours in the Philippines.
One of the things that will prove very different to you here is, there is a much broader spread between what you may chose to spend each month and what you have to pay each month, just to “keep the lights turned on” in a typical US home. personally, I enjoy the flexibility which I didn’t feel I had back in the USA.
Popularity: 36% [?]
Hi Dave;
Prior to Big Mac’s I used to use the price of an 8oz bottle of Coke to gauge the local economy, but the Big Mac is a much better way to go. Back to social security, here is a tad bit I didn’t know until it was too late. I retired at 54 years old, and waited 8 more years for the SS to kick in. While working as a Mariner, every year I receive a statement from SSA telling me I would receive big bucks upon retirement at 62, and more if I waited until I was 65 (or is it 66 now?), What they failed to tell me, even though I was paid up in full on my credits, that I would lose money every year I did not work. (8 years) which cut my SS to 66% of what I would have got if still working until retirement. Oh well I got less (around $1,200.00 per month), it still beats working.
I’m going to take a guess as to why yours is around $300.00. CRS maybe, I was stuck with FERS (what a rip off) and just lump summed it when I retired from my 2nd job with Uncle Sam. I invested the lot, and have done well.
Yet since for the last 8 years I’d learned to live well on just my Navy retirement, the rest is just gravy to me, and my bank book loves it.
Yes one can retire well on his/her pension in the Philippines, with some seed money to get started, and learning to live a simple yet comfortable life. And a Big Mac every week, is good too!
Yes. I lose most of my Social Security to Pension Offset from my CSRS federal retirement. The only social security income I had for some years was the USAF reserve.
And yes, those zero years of income really, really cut into Social Security payments. I had so many of them that when the technician at the Embassy was processing my retirement claim, they called him back and told him he had made a mistake .. it was like a police investigation, “account for how you lived on zero income for years so and so and such and such”.
I know lot of younger people on-line who have all kinds of schemes for hiding their income from Social security/Self employment tax. Fine with me, but they may rue the day when they are 66, or when they die and their children have no income except SS and they see how little Social Security can be, if you don’t pay into it.
Many say to me, “Oh don’t be an old fuddy-duddy. By the time I reach Social security age, the system will be broke.”
Well, maybe so, but they were saying the same thing, with a vengeance, 50 years ago, and yet today Social Security is a huge component of most people’s retirement plan. Personally, I wouldn’t want to ‘bet’ on its demise …it just may be the life line that keeps them out of the soup kitchen in 40 years.
Excellent article on the cost of living in the Philippines. This is the first time I heard of the Big Mac gauge of comparing the real cost of living. In our case both my SS and My wife SS plus other savings, is more than enough to lend us a very, very comfortable life in the province of Marinduque. Since we had built a retirement home, there is no more expense for mortgage, but instead taxes. The abundance of fresh seafood, meat , vegetables, fruits and fish here in Marinduque, help in the budget for food. Electricity and gasoline ( we have a car) is the big part in our monthly expense. Of course we have a maid, a driver and two gardeners. This could be an option not to have if you want to save. .
Thank you, David, as always for valuable and timely input. One thing I think I am going to have to mention in a future article is, it is not a case of which the average foreigner or balikbayan Filipino family _can_ live on a modest by Western standard income .. Social Security retirement benefits being a good example, but more a question of if they _will_ live on that amount.
I have to say that I noticed my wife and I are spending more in the past few months … becuase we want to rather than have to … and every family is going to have to deal with that. A good example I wrote about recently … my eyes. I could certainly have lived without my operation … but I didn’t _chose_ to … and that was well over amonth’s normal expenditures right in that one purchase.
Another example would be household helpers. Certainly you don’t _need_ them, but on the other hand, you worked all your life for this time, so why not have them (while suppling honest employment to those who otherwise might go without). It’s well within most expat family’s means … but their “means” had bettr be more thna numbers like the $700 USD per month that has been bandied about here and elsewhere.
Hi Again;
Cost of living, is less important that cost of lifestyle. If you can adjust your lifestyle to what you can afford, than you can live anywhere on any amount.
In the late 80’s I met a guy living in the Caribbean on a small island near Tortuga, he lived on a 16 foot covered rowboat with a 10 HP kicker motor. He was young, living on a small disability pension. (Approx. $400.00 per month) He had adjusted his lifestyle to what he had. I envied him, as he was living in paradise and not worried about the cost of living.
BTW you never commented on my comment from last October above? Buket?
Fully agree, Paul. Oh, what comment was that, let me look. I may owe you a subscription refund
That is by far the biggest advantage to me as far as living here. Not the costs in isolation, but the fact I can live so much cheaper if I chose to. My sister-in-law was just visiting and she gave me a run down on their expenses in a northern US state. The fuel and other utility costs, the ridiculously expensive car insurance (I just paid my full coverage/all risk car insurance for 2010, P12,400 pesos, I think she and her husband pay that per month for their two cars… 6 times what I pay. The insane cell pone bills and so on.
My BIL alone has been paying more than $600 a year for dental insurance that doesn’t provide full coverage .. 80% or so. I don’t spend $600 in three years on my mouth .. in the US you can only cut back to a certain point, and here that point is way, way, way lower.
Dave
Now thats the exact stuff I am talking about..
No matter how much you cut back here in the US you still have certain expenses that can NEVER be cut and will never go down.
That is what I I try to hammer into the minds of my relatives that say I am friggin crazy to be planning to retire in the RP, they just don’t get it.
Yep. And as I notice Paul has already said … it’s a sad fact that perhaps they never will .get. it. One of the hardest things about retiring to the Philippines is sometimes friends and family. They often are very negative toward the idea, and many a person who might have been happy here never even tries it becuase the hassle with relations at home overcomes the desire.
Neal;
You are so right, and they never will get it. My four brothers north of you in Mass. Have never understood my lifestyle, as I don’t fit into their box. 21 years in the Navy, Nightclub owner in Puerto Rico, and 10 years as a Merchant Seaman, and now living in the Philippines retired by age 54 (62 now). Maybe I should have stayed in New England, underemployed, underpaid, and heavily taxed. Wow, what I gave up to live here! Did I forget winter?
My S-I-L who now lives in Rhode Island just left for her home there a few days ago. 20-something inches during the two weeks she was here in the Philippines. She really wasn’t in a hurry to leave LoL. Why on earth people stay in that mess when they could live so much better and cheaper I will never know. Mass hypnosis or something like that.
Good for you Paul……. I hear you ,am sure you made the better choice good to know am not alone. can relate as well …..
Went back for a visit to the states in the fall. I just sat at a table at a little coffee house one cold day, and listen to the folks talk about life around me. Job or lack of,bills,house re-finance etc.
Really hit home to me , the Burako coffee was far much better in lipa
Great article,get the points and examples.
But wish they would have taken in to consideration with the example that Big mac portion sizes are way different in the other countries.Witch effect cost and price…….. They are budget to fit the portion size and budget/of the country. Witch in the end throws there numbers out of wack??
I suppose that’s a valid objection. Bruce. Although the Big mac is still way too much fat here in the Philippines as in the US. I guess I never noticed the difference exactly, the Big Mac, by the time I left the US was already “not a very big” burger, but I guess the Philippine ones would certainly come up smaller. The French fires are for sure smaller, so in that case the comparison is certainly flawed. It’s still a pretty good rule of thumb, I think, but it points up the difficulties of comparing “apples to apples” when trying to pin down a cost of living.
One thing that does cross my mind on this is … relative costs. To me here in the Philippines, McDonald’s is darn expensive. During my last few years in the US, my wife and I often didn’t bother with brown bagging or making lunch at home. We’d go on kind of a regular circuit to fast food places near our work, for the perpetual 99 cent specials. For the two of us it was rare we spent more than $5 total. Here, it’s hard to get out of McDo for less than the equivalent of $5 USD.
McDonald’s is also a cheap lunch in Japan, a notoriously expensive place. Every “Makku” has a menu “setto” luncheon specials .. a sandwich, fries or rice and a soft drink or a coffee for (at that time) $5 to $5.50 US. Since the Yen has gained a lot against the dollar since I lived there, the same meals would now be $6 or $7 USD. Cheap for Japan but more than I try to hold my spending to on lunches.
Anybody reading in the US right now who goes to McDonald’s often? Can you still eat for a couple bucks by sticking to the specials?
Thanks for the comment Dave. I go back to usa few trips a year, for business and visit my now elderly folks,and hunting season(Idaho). Yes you can still grab lunch for a few bucks, they had a “ressesion menu” when was there in the fall.Not that Mcdo is a place we visit often heheheheh… I have actually improved my health and eating habits here in the philippines. Do to all the wonderful fruits and veg. ,witch did not like much in the usa. Organic here really is a great thing have learned to enjoy,such a difference in taste(organic items through the roof in usa)… You can afford to eat better here verses the usa in my oppinion.
very true what saying, you could go out and eat fast food more affordable in states verses going home/with the bought goods,and try to prepare a well balanced healthy meal after a hard days work…… very sad. The marketing of the usa still wins some battles.
so if there is any truth to adding years to your life for eating better? The philippines will make me live longer because eating better ???????? whats the price for health? hum…
I picked up that you and your wife use to live in colorado Springs? ( reminded me of years ago when was at the Olympic Training Camp)Sure would be getting colder there this time of year…
have a nice week..
Hi Bruce,
Where are you in the Philippines? Actually, one of my chief disappointments here is the lack of vegetables, variety, quantity and quality. There is a dearth (around Manila, anyway) and they are proven profitable, but the resistance to change in what gets grown and harvested seems stronger than the lure of profit. The only time I miss the US that much is when I watch cooking shows on TV and see the wonderful produce, variety of canned goods, jugs of milk, etc. Most Americans have no idea of how blessed the US really is in terms of plentiful and cheap foods.
Yes Mita and I lived in Colorado Springs before we came here. I was there from 1981 with time out for a few years in Japan, Mita joined me there in 2000 and came back to the Philippines with me in 2006. Colorado Springs? Hate the place. Nasty hotbed of white supremacy types and a headquarters for a lot of self-aggrandizing Media Ministers who will be happy to tell you that they own the keys to the Kingdom. Too cold by a long shot for me, too.
Aside from that, I liked it fine
Dave ,
Thats funny about Colorado, thought a little of the same the few times over the years when spent some time. Reminded me a bit of Idaho in some aspects where my folks live.
Where are we in the philippines? About 20-25 min. from Tagaytay. We are also at throws of working on a place in Roxas,mindero for the weekend get away. Love the seafood..
About the food comment. I have never lived my life paying retail for much when could help it,witch makes a huge difference.
We buy all are fruits and vegetables, from the farmer itself. We made a deal Either we give them are money or we give it to someone at the market they will be selling it to0.
Also at the markets in the am the trucks from all over come in and they sell to the people trying to make a few peseos. Have learned they will be happy to sell to you for the same price weather you buy 1 or 50.
We buy all our dairy from a dairy. Meats ,eggs etc. I buy direct from the farmer.
If my other half’s folks did not know someone who grew or had a farm, we asked the burangy. There is always someone wanting to sell something.
All the places are not far from us, they will bring to the house even, do not have to go battle the crowds at the market. So works out well…
I also do alot of canning fruits/jam,pickles,bread makeing. What I can’t find some of the vegatables ,Bring seeds from usa(witch can get online). We have a property that the folks were doing nothing with. I hired a guy,”kind of like your gardner” to take care of things. Do spices,large tommatos etc. We get so much food out of this, I give lots to charity situations,and gave my gardner guy a job,and he gets food for his family,and are useing the property so all is good.
Granted To be honest I may be able to do a few more things than the adverage Joe blow in this regaurd. I got a knot in my stomach heheheeehe…… when you were talkin about the foods shows etc. Lets just say
The second venture led me back to philippines for a more pleasant relaxed life.
I am retired from those days,One of the reason moved here to get away.This was part of the ” rat race,” I talked about before a bit. Worked many years as a corporate chef/food show networks and consulting……
Like mosts chefs, was always working on getting out of it
Yes usa has the variety of food you just have a hard time finding here,from my experience. We use the big boxes you were talking about in your blog for the can goods ,household and personal items and ‘Door knobs”
. The quality and price that have not been able to find here. But have learned to make do with the location. Not having a few things from being maybe a little spoiled ,is woarth the trade off for the days of hitting the “advil” , to me… Now only get a head ache once in awhile from riding the motorcycle with all the wonderful drivers 
We are going to Manila tomorrow think we will hit that
“Brothers Burgers” (you had to get me thinking of one)
You got to love a good burger
Take care Dave
Dave: Happy New Year! When I was in grad school, the Economist’s Big Mac index is taught because it is the only real gauge between relative living costs across borders, also known ass PPP, or Purchasing Power Parity. (nearly all of the ingredients must be sourced locally and the variables, (rent, labor, and overhead) quickly become apparent). In the case of the Philippines, labor is much cheaper here, therefore, your Big Mac is cheaper. The nice thing about the index is that it really gives an estimate of what money is worth in a particular place (You can compare with other currencies, like your Japan example)
Enjoy your articles… Best wishes for a prosperous and happy new year.
Thanks for that explanation/amplification John. It’s always good to get feedback from someone who has both the theoretical and practical experience. All the best to you and yours in 2010. One of these days we have to set up an eyeball at TriNoMa .. I wouldn’t go across the street, normally, for a Big Mac, but Bob got me going on those Brother’s Burgers and they have an outlet there … all this burger talk is making me hungry
Dave: sounds like a plan, if I’m ever here long enough! Brothers sounds really good, now that you reminded me of Bob’s article again. Was in town about 3 days since October… Been needing to go to the dentist since September, but haven’t been here. I guess there’s always the doorknob!
Doorknobs do work too, but a sore mouth will impinge upon your enjoyment of the hamburger, so I recommend a different solution. Your schedule sounds a lot like the ones of a few other guys I have known who moved here with active jobs or consulting gigs. They wind up beig so busy there so little time to enjoy anything. Somehow we have to strike a balance, and it is often harder than anything actually work-related to do so. You’re already in QC, wghen you are home, correct? I’m available on fairly short notice most any day, and it’s easy for me to get to TriNoMa, let’s do somethings soon before the end of the month gets any closer, as I thnk more vistors or other time bandits are approaching then.
Dave ,
Thats funny about Colorado, thought a little of the same the few times over the years when spent some time. Reminded me a bit of Idaho in some aspects where my folks live.
Where are we in the philippines? About 20-25 min. from Tagaytay. We are also at throws of working on a place in Roxas,mindero for the weekend get away. Love the seafood..
About the food comment. I have never lived my life paying retail for much when could help it,witch makes a huge difference.
We buy all are fruits and vegetables, from the farmer itself. We made a deal Either we give them are money or we give it to someone at the market they will be selling it to0.
Also at the markets in the am the trucks from all over come in and they sell to the people trying to make a few peseos. Have learned they will be happy to sell to you for the same price weather you buy 1 or 50.
We buy all our dairy from a dairy. Meats ,eggs etc. I buy direct from the farmer.
If my other half’s folks did not know someone who grew or had a farm, we asked the burangy. There is always someone wanting to sell something.
All the places are not far from us, they will bring to the house even, do not have to go battle the crowds at the market. So works out well…
I also do alot of canning fruits/jam,pickles,bread makeing. What I can’t find some of the vegatables ,Bring seeds from usa(witch can get online). We have a property that the folks were doing nothing with. I hired a guy,”kind of like your gardner” to take care of things. Do spices,large tommatos etc. We get so much food out of this, I give lots to charity situations,and gave my gardner guy a job,and he gets food for his family,and are useing the property so all is good.
Granted To be honest I may be able to do a few more things than the adverage Joe blow in this regaurd. I got a knot in my stomach heheheeehe…… when you were talkin about the foods shows etc. Lets just say
I am retired from those days,One of the reason moved here to get away.This was part of the ” rat race,” I talked about before a bit. Worked many years as a corporate chef/food show networks and consulting……
Like mosts chefs, was always working on getting out of it The second venture led me back to philippines for a more pleasant relaxed life.
Yes usa has the variety of food you just have a hard time finding here,from my experience. We use the big boxes you were talking about in your blog for the can goods ,household and personal items and ‘Door knobs” . The quality and price that have not been able to find here. But have learned to make do with the location. Not having a few things from being maybe a little spoiled ,is woarth the trade off for the days of hitting the “advil” , to me… Now only get a head ache once in awhile from riding the motorcycle with all the wonderful drivers
We are going to Manila tomorrow think we will hit that
“Brothers Burgers” (you had to get me thinking of one)
You got to love a good burger Take care Dave
Hey you guys I am 40 miles east of Denver and it has been not much above freezing for over 3 weeks now, and there is another storm moving in tonight. Talking 9 more inches of snow, an a high tomorrow of 9* F with 15MPH wind. I am 55, divorced for 12 years, been a single Dad for 10 years (daughter has just moved to CA and soon to be married and join the Air Force), have not had any serious relationships since divorce, and have been on SS Disability for 12 years (drawing max $). I have no family within 750 miles, I am tired of being alone, struggling with money, and dang I mean dang tired of the cold. I am sorry I have put all of you through this, I guess I need to talk. I have a plane ticket to Manila in 26 days, I can’t wait and I will be there till the 3rd March. I will be traveling with a friend who’s Dad has lived on Panay Island for 11 years and has a restaurant-bar at Sabang Resort called Eddies Place and we are both Okies. Now I will have to admit I am going to meet my friends widowed cousin that I have had correspondence with for over a year. You all know where this is going. This is the first time I have posted to a chat site, but whoever mentioned Colorado Springs got me started. I have been looking at web sites for 2 months about moving over there. Soooo many places to go and stay and with my SS I can do it and I have started down sizing cause I am going somewhere. So I ask everybody be kind and give me some guidance. Regards, Thanks in advance BTW I don’t give a dang about Fast food. : )
Hello Carl,
Welcome to PhilFAQS. You can comment all you want here, but it sure isn’t much of a chat site. My purpose in keeping the doors open is to provide people the information they need to decide if moving to the Philippines is the right thing to do …and if it is the right thing for them, to decide the where and the how of geting it done. Be sure to read some of the articles on living on Social Security in the Philippines, how to stay in touch while living in the Philippines, etc. I try to have answres for all the questions, if there’s somehting I didn’t cover, please let me know.
You’re coming at a grea ttime, it will still be cold there in Colorado but the weather will be warm enough to suit nearly anyone here. Having lived in Coloraod myself for over 20 years, the only thing I could say much in favor of living 40 miles east of Denver is that it’s really close to DIA for making a quick escape
. best of luck and hope you enjoy your trip.