That’s us, by the way. We’re P and J, and if you’re new here, this blog is about our FI journey — figuring it out as we go and sharing what we actually learn along the way, the good and the bad.

We landed in Clark, Pampanga — a small economic zone next to Angeles City, about two hours north of Manila. Clean, organised, and quite safe by Philippine standards. No beach, and the crowd is a mix of golfers, casino regulars, and a surprisingly large Korean expat community with more Korean restaurants than you’d ever expect to find in the Philippines. For everyone else it’s pretty quiet, which honestly suited us fine when we were heads down building the business.

If you’re thinking about setting up a business in the Philippines, this post should give you a realistic picture of what it’s actually like — the business side, the people, the lifestyle, and what it meant for our FI progress.

Why Clark?

The Philippines has genuinely high English proficiency across the country, which is a big part of why it became such a dominant outsourcing hub in Southeast Asia. Manila and Cebu are the biggest and best-known cities for that kind of work, so you’re probably wondering why we ended up in Clark of all places.

Honestly, two things. We had friends already living and building a business there, and when you’re moving to a country you’re still figuring out, having someone you actually trust on the ground is everything. We’d also been to other parts of the Philippines before and, look, it didn’t go great. Dodgy food, some questionable characters — we were probably just naive and didn’t know what to watch out for at the time. Clark had a reputation for being a different kind of place, and our friends backed that up. It felt manageable, stable, and had enough going on business-wise to actually build something. What we didn’t expect was just how much we’d learn — about business, about people, and honestly about ourselves — once we were actually living there.

The Outsourcing Reality Nobody Talks About

And Clark, it turns out, is absolutely packed with outsourcing companies. Business Process Outsourcing is one of the Philippines’ biggest industries — the country consistently ranks as one of the top outsourcing destinations in the world, and when you’re on the ground there you can see exactly why. English proficiency is high, the workforce is young and hungry to work, and the labour costs compared to Australia are honestly kind of shocking at first. A BPO worker in Clark typically earns somewhere between ₱15,000–₱30,000 a month, which works out to roughly AUD $400–$800. For the roles we were hiring for, that’s a fraction of what we’d have paid back home.

That gap is exactly what drew us there in the first place, and look — it’s real, it works, and we’re not going to pretend otherwise. But what we didn’t expect was what came next.

What We Chose to Do Differently

When you hire people at salaries that feel shockingly low compared to what you’re used to, you have a choice. You can extract maximum value from that gap and move on, or you can think a bit harder about what you’re building and who you’re building it with. We chose the second option — not out of guilt, but because it made sense to us as people and as business owners.

Filipino workers, in our experience, are genuinely warm, loyal, and hardworking. But the working culture — especially in the BPO world — can default to long hours, high turnover, and not a lot of investment in the actual human doing the work. Coming from Australia, where we’d experienced a workplace culture that actually values work-life balance and professional development when it’s done well, we wanted to bring some of that with us. So instead of saying “work harder, work longer,” we invested in our team. We taught them how we think about work, talked about efficiency over hours, created a workspace that felt respectful rather than transactional, and tried to show — not just tell — what a sustainable working environment looks like.

Did it take longer to get things running smoothly? Yes. Did we misread cultural cues more times than we’d like to admit? Absolutely. But we’re genuinely happy about the people we worked with and the relationships we built. That part we wouldn’t trade.

The Harder Parts

Let’s be honest about the challenges, because anyone considering geo arbitrage in the Philippines deserves a clear picture.

Safety and crime first. Clark is safer than many parts of the Philippines, but you still need to stay switched on. Petty crime, scams, and occasional more serious incidents are part of the reality in some areas. Food quality and clean water were trickier than we expected too. The Philippines has incredible food, but food safety standards aren’t always consistent outside well-established places. We didn’t drink tap water (even filtered) the entire time we were there. These things sound small but they add up to real lifestyle friction, especially when you care about your health and training.

Speaking of training — we’re both active people, and building a routine that actually worked took time. The heat and humidity are no joke. We figured it out eventually, but it required genuinely understanding the environment before we could work with it rather than against it. The cultural side was probably the most nuanced challenge. Filipino culture is warm and relationship-focused, which is wonderful, but there are communication dynamics around hierarchy, around saying no, around how feedback lands, that are genuinely different from what we were used to in Australia. Managing people effectively meant understanding their behaviours first, not just their skills.

The FI Milestone We Hit There

Here’s the part that made all the friction worth it. During our time in Clark, we hit our first major FI milestone. We reached what we consider our lean FI point — the number where, if we stripped things back, our investments could theoretically sustain us at a basic level. It wasn’t the full, comfortable FI we’re still working toward, but it was the first real proof of concept that told us this is working, keep going.

Geo arbitrage was a meaningful part of that. Running a business with a lower cost base in the Philippines while investing the difference back into our portfolio accelerated our timeline in a way that would have been very hard to replicate staying in Australia. Every year we were there, our goals shifted a little. What we wanted from life became clearer. What we were willing to tolerate became narrower. And our vision of what “enough” actually looks like got sharper.

Why We Left and What Comes Next

The Philippines wasn’t home for us long-term. Not because it’s a bad place — it genuinely isn’t — but because the lifestyle we want going forward didn’t match what Clark could offer us at this stage of life. We’re entering our 40s to 50s now, and we’re increasingly clear about what we want our days to look like: more flexibility, more freedom, more time doing things we love rather than time spent managing a business. The Philippines chapter gave us a lot, but it also clarified — through living it — what “enough work” actually means to us.

Thanks to the team we built there, both of us is now working only part-time. That’s the real payoff of investing in good people and building systems rather than just trading your own hours. We’ve since moved on and we’re currently on an island in Korea, a new chapter we’re still figuring out and will write more about soon.

What FI Followers Can Take From This

If you’re considering geo arbitrage or outsourcing as part of your FI strategy, here’s what we’d want you to walk away with.

The cost-of-living gap is real and significant. The Philippines runs roughly 60–70% cheaper than Australia in everyday expenses, and that gap, invested consistently, compounds meaningfully over time. But outsourcing only frees up your time if you actually invest in building proper systems and treating your team well. Cheap labour that turns over constantly is actually expensive. Good people who understand your business and stay are an asset.

Geo arbitrage also isn’t just about earning in a strong currency and spending in a weak one. Living in a developing country for 3.5 years changed how we think about money, security, enough, and what actually matters. That mindset shift might honestly be the most valuable thing we came home with. And it’s not for everyone, and that’s okay. It requires flexibility, adaptability, and a genuine willingness to be uncomfortable. If it doesn’t suit your life, there are other ways to accelerate your FI journey.

The last thing, and probably the most important: revisit your goals every year. Our vision of FI at the start of the Philippines chapter looked different from our vision at the end. That’s not failure — that’s just what happens when you’re honest with yourself about what you’re actually learning.

We’ll keep sharing more as we settle into this next phase. If you have questions about outsourcing, geo arbitrage, or what life in the Philippines was actually like day to day, drop them in the comments.

P & J​

Photo by Ian Schneider on Unsplash

• The FI Magic Number: In the U.S., the magic number for FI is often pegged at $1,000,000, following the 4% rule. This allows for an annual safe withdrawal of $40,000 from investments. Converted to Australian dollars at approximately 0.70 USD/AUD, this equates to roughly AU$1,428,571, yielding AU$57,143 annually. Yet, given the typically higher dividends from Australian shares, an AU$1,000,000 portfolio with a 3-4% dividend yield could very well suffice without tapping into the capital each year.

I first came across this FI concept in late 2016. It was both a revelation and a bit of a heartache. The clarity of the goal was inspiring, yet it underscored some financial choices Paul and I regretted. Had we begun our FI journey just a few years earlier, instead of dealing with the financial strain of two negatively geared properties, we might have been closer to managing a substantial share market portfolio. Still, one crucial lesson stands out—it’s never too late to start, unless you’re already at retirement’s doorstep.

A Reality Check

Discovering the successes within the FI community was enlightening yet daunting. We found ourselves in a tight spot as our property investments had depreciated, suggesting we’d face substantial losses if we sold in the current market. The potential financial setback could exceed $30,000, with more losses if we waited longer.

This prompted a frantic search for strategies to minimise losses while holding onto our properties, capitalising on Australia’s negative gearing benefits. This approach has historically yielded us annual tax returns ranging from $5,000 to $15,000, offsetting some costs associated with these properties.

Financial Breakdown of Property Investments (2019)

• • Annual expenses from two properties: Approximately $51,500, factoring in mortgages and maintenance.
  • Annual rental income: Approximately $29,000, reflective of a weak property market.
  • Tax return: Around $5,000. About $10,000 last year, with first two years peaking at $15,000.
  • Net annual cost from our pockets: Roughly $13,800 after considering the tax returns.

Our financial outgoings remain considerable, even as we diligently pay down the principal on our mortgage. Initially, we locked into a fixed-rate mortgage for a year during a period of declining interest rates—fortunately, this term is just for a year, giving us the flexibility to reassess and potentially switch to an interest-only mortgage to boost our cash flow for further investments in shares. This strategic adjustment is crucial as Paul and I reevaluate our saving and investing strategies to accelerate our journey toward financial independence and early retirement (FIRE).

Key considerations towards acheiving FI

Here are the key considerations we’ve been pondering:

1. Current and Future Spending: Living costs in the city where Paul and I reside are not the highest in Australia, but they’re far from negligible. Our monthly expenses average $4,000. With $1 million invested in a dividend-yielding portfolio, we could theoretically withdraw this amount annually without depleting the principal. In the future, we want to live in somewhere in South East Asia, this means the $4,000 is more than enough.
2. Progress Towards FI: Since shifting our investment focus to the share market two years ago, we’ve reached about 20% of our FI target. However, at this rate, full financial independence might take us nearly another decade. At 43, I’m not inclined to wait another eight years to achieve this goal. This means we need to fine side hustle to increase the inventemnt rate and to be more frugal on living.
3. Property vs. Shares: We’re grappling with whether to hold onto our properties in anticipation of future capital appreciation or to cut our losses, sell now, and funnel our resources into the share market. This decision is critical as it could significantly influence our financial trajectory.
4. Work-Life Balance: Achieving FI doesn’t necessarily mean waiting until I can fully retire. I’m open to working part-time or trying different jobs that require fewer hours—perhaps 20 hours a week instead of 40. This approach would allow me to maintain a healthy balance between work and personal life, enabling me to continue earning while enjoying more freedom.

Driven by a desire to escape the rat race as soon as possible—and acknowledging that I don’t have the luxury of waiting another eight years—my focus has shifted from simply reaching financial independence to finding ways to retire from full-time work much sooner. This adjustment in strategy is about aligning our financial actions with our immediate lifestyle goals and long-term aspirations.

Refining Our Approach to an Aggressive Investment Strategy for Financial Independence

When it comes to accelerating our journey toward financial independence, Paul and I are considering an aggressive investment strategy:

1. Investing $20,000 Monthly: By investing this amount each month, we project that we could generate approximately $40,000 annually from dividends at a 4% yield within just over four years.
2. Investing $10,000 Monthly: At half the investment rate, achieving the same annual dividend income would take double the time, roughly over eight years.

Adjusting Financial Strategies to Achieve Semi-Financial Independence First

To make our path to FI more achievable in the near term, we are adjusting our strategy to initially aim for semi-financial independence:

1. Portfolio Milestone: We’re setting a target of $500,000 in shares, rather than the full $1 million, to generate an estimated annual dividend income of about $20,000 at a 4% yield. This milestone can be reached more quickly with aggressive saving, frugal living, and maintaining full-time employment alongside our side hustles.
2. Supplementary Income: We aim to generate a combined annual income of at least $100,000 through part-time jobs or side hustles. This figure is less than half our current total income and will cover our living expenses while allowing us to continue investing aggressively.
3. Ongoing Investment for Full FI: We plan to invest anywhere from $5,000 to $100,000 each month into shares, depending on our monthly income and savings rate.

Currently, our side hustles already contribute over $25,000 annually, a figure we plan to increase as we push toward our $500,000 investment goal. This additional income boosts both our financial stability and our investment capabilities.

Your approach to achieving financial independence may differ based on your age, financial situation, and how long you’re willing to stay in a full-time job or a business that no longer fulfills you. It’s essential to review your current financial status and adapt these strategies to better suit your personal FI journey. While the strategy framework remains similar, the details will vary for everyone.

Dream or Achievable Reality?

To some, our financial planning might resemble a daydream. However, through disciplined savings and strategic investing, achieving financial independence—or even financial freedom—is genuinely within reach. We are committed to turning this dream into reality and will continue to share our progress and insights on this blog.

What are your financial goals or aspirations? How do you plan to achieve them? Your stories and insights are incredibly valuable, and I’d love to hear about your journey towards financial independence. Let’s inspire and support each other as we explore these possibilities together!