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Financial Freedom Retiring in the Philippines

As you all know and read here and on other sites, living in the Philippines is cheaper than in the U.S. and other countries but there are things to consider.

First is inflation. I have not tracked the price increases in the two years I have lived here but one item I remember is gasoline. When I first moved here, gas was about 30 pesos per liter. Today it is 43.80 pesos per liter, which is one peso less than it was in the past few weeks. From what I could find, the inflation rate in the Philippines is about 4.6% whereas the U.S. is around 2.6%.

Then since most Expats live from the payments of their retirement, pensions and investments you are at the mercy of your home countries conversion rate to pesos. When I visited here the conversion of the U.S. dollar was at 50 pesos. When I moved here, it was down to 40 pesos to the dollar and lately it has hovered around 46 pesos. Not only does your dollar goes less far once converted to pay your expenses, the imported products you like to buy to make it feel more like home gets more expensive too.

Your lifestyle here is going to be based on that conversion. Some people predict there is the possibility of the conversion to drop to 30 pesos to the dollar since the U.S. dollar value has been dropping in value. As the peso drops, you get less for your dollar after exchanging it to pesos.

Some Filipinos like to see their peso get stronger. However, what does that end up doing to the country and all the people living here? Well, look at this, 14% of the GNP is OFW (Overseas Filipino Worker) remittance. The OFW administration requires the OWF to be paid in U.S. dollars. As the peso gets stronger and the exchange conversion gets less all the families get less pesos each month. Then manufacturing and importers are paying more from products purchased from America. Then exported products will return fewer profits.

Another worry in the future is available electricity here. Another site wrote an article that there is less availability of electricity in the Philippines. This is because of the increasing demand for electrical power throughout the country and scheduled moving brownouts might occur in the future to reduce electric consumption.  To fix this problem more power generating plants will need to be built. Who will pay for these new generating plants? Of course, the consumer. Here again will be an increase of cost to live here.

Even though it is cheaper to live here than in our home country, it is still not an easy ride here. With currency conversion rates unpredictable, increase in utility costs and inflation here and abroad life will get more difficult.

I am going to expand this to another article about starting a business and making money here. Look forward to it.

24 Responses to “Financial Freedom Retiring in the Philippines”

  1. rich says:

    good stuff bruce 🙂 any mockups yet?

    • Bruce says:

      About the schematic or mock-ups, I have asked my architect friend and emailed him again today. If I get no positive response this week, I will contact some of the other architects I know here that are willing to work with me.

  2. Gene says:

    Hi Bruce,

    You are right on this one for sure. Even here in the Angeles area prices are starting to rise. Maybe not as much as in your area but still noticeable. We are closer to Baguio here so the price of veggies and fresh fruit is still within reason. Gasoline here is high like your place.
    A friend of ours just returned from a trip home to New Mexico three days ago. Prices in the states are higher than ever with no end in sight. He stopped in Las Vegas for a few days and the news paper there is reporting a 14% unemployment rate in Nevada. Unreal compared to just a few years ago.
    The main source of income for Nevada is gambling. And the primary source of the gaming industry is from California, Oregon, and Arizona. So one can only imagine the situation in those states that have pretty much cut off the income for Nevada. I was told that the huge Las Vegas Hilton Hotel is in receivership even!

    Here at the duty free stores in Clark airbase and at the Ayala Marquee mall in Angeles City the imported items are still priced about as before.
    I have never really liked rice to speak of. But at the mall there is a good rice outlet that sells Chinese black rice that I do really enjoy. Its rather high priced at P75.00 per kilo.
    But my family and I eat only about three kilos of rice per month so no problem there.

    So no matter how things look here, it is still far worse in the states and I would assume will still get much worse.

    Viol and I were talking about this very thing just last night at dinner. She did the math and even if we were both working in any given location in the states we could hardly make it. Especially as things deteriorate there even further.

    So for us, no matter how it gets here, we figure we are better off right here in paradise. And what the heck, if it ever got bad enough, I guess we could always find a stray dog to put on the BBQ! Hahahaha…

    • Bruce says:

      Thanks for your take on the subject there and the news from back home.
      I eat rice rarely lately. I feel I get enough carbs from bread at lunch and snacks and wait for the pasta or potatoes.

      If things get too bad for you, look for the Viet Nam cookbook, 101 ways to Wok your dog

  3. Lance says:

    great to see an american blogger from the Philippines.. I can’t agree more on your point here… Currency value and market prices are so unpredictable..
    Hope you could visit my site too and drop some words! Cheers!

    • Bruce says:

      Thank you for visiting. I try to write honestly in my view and when I write about culture, filipinos and life here, I try to again be honest but show respect to the Filipino situation.

      I will visit your site and I hope you continue to visit here and comment.

  4. Gene says:


    I’m with you and never cared for rice at all. Even the brown rice at home or the long grain Spanish rice either. Alwasy tasted to me like eating a cardboard box.
    But tell ya what, this black rice is a whole new ball game. Not sticky and has a wonderful nutty taste. Black rice is also known as Forbidden rice; as centuries ago the Chinese Emporer was the only one allowed to grow or eat it. Thus, the name, Forbidden rice.
    But what they didn’t know back then is that it has wonderful health benefits that other rice just does not have.

    Take a look at this site on the subject. I have a feeling that you and others just might want to give it a try.

    Its at:

    • Bruce says:

      Thanks. I will look for it and give it a try. There is a Turkish restaurant we eat at that uses a higher quality white rice and there are pieces of behong noodles in it. It is so good I can eat it just as is. But at home the family prefers their 7 Toner rice with low water content and boring.

  5. chrisroger says:

    “Even though it is cheaper to live here than in our home country, it is still not an easy ride here. With currency conversion rates unpredictable, increase in utility costs and inflation here and abroad life will get more difficult.”

    actually its not that bad compared to other countries. i’ve lived in many countries and they to have the same problem and believe it or not it is still better to stay here in the Philippines specially for retirees but if your really want to earn money by being an employee then get the hell out of here unless you have a very special position. 🙂

  6. Bruce: Very good article. You are correct in what you say. What is really worrysome now is the value of the dollar. I am unemployed now here as I might have told you before but I have started to do some trading in the stock market! No easy money to be made in that either, but at least I have something to do! It has been a funny month in this. The stock markets is up one day and down the other. The job situation seems bad here at the moment. Unemployment rate is similar to what it is in the US.

    Gene: I love rice! In this country the base food is potatoes, which I never have liked in my whole life. It really both smells bad and tastes bad. 😉 I think I should have been born in Asia, hehe.

  7. Gene says:


    If you know or find out the name of that rice that you like please let me know and I’ll give it a try.


    Maybe its the type of potatoes available where you are that smell and taste bad??
    I even livid in Idaho where so many potatos are grown. Great food!

    • Bruce says:


      I will ask next time I am there.

      Stefan, Gene is right. I have eaten many types of potatoes and never had any that smelled bad and mashing potatoes with some roasted garlic or other seasoning enhancers can vasy the taste to match meal.

  8. Well, Sweden is well known for good potatoes. More a matter of taste I think. I never had bad rice in my life, except for the really bad quality ones, but I never eat them cause it is also a risk to get your teeth broken ;-). Fried potatoes and french fries, i like it a lot! But I meant boiled potatoes. I dont think it is good to eat especially french fries. If I go to McDonalds I never eat french fries the last five years. Comparing boiled potatoes to boiled rice. Wow, rice is so much nicer base food!

    Bruce, the stock markets are very risky, especially at the moment. I am trying to learn cause it interests me. But it really takes a lot of skills and some luck to make money out of it. What is good is that I can sell or buy stocks if I live in the Philippines, just need a good and reliable connection!

    • Bruce says:

      For me a high end rice cooked with some butter or flavorings I enjoy. The rice at home is cooked very still and little flavor. With potatoes I enjoy mashed, roasted or baked. Boiled potatoes are fine if sliced with a seasoning too or in a mix of boiled vegetables.
      I have never fully understood playing the stock market and was never willing to risk a loss trying to learn.

  9. Seth says:

    Bruce and Stefan,

    You can remove all the risk from “learning” to play the market by using a “paper” account. You do not want to invest until you can make a profit on paper. Once I move to the Philippines, I plan on having my money in Mutual Funds and that way negate most of the risk of the investment. Right now in America the market takes giant losses each time the President gets on TV. It seems that Wall Street is afraid of his economic plans. The price of gas has reached over 2.50 a gallon in the South. Unemployment has not hit us as hard in Louisiana as it has in the rest of tht country.

    As for the rice, I live in the south and we grow it here so all of us Cajuns have learned how to eat it. When the wife eats her plan rice I add a little Soy Sauce to it. But the potatoe is much more versatile in my opinion. But bring on the fried rice and I am usually a happy man.

    • Bruce says:

      I had seen programs where you play the market as a game. For me, I do not understand anything more than buy low, sell high and make money. Without understanding the reasons for the market to work as it does, it is best for me to put my centavos in a jar.

  10. BILLY ESCOBAR says:

    Sorry to say but I see an inevitable collapse of the U.S dollar within the coming decade. The way the Government is spending and the debt piling up we are currently just delaying a depression. I’ve just recently been turned on to Austrian Economics and have yet to learn more but from what I see so far its not looking good.
    If only the U.S could change its foreign policy, we would be saving trillions of dollars.

    • Bruce says:

      I see your point but I hope they are smart enough in DC not to let it happen. If it does, please send me a sack of rice for us to survive.

      • Billy Escobar says:

        Bruce there are alot of so called “smart” people in DC. Experts, Anaylzers and Professors. Very few wise people though. I’ve been following World and U.S politics the past couple years and its very disheartening. A good place to keep up with unbiased news is PBS or BBC news is also a pretty good source. I wonder if the Philippines has an equivilent to an independent New source like PBS. I find most Mainstream news to be laughable IMO.

  11. Per says:

    Personally, I am against the whole idea of the stock market. It will always inevitably become a bubble and then crash for a very simple reason: people buy and sell not based on what they can earn in dividends from the company, but on what price they can sell the stock for later.
    If you buy stock as an investment for what it can give you in dividends from the company, its ok… that is an investment in the value and growth of the company, so to say. You keep the stock because it will by-and-by bring you an income through the profits of the company.
    But the problem is that too many dont buy to keep the stock for the long-term return through dividends, but only invest short-term for what they think they can sell the stock for next year or even next week. That way, the stock becomes a fake-value. Its the same thing as the tulip-bulb bubble back in 1636–37. Its the exact same thing, but the idiocy of it is more obvious with the tulip crash.

    It is speculations in the stock prices that has over and over caused economic crashes in modern history. Why this trading is still allowed is beyond me.

    • Bruce says:

      Good thought about the stock market. My feelings is except for dividends is this: a company has a stock offer, everyone buys shares and the company gets money. You get a piece of paper. After that, all sales of the stock is from one person to another. Your selling this piece of paper with a company name on it. Since I do not understand the market and how it all works, it is better for me not to invest in it. I let others do it for me who managed my retirement investments.

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