Philippines

Why Retire To The Philippines?

One of the newest retirement destinations for baby boomers is the Philippines. Lying between the South China Sea and the Pacific Ocean, the Philippines is a famous tropical paradise. Its low cost of living, high amount of entertainment and amenities available, and climate are just a few reasons that retirees from Europe and North America are discovering this paradise made up of over 7000 islands.

English is widely spoken in the Philippines, making it much easier for baby boomer retirees from North America and Europe to fit in. Additionally, Philippine natives are quite welcoming to expatriates, and there is a large community of expatriates there to welcome new retirees venturing to the country.

Low Cost of Living in the Philippines

The low cost of living in the Philippines is a prime attraction to many baby boomer retirees who choose the island nation as their retirement destination. According to Numbeo, rent prices in the Philippines are almost 80 percent lower than those in the United States; prices at restaurants in the Philippines are typically 70 percent lower than those in the U.S.; and grocery prices are over 50 percent lower in the Philippines than in the U.S.

It is, of course, more expensive for retirees to live in the Philippines’ larger cities than in the smaller towns and villages. Baby boomer retirees in the Philippines report living quite comfortably, including dining out and traveling often, on $800 to $1200 per month. Many even have enough left over to hire household help for cooking or cleaning, something that they likely could not afford back home. Using local vendors is another great way that retirees say they save money.

One thing to remember as a retiree living in the Philippines is that international money transfers are quite expensive. There are high fees levied on such transfers. Using a domestic bank from one’s home country to move money to a bank account in the Philippines is not the most financially viable option for retirees. Using a special service for international transfers is more likely to save a retiree money in such a case.

Rents vary widely from one part of the Philippines to the next. In smaller cities such as Dumaguete, Baguio and Davao City, rents range between $150 and $225 per month. Within larger cities like Manila and Cebu City, rents are higher, at $400 to $600 per month. Purchasing a property might be a good option for some retirees, as beachfront condos sell for less than $100,000. There are some rules, however, on foreigners owning property in the Philippines. For example, non-residents may own condominium units built in the Philippines, but may not own the property on which they are built. Likewise, foreigners in the Philippines may own houses but not the land on which the houses are built.

The Philippines’ Climate

Many baby boomer retirees are attracted to the Philippines by its tropical climate and appearance of paradise. Some have described the Philippines’ climate as “megadiverse,” as thousands of animal and plant species live in its beaches, coastlines, rainforests and mountains. Beautiful white sand beaches, crystal clear blue water, and colorful coral reefs can all be found among the islands making up the archipelago of the Philippines.

Although officially, the Philippines have what is known as a tropical maritime climate, the country has five different climate regions. These include tropical rainforest, tropical savanna, tropical monsoon, humid subtropical, and oceanic. Three seasons exist country-wide: a rainy season, a cool dry season, and a hot dry season, each based upon the amount of rainfall received during that season. Generally, the rainy season lasts from June to October and the dry season from October to May. Temperatures are cooler from November to February, averaging in the low 70 degrees Fahrenheit, and hotter from March through October, averaging in the mid to high 90s. Humidity is usually high in the Philippines year-round. These are all things that baby boomer retirees must take into consideration when making the decision to move to the Philippines.

Incentives to Retire to the Philippines

The Philippines have a government agency whose sole purpose is to attract retirees from other countries. Thus, baby boomer retirees have many incentives to retire to the island nation.

A special retirement visa, called the Special Resident Retiree’s Visa, or SRRV, is offered to those who meet certain requirements. These include being over age 35 and paying a deposit to authorities (between $10,000 and $50,000, depending upon one’s age) which will be returned to the applicant once a retirement visa is cancelled. The SRRV allows its holder an indefinite stay and multiple entry and exit privileges in the Philippines, exemption from customs taxes and duties for importing household goods up to $7000, exemptions on taxes on pensions and annuities, exemptions on travel taxes, access to a greet and assist program at Philippine airports, free subscription to the Philippine Retirement Authority (PRA) newsletter, entitlement to health benefits and privileges, assistance in making transactions with other Filipino government agencies, and discount privileges from associated PRA merchant partners. Once a retiree gains permanent residency in the Philippines, he or she does not have to worry about it expiring and can come and go as he or she pleases without having to worry about reapplying for residency.

Because of the young age in which one can apply for the SRRV, many who make their money early in life and can enjoy early retirement choose the Philippines to take advantage of these incentives.

Popular Retirement Destinations Within the Philippines

Retirees prefer certain areas over others when it comes to choosing a new home in the Philippines. Manila, the capital of the Philippines, is a large city preferred by many due to its huge community of expatriates. Keep in mind, however, that Manila has been westernized with many shopping malls, restaurants and movie theaters, so for baby boomer retirees looking for a more “authentically Filipino” retirement destination, Manila might not be the best choice. Like any city, Manila experiences heavy traffic.

It can be quite expensive to live in Manila. Crime is also higher in Manila than in other areas of the country. Because of these two factors, many baby boomer retirees choose cities on the outskirts of Manila in which to settle, such as Cavite and Laguna. These areas have good public transportation services, excellent property available and expatriate-welcoming country clubs and golf courses in abundance.

Another popular area for retirees is the highland area of Baguio (the “City of Pines”). This city is known for its lower crime levels and more moderate climate. It is about six hours from Manila.

No matter where one settles within the Philippines, the lower cost of living should make it possible to conduct inter-country travel among the archipelago’s 7000 islands and visit as many as one likes.

Quality of Life in the Philippines

As mentioned above, Filipinos are quite welcoming to foreign visitors and expatriates who decide to call the island nation their new home. There are a few drawbacks to life in the Philippines, however, that baby boomer retirees should consider before making the decision to move there.

Health care in the Philippines is not uniformly good. In Manila, the capital of the country, healthcare is excellent and affordable. In other areas of the Philippines, however, access to health care is poor and the health care itself may be substandard. Retirees with chronic health conditions may wish to consider this before deciding to move to the Philippines.

Infrastructure in the Philippines has also had its problems. Telecommunications systems are outdated in many areas, making internet and telephone communication difficult. Power outages are common, as are water shortages. Roads, highways and bridges are all in need of repair throughout the country.

Safety is probably the number one concern of many baby boomer retirees when choosing where to spend their retirement years. It is important to note that the Philippines have experienced a rash of violent crime in recent years, since the advent of a new government administration in 2016. In fact, a 2018 travel advisory from the U.S. Department of State warns Americans to “exercise caution in the Philippines due to crime, terrorism, and civil unrest.” It advises that travelers should avoid traveling to certain areas of the country, including Marawai City, Mindanao and the Sulu Archipelago, for fear of civil unrest, terrorism and crime. Additionally, it is advised that travelers should avoid traveling to the Mayon Volcano in Albay Province, Luzon because of volcanic activity.

Other areas of the Philippines, however, are considered just as safe as any area in Southeast Asia in which to travel and settle as a retirement destination. The bottom line: baby boomer retirees who are seriously considering making the Philippines their ultimate retirement destination should enroll in the U.S. Department of State’s Smart Traveler Enrollment Program. This program will keep enrollees updated on security and safety in the Philippines and make it easier to contact a consulate or U.S. embassy as well as to notify family back home if one encounters an emergency during his or her time in the Philippines.

Retirement is the time when one should enjoy life, and many baby boomer retirees are discovering that the ideal place to do just that is the Philippines. Here, they can relax, bask in the country’s tropical climate, enjoy communication with many other expatriates as well as natives, and live the good life in a way that would not be possible back home.