How to Retire in the Philippines as a Foreigner: A Comprehensive Guide

The Philippines could be your best bet if you want to spend your golden years enjoying year-round warmth against a backdrop of beaches and rain forests. The Philippines has much cheaper living expenses than the United States, and the government makes extra efforts to make the country welcoming to foreigners. However, there are several pitfalls tied with this move that you should stay clear of. It may be advantageous to speak with a financial advisor before deciding to retire and settle in the Philippines.

Cost of Living in The Philippines

You might want to think about retiring in the Philippines if you’re having trouble stretching your buck in the United States. The cost of living in the Philippines is considerably cheaper than it is in the United States, according to Numbeo, a comprehensive database of economic conditions. The Philippines and the U.S. are contrasted here in terms of specific costs as of March 2022:

  • Rent Prices: 77.95% lower than in the U.S.
  • Consumer prices with rent: 58.64% lower than in U.S.
  • Restaurant meal prices: 70.99% lower than in U.S
  • Grocery prices: 47.71% lower than in U.S.

Most expats can live well on $1,000 to $2,200 a month, according to International Living, a magazine that extensively covers the economics of living abroad. Housing and going out to experience what the Philippines has to offer are included in this.

How to Retire in the Philippines as a Foreigner: A Comprehensive Guide
Crater of Mount Pinatubo

Visa Application in the Philippines For Foreign Retirees

There may be a few hurdles you need to clear in order to retire in the Philippines with a valid visa. But we’ll guide you step by step through the process.

You must first get one of the Special Resident Retiree’s Visas (SRRV).  You need to complete the following requirements in order to be eligible for one:

  • 50 years of age or older
  • If you have a guaranteed monthly income, deposit at least $10,000 into a Philippine bank (this covers you and two dependents)
  • Deposite $15,000 for every extra dependant
  • Have documentation of a pension paying at least $800 per month ($1,000 per couple).

The good news is that most retirement income sources, including Social Security funds, can be referred to as “pension.”

The head of household must pay $1,400 for the one-time visa application fee, plus $300 for each extra family member. To renew it, you need additionally pay a $360 yearly fee. You, your spouse, and one child are covered by this fee. If you have more than one child, you must pay an additional $100 for each.

You must also get an Alien Certificate of Registration (ACR-I) card with a microchip carrying biometric information in addition to your visa. Moreover, your fingerprints are on it. Together with your valid passport showing a visa stamp and this card, you can enter the country repeatedly. Each year, you should renew it for $50.

You can use this calculator to compute deposits and withdrawals.

Housing for Retirees in the Philippines

It would require some planning to find housing in the Philippines as an foreign retiree. You can buy an apartment or condo unit if you hold an SRRV visa. But you can’t purchase a completely detached house. The good news is that if your total investment in the country is at least $50,000, you may use the $10,000 deposit for the visa to buy one of these properties. So, until you can buy a house of your own, you may want to rent.

Having said that, it’s important to do an in-depth research on a potential place. The infrastructure in some parts of the Philippines is insufficient. This means that in some areas power outages and water interruptions may be normal. Additionally, you’ll want to have quick access to banks, hospitals or clinics, and supermarkets.

You can use this calculator to figure out how much you will save each month (be sure to click the tab: How Much) and/or how much you will need to save to reach your goal (click the tab: How Long).

How to Retire in the Philippines as a Foreigner: A Comprehensive Guide
Chocolate Hills in Bohol

Healthcare Access in the Philippines

Depending on where you live in the Philippines, accessing healthcare may be difficult. Living in the country’s capital, Manila, makes it incredibly easy to receive healthcare. Other areas, however, do not have enough healthcare resources. For individuals suffering from long-term illnesses or expats who need frequent medical care, this may be a serious problem.

The cost of healthcare is substantially lower than it is in the United States, and you can simply enroll in a local health insurance plan. The government healthcare program, PhilHealth is another option that is open to you. Unfortunately, hospitals in the Philippines do not recognize traditional Medicare. Furthermore, many hospitals require payment at the time of service.

Taxes in the Philippines for Retired Foreigners

Foreigners can benefit significantly from the Philippines’ tax system. Only the income that resident aliens receive from local sources is subject to tax. The rates vary based on the type of income you get.

The Philippines government categorizes income as compensation, income subject to final tax, and other income. Paycheck income is taxed at rates ranging from 20% to 35%.

The majority of income subject to final taxes is passive income. This has a maximum rate of 20%. Again, this is only applicable if you work in the Philippines. If you intend to retire altogether, the Philippines government will not tax any income from a pension, 401(k), individual retirement account (IRA), or other kind of retirement plan.

How to Retire in the Philippines as a Foreigner: A Comprehensive Guide
El Nido, Palawan

Safety in the Philippines

The Philippines can be dangerous in some places despite its breathtaking landscapes. one of the most recent advisories the United States was issued due to crime, terrorism, and a measles epidemic, the State Department advised Americans to exercise “increased caution” in 2018.

Travelers were specifically warned not to visit the following places, according to the memo:

  • Sulu Archipelago, including the southern Sulu Sea
  • Marawi City in Mindanao
  • Other areas of Mindanao

You should, in any circumstances, read the State Department’s Crime and Safety Report for the Philippines.

Final Thoughts

You don’t need to be rich to be able to live comfortably in the Philippines. You will, however, need sufficient funds. When done correctly, retiring in the Philippines can be a fantastic retreat. You’ll find that overall, products and services are less expensive than they are in the United States.

As long as you retire near hospitals, you can also get reasonably priced healthcare. However, some areas lack funding and infrastructure. As a result, it’s unlikely that you’ll find easy access to healthcare in these places. Threats of terrorism are present in certain locations with high crime rates. So make sure that you double-check the safety of the location you intend to stay in. Moreover, if you can find the right spot, you can take full advantage of the Philippines’ natural beauty, which ranges from sandy beaches to colorful rural parts of the country where you can truly escape.

Tips for Retirement Planning

  • If you want to retire abroad, whether in the Philippines or anywhere else, I strongly recommend that you discuss your choices with a financial advisor. Finding a qualified financial advisor does not need to be difficult.
  • Use this calculator to see how much money you’ll need to save in order to be able to withdraw a certain amount each month throughout your retirement.

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Polly Amora is the señorita behind GoldenIslandSenorita.Net and the general manager of a privately-owned company in Manila, Philippines. She is a lifelong learner who is very outgoing, speaks four languages, is loud and outspoken, and loves to have adventures in the mountains, on the beach, and in the city. You can throw her anywhere, and she'll handle it like a pro. Ice cream and beer are two of her weaknesses.