What’s ideal monthly income for family of 4?

MANILA, Philippines – A Filipino household of 4 should have a gross monthly income of P120,000 to live a “simple, comfortable life,” which entails owning a car and a medium-sized house, traveling occasionally, as well as sending 2 children to college, a survey conducted by the National Economic and Development Authority (NEDA) showed.

During a media forum on AmBisyon Natin 2040 (a word play of “ambition” and “vision”), outgoing NEDA Director-General Emmanuel Esguerra said an overwhelming majority (79.2%) of Filipinos aspire for a simple, comfortable life.

“While 16.9% of the surveyed Filipinos want affluent life, and the remaining aspire for the life of the rich,” Esguerra said in a media briefing.

A “simple, comfortable life” means having enough money for day-to-day needs, owning a medium-sized home, owning one car, educating two children until college, taking occasional trips around the country, and relaxing with family and friends.

The cost of having a “simple, comfortable life” in the Philippines is premised on having a comprehensive tax reform program. 

Esguerra clarified that NEDA’s AmBisyon Natin 2040 study is made to serve as a vision for the Philippines by 2040.

“This is not meant to be prescriptive. This is just saying where Filipinos want to go, and the trade-offs. This is a vision,” the outgoing socioeconomic planning chief said. 

“Since our soft launch in March, we have been exploring possibilities of putting insights from here to the legislative in Congress,” Esguerra added.

A strong income growth needed

For NEDA Deputy Director-General Rosemarie Edillon, it will be easier for Filipinos to achieve this as long as the economy continues to grow.

“If we grow like we did in the past, we will achieve this. But if not, majority of the Filipinos will not be able to achieve this,” Edillon said in a forum organized by NEDA and the Economic Journalists Association of the Philippines in Pasig City.

The P120,000 gross monthly income will translate to about $11,000 per capita income, which in turn would eliminate poverty in the Philippines.

“The Philippines will be able to eradicate poverty should it triple the per capita income over 25 years,” Edillon told reporters.

“Malaysia was able to achieve a 0.6% poverty rate with an $11,120 per capita income after 33 years,” she added.

With the right policies, the NEDA official said the Philippines can be nearly a high-income country by 2040.

Citing the Asian Development Bank, Esguerra said that by nearly doubling Asia’s share of global gross domestic product (GDP) to 52% by 2050, the region would regain the dominant economic position it held some 300 years ago before the industrial revolution.

“Unfortunately, the Philippines was barely part of it. The Philippines was classified as slow- or modest-growth aspiring country,” Esguerra added.

“Poverty reduction, inclusive growth are not 6-month projects,” he said.

2040 vision recognized by private sector

“Experts and analysts before said our economy was like a jeepney – easily overtaken and very inefficient. But now, we are no longer in a survival mode. Today, we can start to vision. Our economy, to some extent, is now matured,” Bank of the Philippine Islands chief economist Emilio Neri Jr. said during the media forum.

Neri said the Philippines can achieve this 2040 vision should the public and private sectors work together in setting up policies and economic reforms for everyone.

Guillermo Luz, private sector co-chairman of National Competitiveness Council, echoed his remarks saying “the wish of the private sector  can turn into a reality should the public and private sectors collaborate.”

“For sure, we are going to need constant research over 25 years. This requires a great deal of patience and perseverance. We all need to fully understand the value of implementation – its nuts and bolts,” Luz added.

Esguerra said his team has “informally” presented the AmBisyon 2040 study to incoming NEDA chief Ernesto Pernia.

“If we were to go by what we’ve also read from the papers prior to the Davao summit, there was a statement that came out from the incoming President’s economic team, which said that the economic agenda is not a standalone thing, but will be guided by AmBisyon Natin 2040 and the Philippine Development Plan,” Esguerra told reporters. – Rappler.com