Saturday, August 25, 2018

The Philippines: Best Place in the World to Retire

Got this from an online forum. Credits to the owner.

It's been a few months since Infinity War was shown, and yet memes about Thanos landing in the Philippines keep on coming. This one is extra funny because it's financial life related. Sure, the Philippines is the best place in the world to retire---if you're coming from the third first world and actually have the benefit of a 401k, a retirement package or a pension coming from your employer. 

Tropical third world countries in general come up top as the best places for (usually) white people to retire in because for one, winter is tough for old people. Got to keep them bones and achy joints warm. Two, their euro/dollar/etc go very far in our shores. Like what my aunt used to tell her foreigner husband: lets go back to the Philippines and you'll live like a king. True enough. They get to live in a condo with the supermarket and all the possible amenities nearby. They get vacation time for weeks and months on end. They get relatives who live nearby to run some of their errands. What's not to like? 

But if you're Filipino, retirement in your own country sounds like a scary idea. You can't even run off to other third world countries unless you have saved up and really prepared for your retirement. One option though is to move to the provinces where the quality of life is better compared to Metro Manila. In the city, traffic and air pollution will probably be bad for aging lungs---or just plain bad for everyone, period. If you own land in the provinces, you can probably garden and grow some of your own food. Bonus points if you have relatives in the area to keep you company and to help out, just in case. The one drawback is probably that healthcare is concentrated to capital city hospitals. Can't say much about the state of healthcare in the provinces, but the sheer distance from barrio to the city is going to be worth an hour's travel at least? A compromise could be worked out though: live in the provinces, but choose places where a good hospital is within a reasonable travel frame. If an emergency comes up, god forbid you don't want to be trapped in an island with no ferry to the mainland. 

Prospects about my own future retirement are scary. For one, you really can't depend on the government pensions to fund your old age. My mother's pension from the SSS is a measly Php1,200 per month--granted that she stopped working after my siblings were born. She gets this Senior Citizen Fund of Php5k per year. So that's not really much and us siblings have to pick up the slack for whatever's left. This is how most Filipino families take care of their older members. 

I really hope this changes and there's more awareness about preparing for retirement with people my age and younger. Because we can't keep on going on like this. Just the news of the SSS hiking pensions again will mean that the fund life will be cut to 2026---there really won't be anything left decades before I (and my cohort) will be ready to retire. 

The message really seems to be: don't depend on anyone for your retirement. Not the government, not your children (if you have any). Because unlike Thanos, we don't have Infinity Stones and the Banaue Rice Terraces to fall back on. You're the only one responsible for your own future self. So do yourself a favor and prepare for your old age now. Don't buy unnecessary stuff to show off. Stash part of your income in a fund--mutual, stocks, VUL, PERA, pension funds---do it now. Your future self will thank you. 

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