Home / Business and Economic News / How rich is rich in the Philippines?

 
Stocks, Mutual Funds, Forex, Finance Philippines

Who are considered “rich” in the Philippines?

For starters, you’re “rich” if you belong to the list of the Top 10 Richest Filipinos. However, even if your net worth does not run into billions of pesos yet, you may still be considered “rich” as per the definition of the National Statical Coordination Board (NSCB).

Based on NSCB computations using the Family Income and Expenditure Surveys (FIES) and the Labor Force Survey (LFS), a family in the Philippines must earn at least PhP 2,393,126 a year or PhP 199,927 a month to be counted as part of the high-income class in 2010.

Simply stated, your family should be earning P200,000 a month or P2.4 million a year to be considered “rich” in the Philippines.

The Rich, the Poor and the Middle Class

Rich people are indeed a rarity, with rich families numbering only 20,000 or 0.1% of the total 17.4 million families in the country.

The middle class, on the other hand, earns an average of P36,934 per month.

The low income class earns an average of P9,061 per month.

Predictors of Wealth

Stocks, Mutual Funds, Forex, Finance Philippines

The NSCB also identified three predictors that are consistently significant for the high income group. These are:

  1. household head working as corporate executives, managers, managing proprietors, supervisors, officials of government and special interest organizations;
  2. owns at least three air conditioning units; and
  3. owns at least three cars / vehicles

This means if the household head is a top executive or business owner or a politician, the family owns at least 3 cars, and their house has at least 3 aircon units, then that family is most probably rich.

Breakdown of Family Expenditures

All families regardless of income spend more on food and rent/rental value of their house.

Food expense of high income families, however, represent only 21% or one-fifth of total expenditures while for the low income families, this is 53.4%. This shows that the poor spend half of their hard-earned money on food.

For the high-income families, their top 3 expenditures are:

  • Food – 21.1%
  • Housing and shelter – 16.6%
  • Transportation and communication – 12.5%

Middle-class families share the same top expenditures, although their spending has a different percentage compared to the high-income families:

  • Food – 34.8%
  • Housing and shelter – 13.9%
  • Transportation and communication – 9.8%

Low-income families do prioritize spending on the basic essentials, such as food, housing, and utilities such as fuel, light and water:

  • Food – 53.4%
  • Housing and shelter – 10.7%
  • Fuel, light and water – 7.7%

Top Expenditures of Filipino Families

Expenditure ItemHigh IncomeMiddle IncomeLow Income
Food21.1%34.8%53.4%
Rent/rental value of occupied dwelling units16.6%13.9%10.7%
Transportation and communication12.5%9.8%5.3%
Fuel, light and water5.6%7.7%7.7%
Taxes5.4%  
Education 5.9% 
Personal Care and Effects  3.9%
Others38.8%27.9%19.0%
Total100.0%100.0%100.0%

Now that you know who the rich and poor are in the Philippines, where do you categorize yourself?

Source: NSCB

You should also read the following:

Topic Summary Keywords:

how to be rich in the philippines, how to get rich in the philippines, rich in the philippines, how rich is the philippines, rich philippines, what is considered rich in the philippines, how to become rich in the philippines, rich, philippines rich, middle class in the philippines



Like this article? Please LIKE, SHARE or TWEET!