IS IT CHEAPER TO LIVE IN THE PHILIPPINES?

Is it really cheaper to live in the Philippines than in the U.S.? A lot of people have been misguided into living in the Philippines because they believe it is cheaper than in the U.S.

BUT IS IT? Depends on your point of view and of course if you believe it is, then maybe it is for you. But let’s examine some of the basics.

If you smoke or drink, then YES, it is much cheaper in the Philippines as there is no big tax on tobacco and alcohol like in the U.S. Haircuts, manicures, and any service related item is going to be much cheaper as the average minimum wage in the Philippines is around $6 a day (Metro Manila area is higher and some provincial areas are lower). Many many many people are willing to work for even less than that and as little as $2 a day.

However, if you look at food, clothing and shelter, I’m not so sure it is that much cheaper and in some cases turns out to be more expensive than in the U.S. (hope to get lots of comments about this). I’ve been married to a Filipina since 1990 and have stayed average of 3 months a year in the Philippines (currently working in the U.S. and plan to live at least 6 months a year in the Philippines after my two children graduate from college in California), so I have seen costs rise and feel I am qualified to compare the two countries.

Some food items are cheaper in the Philippines, but not all. Dairy, meat and eggs are definately about the same or in most cases higher in the Philipines. We definately have cheap food in the U.S. compared to most countries. Fast food and restaurants tend to be a little cheaper due to lower labor costs but then they have 3 to 5 times more employees than in the U.S. so their total labor cost is higher than you might first think. Portions tend to be smaller in Philippine fast foods, so if you compare same size item, it is about the same as the U.S. Carrenderias are an exception, but then there is nothing to compare that in the U.S. as the health department would not allow such a food establishment anywhere. Also, soft drinks that are sold in the sari-sari store may seem cheap, but remember you are purchasing the contents only and do not have to pay for expensive packaging as in the U.S. Can drinks are about the same except they do not charge a redemption value in the Philippines. Some local vegetables are cheaper in the Philippines but when you consider all vegetables, i think the U.S. still has lower cost food items.

Electricity cost is so varied in the U.S. it is hard to compare, but generally the electricityy is more expensive in the Philippines. The reason you may be able to live with less utility payment is that your consumption (if you live Filipino style, that is, little or no aircon, much fewer electronic gadgets, lights, appliances etc) is lower an you may not see the difference in the U.S. But have a big refrigerator, American washer and dryer, and on and on and I think you get the picture that it is cheaper electricity in the U.S. Other utilities may not cost much at the present in the Philippines, but I notice water bills per cubic feet are much more expensive in the Philippines and will rise just as they do in the U.S. Big difference of course that in the U.S. we have big lawns that use more water so you may not notice any difference or water may be less since you probably won’t have a big yard/lawn in the Philippines. Of course, you may not even have to pay for sewage or trash collection in the Philippines, but remember that you will have to deal with the smells and piles of trash that the lack of adequate sewage and trash service cause.

You can definately save on clothing in the Philippines, tho many of the items are the same price. Big difference is the quality of clothing that is manufactured for sale in the Philippines. U.S. quality is usually higher or if you purchase a higher quality in the Philippines, the price will be about the same. You can save in the Philippines because you usually will not have to wear coats, sweaters and winter clothing (except in some mountain areas). However, keep in mind that “American sizes” are hard to find if you are BIG AND TALL. However, since material may be about the same (or slightly higher, depending), it will be cheaper to have things custom made because of the cheap labor.

Housing in the Philippines can be cheaper than in the U.S. if you rent and do not require all the amenities you have in the U.S. There are of course some native type housing that you can rent for as little as $20 a month and some even have water included in the rent. I just read some posts for condos in Cebu that cost $200,000 and up. Wow! Condos in our town in the U.S. still start at P75,000. House with lot (as is normal in the U.S.) still are available in many areas for P100,000 or less and compare that to some subdivisions in the Philippines for P5,000,000 and I think you get the picture. Land has increased dramatically in the Philippines and you can buy “tax declaration title” land still cheap, but look into this first as the person on the original title will still have claim to your property. 20 years ago you could buy beach property for under P100 per square meter, but not any more. And now there are many restrictions on how close you can build to the sea, you may wish to check before you buy. Also consider the typhoon damage and storm surge building close to the sea. Building a custom home can be cheaper due to cheap labor in the Philippines but quality materials will cost the same or more in the Philippines than in the U.S.

But I think there are other things to consider besides being cheap or not in the Philippines and that is the quality of life. If you are a country boy and don’t need to live in the city, you can have the quality of life you are looking for at a much cheaper price than in the U.S. I know my blood pressure and general health are improved when I’m in the Philippines as it is a more relaxed pace and not the stressful life like in the U.S. People are friendlier in the Philippines (this is a general statement and I’m sure you can quote exceptions or conditions). 

You also need to consider a “safety net” when thinking about moving to the Philippines. The U.S. provides lots of social services for people in need and this simply does not exist on the same scale in the Philippines. I hear too many stories of expats who need money/food/housing and somehow feel that other Americans in the Philippines owe them this “safety net”. Better think twice about moving to the Philippines if you do not have a “back up plan”, “Plan B”, “safety net” etc. The U.S. Consulate will not loan you money when you need it and you will not be able to get financial help from a church in the Philippines (like in the U.S.).

My reason for living in the Philippines? My wife is a Filipina, my heart is at Virgin Beach Resort, I love the Filipino people and their beautiful country.