How to Create A Budget to Match the Cost of Living in the Philippines

July 5, 2019

Budgeting is an essential part of money management wherever you are in the world and its important to make sure you consider the cost of living. This can vary from place to place and a restaurant meal in New York in London will generally be a lot more expensive than dining out in parts of the Philippines. Conversely, health care is not free at the point of service for expats, so you will need to take this into consideration, especially if you are coming from a country where healthcare is subsidised by the government. With these and other factors in mind, we decided to create a quick guide to budgeting in the Philippines.

Food

For most of us, this makes up a large part of our monthly budget, but overall, you can expect to pay far less for what you eat in the Philippines than you would in Europe or America.

Eating Out

This part of the world is famous for its fine food and dining out here is always a great experience. Many people who emigrate to the Philippines are surprised at how cheap it is when compared to their home country. A meal for two in a mid to high end restaurant will generally be around 15 to 20 dollars for two people. Snacks and street food cost even less and you can expect to pay around 3 dollars for things like McDonalds or other fast food.

Groceries

Though many things are much cheaper than you would expect, there are some surprisingly high-priced items on the shelves in the Philippines. Milk is around 5 dollars a litre and cheese can be between 2 and 3 dollars per pound. To compensate for this, eggs, vegetables and meat is generally around the same price, if not slightly cheaper than it is in the UK, Europe and the USA. Alcohol can be much cheaper, especially if you enjoy the domestic brands of the Philippines. A bottle will cost less than a dollar, sometimes under the half the price of the imported alternative.

Summary

Allow significantly less than you would when shopping and eating out at home but remember to account for the occasional higher priced item.

Housing

The housing market in the Philippines is competitive, but not to the extent it is in some other countries. Affordable property is often of a decent standard and though some regulations are a little different, even those with a modest income can expect to be able to live somewhere with more than adequate facilities.

Renting

Many people in the Philippines rent, rather buying, especially in larger cities. For a small to medium sized one-bedroom property in or close to a city, you can expect to pay under $300 dollars a month. If you prefer to live somewhere a little more rural, you can enjoy a rate of around half that amount. A 3-bedroom house in the any of the Philippine’s cities is as little as $550 per month and around $350 in the countryside. Considering this would barely get you a room in a shared in house in London, L.A or Paris, most people who are considering renting somewhere in the Philippines can expect a huge reduction in their monthly spend.

Buying

Property is sold in square feet in the Philippines, which means the larger the property you buy, the more you can expect to pay. There is also some variation depending on the location. As with renting, city-based properties command a much higher price than rural locations. A city centre apartment will cost $165 per square foot (as of 2019) and it will be around $95 for buildings in smaller towns or villages. Buying property in Philippines can be quite a complex process for expats, so may choose to rent as an alternative. As the cost is so cheap, most can afford to live in comfort and enjoy a few little luxuries, too.

Summary

Unless you are intent on buying somewhere, you can expect to pay much less for your accommodation than you are used to.

Transport

Public transport costs are a tiny fraction of the price that expats are used to paying. 20 cents will get you a one-way ticket to most city destinations and travel for a full month can be under ten dollars. Taxi cabs are cheap, too at less than a dollar a mile. Gasoline is around 4 dollars and cars themselves cost around the same as they do in the UK or the U.S.A.

Bills and Utilities

Internet and TV packages are about the same, if not a little higher than they are at home for expats and you can expect to pay around 45 dollars a month for a high-speed connection. Bills for things like electricity, water and heating are also similar at around 120 dollars per month for a medium sized apartment. This is part of your budget that should largely remain the same as if you were living in your home country. If you find that you are allocating too much, you can always use it for things like entertainment and leisure.

Entertainment and Leisure

Trips to the cinema are quite cheap at under five dollars per person. Sports clubs are also very reasonable at less than five dollars per hour. Monthly gym fees are around 30 dollars per month and subscription packages to streaming services such as music or gaming will be like elsewhere in the world.

Summary

Even those with a low income will be able to enjoy a comfortable day to day life on a small monthly budget. As the average salary in the Philippines is around $300-400 dollars a month, most people will notice a significant difference in terms of what they can afford when compared to the cost of living in places like the UK, Europe or the USA. Those who are considering retirement or who have built up some savings can expect to live a very comfortable lifestyle for a fraction of the cost they would expect elsewhere.