In this report, I explain Why Philippines living costs range from $800 to $5000 USD per month and the two cost variables you need to watch to stay within budget.
Since I left the USA in 2007, I have lived in or visited 67 countries in the world. I have met more ex-pats living overseas than I can remember over the last 15+ years. But, I would guess that 90% of ex-pats living costs range from $800 to $5000 USD per month worldwide.
Whereas, most of the ex-pats I meet in the retire cheap in paradise countries seem to be living in the range of about $1200 to $3000 per month range. So, are you wondering what it would cost you to retire overseas?
Well, stick with me for a minute and I think this video will help you figure that out. After I define a few things, I will give you example living costs based upon the kind of life you will be living in retirement. And I will give you some Philippines living cost examples once I explain what I see as the two main variables of living costs.
There are two ex-pat behaviors that seem to affect living costs more than any others. I will explain what these two variables are, how they are related, and how you need to consider both when trying to figure out what your budget will be as an ex-pat in the Philippines or any other retire cheap in paradise country.
Two Largest Cost Variables for Expats
The word ex-pat just means someone that is living outside their home country.
First Variable: The Integration Spectrum
If you follow my channel, you have heard me talk about the first variable before. But today I am giving it a name. I will call it the Integration Spectrum. The Integration Spectrum ranges from the lowest cost of living possible which is a complete integration into the local culture all the way up to the highest cost of living possible which is achieved by living completely in a bubble with almost no contact with the local culture.
If you live with the locals, eat with the locals, and play like the locals, then you are fully integrated into the local culture. An ex-pat that fully integrates with the locals will be able to live on a local’s budget, or close to it.
A fully integrated ex-pat would have the lowest potential cost of living on the integration spectrum. Whereas, your cost of living escalates rapidly if you try to live overseas in an ex-pat bubble.
Most ex-pats live at least partially in an ex-pat bubble. They may live in nicer housing than the average local, they might eat and drink in more expensive foreign bars and restaurants than the average local, they may have more expensive cars, trucks, and toys than the average local, they may spend more on trips and entertainment than the average local, and they may also hang out exclusively with other ex-pats.
In order to determine where you will live on the Integration Spectrum, you will have to do an exploratory visit and do a cost analysis. You will have to put your feet on the ground and see it with your own eyes before you will know where you will be on the Integration Spectrum and what your cost of living will be.
Okay, time for a brief explanation about the second variable.
Second Variable: The Travel Frequency Spectrum
Some ex-pats move overseas and just stay in one location for multiple years in a row. If an ex-pat remains stationary in a single location when they move overseas, then they have almost no additional costs on the travel frequency spectrum. They are stationary.
They just pay their local rents, food, and other expenses but they have no additional travel costs.
However, other ex-pats like to spend money traveling around their new country. Depending on how often they like to travel, and how long they stay when they are away from their home base, their travel expenses will vary greatly.
Other ex-pats are like me. They like to slow travel around the world. The cost to slow travel the world will depend greatly on a number of factors, such as, (1) How often you move between places, (2) The number of international and intercontinental flights you take per year, (3) Whether or not you maintain an empty bed somewhere in the world as you travel, (4) Whether instead of an empty bed, you slowly move forward through the world completely exploring each new country within a continent before you buy expensive intercontinental flights.
A high frequency of moving between locations in a country or the world will explode your budget for a number of reasons. First, you will have to pay for the travel between destinations. This could be significant depending on how much ground travel you use versus airfare.
A high travel frequency is much more expensive in your nightly rate for accommodations. If you stay for a month or more in each place, it is easier to get a bargain on rents, because the landlord knows they will have no vacancy for an entire month.
Finally, if you move forward slowly and never buy round trip tickets back to your empty bed, there is no empty bed (apartment) that you are still paying for as you slow travel the world.
So a high frequency of travel means a shorter duration in each location. A shorter duration in each location means higher rents rates, but also means paying travel costs more often because of the moving frequency. Now I will explain how these two variables together drive you higher or lower annual costs of living.
Stationary-Integration: (Cheapest Lifestyle) The cheapest way to live outside your home country is represented in the lower-left quadrant. It is called a stationary integration. Stationary means that you move locations rarely if at all each year. Maybe you go home for a week or two every other year and go on day trips from your foreign stationary base, but you are not a frequent traveler once you move to a foreign country. Integration means that you live more like the locals than a bubble ex-pat. You learn about the culture and you live to some degree like a local. The reason the Stationary Integration is light green is that it is the cheapest way to live–it takes less green.
Stationary-Bubble: (The stationary Bubble quadrant means you are stationary as mentioned in the previous paragraph, but the bubble means that you try to recreate your old life in your new country. You eat and drink in Ex-pat restaurants, rent western-style accommodations, and most likely are trying to get local people to do things like you expect them to be done at home. You spend less time in the student mode and more time in the teacher mode. The color is much greener than the Stationary-Integration because the ex-pat lifestyle can cost two to three times as much or more than living like a local.
Frequent-Integration: Frequent implies you move places throughout the year more frequently. You might even be what I call a slow traveler. To learn more about the slow travel world highway, read this report. As said before, we traveled to 30 different places in 6 different countries in 2021. Frequent travel can get expensive. But the way we try to keep expenses low is to live like a local as much as possible as we visit each country. We try to learn about and cook local foods, stay in cheaper more local accommodations when possible, and learn about the culture. Learning about the locals and trying to live more like them is the second part of the Frequent integration quadrant. A frequent integration traveler costs more than a stationary integration, but less than the last quadrant.
Frequent-Bubble: If you move places frequently and stay in western accommodations, eat in western restaurants, and hang out mostly with other ex-pats doing the same, your life will represent the frequent bubble lifestyle. A frequent traveler that wants to recreate the life they had in their home country will be the most expensive of all. That is why it is in dark green color. The sky is the limit in a frequently traveled ex-pat bubble.
Why Philippines living costs range from $800 to $5000 USD per month based upon these two variables
Price Point 1: At price point 1, you have the potential to live on $800 per month as an ex-pat in the Philippines living in a Stationary-Integration. You integrate into the local population for the most part. Meaning, you live like a local amongst the locals. You live in local-style accommodations, you stay out of expensive ex-pat restaurants and cook local foods at home and eat in local-style restaurants with locals. You seek your entertainment with the locals meaning you befriend and play with the locals. You may have a few ex-pat experiences in any given month, but mostly you follow the lead of the local lifestyle. At price point 1, your cost of living will range from about $600 per month to $1000 per month depending on how strictly you are willing to live like a local.
Price Point 2: At price point 2, you have the potential to live on about $1200 per month as an ex-pat on the low end of a Stationary-Bubble in the Philippines. You are willing to pay more in rent to have a more western-style apartment. You pay more in utilities including a premium internet bandwidth. You spend more time with other ex-pats than locals. You are willing to eat in ex-pats restaurants from time to time and pay more for imported foods and even some imported alcohol from home rather than shop exclusively in open-air local markets. You also spend more money on exploring the world around you like ex-pats tend t do. At price point 2, your cost of living will range from about $1200 per month to $2500 per month depending on how extreme or expensive the ex-pat bubble is that you decide to live.
Price Point 3: At price point 3, you have the potential to live on about $1200 per month as an ex-pat that is not stationary, but moves frequently while integrated into the local population, as a Frequent-Integration in the Philippines. You integrate into the local population moving to a new place every month or so in the Philippines. As you move forward slowly through the Philippines (Slow Traveling), you do not maintain an empty bed anywhere in the Philippines. When you move between places in the Philippines, you ride on ferries between islands instead of flying, and you ride on local transportation like Jeepneys and tricycle motorcycles. You eat with locals, you stay in local-style temporary accommodations, and you seek mostly do-it-yourself-style excursions while riding around on public transportation. At price point 3, your cost of living will range from about $1200 per month to $1600 per month depending on how competent you are in exploring the Philippines like a local instead of an ex-pat.
Price Point 4: At price point 4, you have the potential to live on about $2400 per month as an ex-pat that is not stationary, but explores new places every week or two while living in an ex-pat bubble moving through the Philippines, is living in a Frequent-Bubble. You stay in furnished Airbnb.com apartments paying weekly instead of monthly rates. You eat almost exclusively in ex-pat restaurants. You cook imported foods you bought in an air-conditioned supermarket instead of an open-air local market. You take paid tourist excursions frequently as you explore each part of the Philippines. At price point 4, your cost of living will range from about $1800 per month to $5000 per month depending on how extravagant and Frequent the Bubble is that you travel. But you could easily spend much much more if you are a baller and money is no object.
We are headed back to the Philippines tomorrow. Make sure to subscribe and ring the notifications bell if you want to watch us slow travel through the Philippines.
Okay, now you know Why Philippines living costs range from $800 to $5000 USD per month. But if you would like to know the example costs of living in four different cities in the Philippines just click our Youtube Playlist for the Philippines in the upper left-hand corner of the screen when this video ends.
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This is Dan of Vagabond Awake, the Youtube channel for VagabondBuddha.com. Thank you for stopping by. The world is your home. What time will you be home for dinner?