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Is PHP 1 MM / yr = Upper Middle Class
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If a person has an annual income of 1.1 million Philippine Pesos, and lived in Manila, Cebu City or Davao, would they be considered poor, comfortable or upper middle class?
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Depends on the regions– In Mindanao, you would be considered upper middle class. In Cebu, you would be considered merely comfortable. In Manila it varies even more. Houses owned are worth 1.1. k pesos or more in the said area/region, and that would leave you with an annual cost of living /household annual income and expenditures worth as /categorized by : Distribution of Socioeconomic Classes [According to Annual Household Income] A B PHP1,857,000 (upper class and upper middle class) C PHP603,000 (middle class) D PHP191,000 (middle lower class) E PHP62,000 (lower class) (The above are from relevant reports that can help define the income classes such as: The latest “Family Income and Expenditure Survey” (FIES) of the National Statistical Coordination Board (NSCB) offers some, albeit not that exhaustive, information about income classes in the country. However, instead of dividing the Philippine population into Classes A, B, C, D or E, the NSCB simply grouped the country into three segments: the high income, middle income, and low income groups. High income segments are families or people earning an average of P200,000 a month or P2.4 million a year. Thus, they may be described as the “rich” segment. They are very few, numbering only 0.1% of total families in the Philippines. The middle income class is said to earn an average of P36,934 per month while the low incomesegment earns an average of P9,061 per month. It is good to know that the FIES report has those details, unfortunately, it is still not detailed enough. For example, if a family’s monthly income is around P80,000 — can this be considered high income or middle income? What if the monthly income of a household is P20,000 — is this middle or low income? Simply speaking, we want to know: When can we say if a family or a person belongs to the high income, middle income, or low income class? The FIES report does not provide a concrete answer. Population Percentage: Classes A, B, C, D, E Another research we found that attempted to determine the number of Classes ABCDE in the Philippines is the 2011 report published by polling firm Social Weather Stations (SWS) entitled “Family Income Distribution in the Philippines from 1985 to 2009”. This report offered insights regarding income classes but was also silent on the actual description of each class. Still the report is useful for those interested in knowing how many in the Philippine population belongs to Classes A, B, C, D or E." ) [Data from the report are summarized in the abovementioned table. Gleaned from an online site, Pinoy Money Talk.]
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If you earn Php1.1 million (roughly $24,000) a year, that means you earn around Php100,000 or $2,000 a month. Let's see what you can get for $2,000 a month. I can only vouch for Manila, especially Makati area since I lived there for many years. Assuming you live alone, you can get a 1-bedroom condo for around $700. Another $500 for utilities, food, transportation, etc. I would say this is pretty comfortable. If this income is for two people, you can still live in a 1-bedroom condo but your budget for utilities, food, and transportation will slightly increase, so this is still good. However, if it's for a family with a kid, this won't be enough because you have to update to a 2-bedroom condo, pay for a nanny, put your child to school (and Makati schools aren't cheap), and your child has their own supplies. This income, by PH standards, is upper middle class, but not in Makati. If you go to Iloilo, you will have a very comfortable lifestyle and can easily raise a family comfortably with this amount.