From the Midwest redneck author of "The Rooster Crows at 4am!," "Lizard Poop!," and "The Philippines Expat Advisor"
We’re Living Below the US Poverty Level in the Philippines
My wife and I are living below the United States poverty level of $15, 130 a year for two people. Now if we were not living in the Philippines, that would be a problem. While we are enjoying a comfortable lifestyle we certainly are not living like a king and queen, but we're content. (Yeah, I know the photo has absolutely nothing to do with this topic, but what would you rather see, a mugshot of an old geezer like me, or this cute Filipina on the beach?)
We'll be more content when I turn 62 (less than 2 years away), and I start collecting Social Security. Our income will more than double. We'll be living like a Prince and Princess in the Philippines. But back in the States, we would be just be getting by even when Social Security kicks in.
But thanks to an article brought to my attention by Lance the Canadian, I was made aware that a growing number of Americans are also spending their retirement years in poverty.
A recent Employee Benefit Research Institute study, as reported on Yahoo!Finance from US News & World Report, stated that the proportion of older people living below the poverty line has been growing steadily since 2005. Many of those folks are falling into poverty as they age and spend down their savings.
Poverty rates for those 65 to 74 climbed 7.9 percent in 2005 to 9.4 percent in 2009. For older retirees ages 75 to 84, the study reveals an even steeper increase from 7.6 percent to 10.7 percent.
It's the oldest retirees who are the most likely to live in poverty: 14.6 percent did so in 2009. Many older Americans are falling into poverty as they age. In 2009, the most recent year to be included in the study, 6 percent of those age 85 and older were new entrants in poverty, up from 4.6 percent in 2008. And while 3.3 percent of people ages 75 to 84 fell newly into poverty in 2005, that number increased to 5.6 percent by 2009.
The article goes on to reveal that one of the biggest drivers of poverty in old age is failing health and the associated medical costs. Most retirees living below the poverty line (70 percent) have suffered acute health conditions such as cancer, lung disease, heart problems, or stroke, compared with 48 percent for those above the poverty line.
Almost all senior citizens living in poverty (96 percent) have some sort of health condition, such as high blood pressure, diabetes, psychological problems or arthritis, versus 61.7 percent of retirees with incomes above the poverty line.
"Medical expenditures go up for the elderly as they age and medical expenses have been rising over the past decade very rapidly," says Sudipto Banerjee, a research associate at EBRI and author of the report. "A lot of people have to move to nursing homes, and nursing homes are very expensive. People who live there, they lose their income and assets very quickly."
Many people also spend down their retirement savings too quickly, especially during recessions. "As people age, personal savings and pension account balances are depleted," says Banerjee. "Also, the rising poverty rates noted correspond to the two economic recessions that occurred during the last decade. I would expect that as the economy does better, the rates will go down."
Once you have spent your nest egg, your only remaining source of income is likely to be Social Security. I was fortunate to have a good paying job at AT&T, my employer of almost 30 years, and thus will have a decent income from Social Security since payments are based on your earnings during your 35 highest earning years in the workforce.
A recent post I did, "More Older Americans Working, Why Not Retire to the Philippines?, along with this latest report, makes me believe that my asawa and I made the right decision in moving to the Philippines.
Now as the article reported, more health issues occur as we age. If you're considering a move to the Philippines and already have some medical problems, you might be concerned about the quality of health care you would receive in the Philippines versus the United States. That's a legitimate issue that I'll be exploring in a future post.
I will report that my wife and I have had occasion to visit different hospitals and health care clinics while residing in the Philippines. We have found them to be on a par with facilities back in the States for the most part. I'll get into more detailed information and what possible health insurance options are available to you in that aforementioned future article.
But why not consider retiring to the Philippines? Think you can't do it? My eBook, "Expat Guide to the Philippines" can help. A person can live a lot cheaper in the Philippines and enjoy a good quality of life. Again, I'm glad we made the move. If you want a fresh start in life, come on over. I can guarantee, you won't be bored. It's an adventure.
Dave,
I don’t know why more people don’t look into retiring to the Philippines rather than struggling to survive in the states. Thats a no brainer. I couldn’t live like that, having barely enough food to live on. I guess its there loss. Have a nice day.
I don’t understand it either, Papaduck. But thanks to my friend Senor Frog, we might be having another senior come over. Mr. Frog received a comment on his website from a 62-year-old man looking to retire to the Philippines and sent him over to my website, also. The gentleman is considering Iloilo and Guimaras as one of the places he may live. Folks are missing out on a great retirement place by not considering the Philippines.
Really like the new set up on your website….very user friendly….was roaming around on the internet…..an came across a young lady named …Fuko….do you know if she is a local Philipine girl…..Also do women there…rather be called ….Filipina or Pinay
Thanks, Ralph, I’m glad to hear that. I appreciate the feedback.
Don’t know of anyone named Fuko, Ralph. Asked my asawa which is the preferred term, Filipina or Pinay? Either one is OK for her, she said it doesn’t matter.
Oops … I found out Fuko….is Japanese…But maybe she will visit the Philippines
Dave,
Happy Memorial Day to you and your asawa. I have to work so i can’t enjoy it lol.
Thanks Papaduck, sorry you have to work. I didn’t realize it was Memorial Day back in the States until I talked to my Dad last week. He lives in Vegas and was mentioning how bad the traffic would be with Californians coming in for the long weekend. Every day is a weekend for me.
Making the move here was a no brainer for me. The wife and I were both working full time plus I had my R
hi dave,yesterday while waiting for my flight to the ph at LAX i grabbed a tuna sandwich that was prewrapped at a food outlet at the airport and when i went to pay she says thats $9.95,and i was shocked and told her i cant pay that for a frickin sandwich and i put it back and went somewhere else,Mc Donalds.
hey again,i am sittin in terminal 2 at naia,see ya soon
Yep, I can’t figure out why more folks don’t make the move over here. Cheaper to live, great people, great place to live.
Ten bucks for a frickin’ tuna sandwich, Scott b. That’s just nuts!
Good to have met you, Scott b. Glad you had a safe trip. Looking forward to you meeting the gang over at Langford Place. And welcome to the start of the rainy season.
I think the main reason many more Americans don’t choose the RP as a retirement destination is the distance from the U.S. mainland. Many have family and friends that they just can’t part with. Many others who do wish to leave the U.S. look to arms-reach places like the Dominican Rep., or Costa Rica, and even Mexico. It is still cheaper than the U.S. and easier to commute back and forth more readily especially if one has medical issues.
Good point, Randy. Makes sense. I should have thought of that, but it never crossed my pea brain. Thanks again for some good info.
I am curious that you are living below the US poverty level but expect that to improve when SS kicks in. After 30 years with AT&T do you have a pension?
Hi Mark. Instead of taking my pension with AT&T when I retired with almost 30 years of service, I opted to take my pension in a lump sum payment. I invested that lump sum in an T-72 IRA account. The account gives us a fixed monthly amount. The T-72 cannot be broken for five years. In about 2 years we will have fulfilled the 5 year requirement and will have access to the T-72 account without the huge tax penalties we would occur now if we “broke” the T-72 agreement. Fortunately, even with the recent stock market slide, we still have substantially more money than what we originally invested, and it continues to fund our fixed monthly income.
My guess is due medical health facilities in rural Philippines. As you age, medical issues are of primary importance. Living in big towns and cities with excellent medical and health facilities is more expensive than living in the provinces like Iloilo or Marinduque
Great to hear from you, David! And I agree with your statement completely, sir. We had to visit a doctor in Iloilo yesterday, not one of my favorite things to do. More on that story later. Appreciate the remark, take care.
Question if a man from Europe was to marry and live in the Philippines with a nice Philippina Lady and they had their own Home / House what money would they need to live comfortably their per month including all Bills No Car needed and if they were to go out 2 night in the week ???? Cheers say Cebu by or near the Beach ????
Only you can answer that question Dave. I know one man living on 500 dollars per month and others where 2,000 US dollars isn’t enough. Rent first. Then check the cost of a house. You will most likely want to live close to where your wife grew up as she will want to be close to her family. Just not too close to her family.
Good answer, Gary. Everyone has different lifestyles and location also factors into the monthly cost. Always good advice to not live too close to the relatives. Most of us expats living in the Philippines know that close proximity to the relatives can mean some folks looking at you like you have “ATM” stamped on your forehead. Thanks for the input, Gary.
I just heard a report on TV that stated American wealth has declined almost 40% from 2007 to 2010. The combination of loss of homeowners equity, portfolio losses and loss of income all contributes to more people living below their previous standard of living and many of them at or below the poverty level. Personally, I can’t see it getting much better any time soon…IMO. http://www.foxbusiness.com/economy/2012/06/11/home-prices-weigh-on-american-wealth/
I agree with you, Randy, that’s why my asawa and I plan to stay in the Philippines. Thanks for the info.
As long as the cost of rice, fish, and Pale Pilsen remains reasonable, I’m there!
Randy, I just hope the new proposed “sin tax” bill here won’t drive up the cost of Pale Pilsen too much.
The bill hasn’t been passed yet, right?
I believe it’s going to the Senate, Randy. Hasn’t passed yet.
As a drinking and smoking society, there will be a lot of pressure on both sides of that issue. I no longer smoke but for the sake of my SMB pleasure, I vote Nay!
I second that “NAY” vote, Randy!