Retirement by the Beach
If you like beautiful beaches and fresh seafood at unbelievably low costs, you might consider the Philippines as a potential retirement destination. The island nation—there are actually 7,641 islands in the Philippines—is famous for its tropical weather, oceanfront property, and easy access to the rest of Southeast Asia. But before you dive in, see what you'll need to do up front to prepare to spend the rest of your days on the beach.
- The Philippines has become a retirement destination for expats due to its pristine beaches and low cost of living.
- The visa process relies on having a regular income, but Social Security payments can be applied to that qualification.
- Healthcare access and safety concerns are real issues that should be considered.
A Paradisaical Retirement
The good news is that the Philippines will welcome you with open arms. The government even has a special section of the tourism department to help you get settled as a retiree. The Philippine Retirement Authority provides assistance throughout your stay.
English is a widely-spoken second language; in fact, the BBC reports that teaching English is a major industry in the Philippines, which houses many call centers that serve U.S. businesses.
You can do initial research at sites such as RetiringtothePhilippines.com, where you will find information about what it is like to live in the country.
Traveling to the Philippines and spending some time there should definitely be part of your planning process if you've never been before.
Cost of Living
The Philippines is one of the top 25 best places to retire on International Living's 2018 Global Retirement index.
Here's how the website Numbeo breaks down the costs to live there as of April 2020: Rent is $174.08 per month for a one-bedroom outside of a city center to $310.19 per month in a city center; dining out for two at a mid-range restaurant, $15.75; utilities, $129.01 per month including air-conditioning; and Internet, $45.82 per month.
The one big-ticket item: gasoline. At roughly $3.86 a gallon, it can get very expensive to own and drive a car. But as long as you choose to live in a city, a car is not essential. Taxis, buses, and bikes will take you where you need to go.
Getting a Visa
Once you have committed to retiring in the Philippines, the first thing to do is apply for a Special Resident Retiree's Visa (SRRV).
The most popular variety is the SRRV Classic. As long as you are 50 years or older, the visa requires you to deposit into a bank in the Philippines either $10,000 if you have a guaranteed monthly income or $20,000 if you don't have a regular stipend. This deposit covers the retiree and two dependents.
The good news: The $10,000 can be used toward the purchase of a condo or townhouse, or for a long-term lease. However, in order to use the $10,000, the total value of the property in the Philippines must be at least $50,000.
If more than three of you will be moving to the Philippines, there is an additional $15,000 per dependent. You will need to show proof of income, which must be at least $800 per month for a single applicant or $1,000 per month for a couple.
Social Security income counts as a pension for this requirement. The annual letter you get from the Social Security Administration stating your benefit amount is sufficient proof.
The initial application fee is $1,400 for the principal and $300 for each additional person, including spouse and dependents. This is a one-time payment. After the first year, the annual fee to renew the visa will be $360 and will include the principal, spouse, and one child. If you have more dependents, they will cost $100 each.
Other types of SRRV visas are available for people looking to move to the Philippines at a younger age. There is also a special retirement visa for former diplomats.
In addition to a visa, you will also need to get an ACR I-card. (ACR stands for Alien Certificate of Registration). It has a microchip, contains biometric data, and has a photo, your visa type, and other information like your fingerprints. It costs $50, has to be renewed annually, and serves as a re-entry permit.
However, it is not a substitute for a valid passport with a visa stamp. You need those too.
As noted, you must have a regular retirement income to qualify for the SRRV Classic Visa, and Social Security income does count. In fact, the Philippines is one of the countries that has U.S. Embassy staff trained to help you with Social Security services.
While you can have a check sent to the Philippines and pick it up at the embassy, you are much better off maintaining a U.S. bank account into which your benefit can be deposited directly. You can then transfer funds to a Philippine bank. Even better, you can get a direct deposit of your Social Security check sent to a local bank account.
Choosing a Location
Finding the best place to live is a highly personal choice. There are 81 provinces and 146 cities in the Philippines.
Some have more appeal than others. The website Top-Destination-Choice-The-Philippines.com lists the top 20 cities in alphabetical order. Cebu City is the only city on the list with a Joint Commission-accredited hospital.
If you choose to live a distance from an accredited hospital, be sure to have access to transportation that can get to the hospital quickly. Many rural clinics do not have a doctor on staff, only nurses.
You Can Rent, but Not Always Buy
Renting with short-term leases may be a good option for you until you find just the right place to live. The problem will arise when you decide you want to buy something.
If you are retiring on an SRRV visa, you can buy a condo or townhouse, but not a fully detached house. That sort of real property can only be bought by a Philippines citizen.
Buying a townhouse or condo in the Philippines is similar to buying real estate in the U.S. The real considerations are location, location, and location. While you may dream about living on a small island, think about whether it will give you easy access to malls, grocery stores, hospitals, and other modern conveniences.
This is another reason to rent before buying in communities you are considering.
Healthcare can be a more difficult issue to resolve. Medicare does not pay for care outside the U.S., though some Medicare Advantage plans do. They vary on a state-by-state basis, so research your home state to find out if that option exists for you.
On the plus side, medical services cost much less in the Philippines.
Don't be surprised if you are asked to pay for medical care at the time you receive it. If you are eligible for Veterans Health Administration medical care, you can seek out a U.S. VA clinic in the Philippines.
Modern medical facilities with Joint Commission International accreditation are available in only five cities. Some U.S. retirees travel back to the States if they encounter major medical needs. You don’t lose your Medicare when you are outside the U.S.; you just can't use it to cover services unless you have arrangements through a Medicare Advantage Plan.
In making plans, retirees should also be aware of the recent increase in violence in the Philippines, resulting from the campaign against drugs launched since President Rodrigo Duterte came to office on June 30, 2016. The campaign has reportedly resulted in reportedly more than 12,000 deaths.
There are other security issues, as well, with some regions of the Philippines posing a greater risk than normal because of continued violence linked to insurgency and terrorism. Recent reports specifically cited the Sulu Archipelago, the island of Mindanao, and the southern Sulu Sea area.
Other regions in the Philippines are generally considered as safe as other places in Southeast Asia. Anyone thinking of traveling to or retiring in the Philippines should review the most recent U.S. State Department Philippines Travel Advisory.
The Bottom Line
You can definitely retire more cheaply in the Philippines, but you will face different kinds of problems, such as limitations on purchasing a residence if you are not a Philippine citizen. You also may not be able to access the type of healthcare you want. And you need to be aware that some regions are currently considered unsafe.
The good news is that you will find a welcoming government that will encourage you to choose the Philippines as your retirement destination.
It makes sense to take several vacations there at different times of the year before making the final decision to relocate.