Retiring in Texas: Taxes, Healthcare & Cost of Living (2026)
Texas has no state income tax — Social Security, pensions, and all retirement income go completely untaxed. The state’s size means retirement options range from Gulf Coast beaches to Hill Country towns to desert landscapes near Big Bend. MD Anderson Cancer Center in Houston is the top-ranked cancer hospital in the country. Property taxes are above average, which partially offsets the lack of income tax.
The combination of tax policy, healthcare infrastructure, climate, and cost of living determines how well your retirement savings will last in Texas. This guide covers the top cities for retirees, a full tax breakdown, healthcare access, and realistic budget estimates for 2026.
Whether you are relocating from a high-cost state or staying close to family, understanding the full picture matters. Use our state tax comparison tool to see how Texas stacks up against other states you are considering, and check our what can I afford calculator to estimate what you can buy on a retirement budget.
Top Retirement Cities in Texas
The following cities stand out for retirees in Texas based on cost of living, healthcare access, walkability, climate, and community infrastructure. The cost of living (CoL) index uses 100 as the national average — below 100 means cheaper than most of the country.
| City | CoL Index | Median Home Price | Climate |
|---|---|---|---|
| San Antonio | 88 | $275,000 | Subtropical, hot summers |
| Georgetown | 92 | $345,000 | Subtropical, hot summers |
| Fredericksburg | 96 | $395,000 | Hill Country, hot summers |
| New Braunfels | 90 | $315,000 | Subtropical, hot summers |
| Kerrville | 90 | $275,000 | Hill Country, hot summers |
| Corpus Christi | 86 | $245,000 | Subtropical, coastal |
San Antonio
San Antonio offers historic charm (the Alamo, River Walk, missions), a diverse food scene, and a cost of living below the national average. University Health System, Methodist Healthcare, and Baptist Health System provide comprehensive care. The Pearl District has become one of the best food and shopping destinations in Texas. Joint Base San Antonio makes the city military-retiree friendly. A couple can retire comfortably here on $42,000.
Walkability: San Antonio has a walk score of 42, which means some errands can be completed on foot in certain neighborhoods. A car is helpful for most activities, but the walkable pockets around the downtown area and main commercial corridors give retirees options for staying active without driving everywhere.
Climate: San Antonio has a subtropical, hot summers climate.
Winters are mild, which reduces heating costs and allows outdoor activity year-round. Retirees who want to avoid harsh winters will find San Antonio comfortable from October through April.
With a cost of living index of 88 and a median home price of $275,000, San Antonio is more affordable than the national average. Check our budget calculator to see how your retirement income translates in San Antonio, or review closing costs in Texas if you are planning a purchase.
Georgetown
Georgetown, 30 miles north of Austin, has been named the #1 retirement destination in Texas by multiple publications. Baylor Scott & White Medical Center provides care, and Austin’s major hospitals are 30 minutes south. The Victorian downtown square, Blue Hole Park, and Sun City (the largest active-adult community in Texas, 9,600+ homes) define the community. The cost of living is moderate for the Austin metro.
Walkability: Georgetown has a walk score of 42, which means some errands can be completed on foot in certain neighborhoods. A car is helpful for most activities, but the walkable pockets around the downtown area and main commercial corridors give retirees options for staying active without driving everywhere.
Climate: Georgetown has a subtropical, hot summers climate.
Winters are mild, which reduces heating costs and allows outdoor activity year-round. Retirees who want to avoid harsh winters will find Georgetown comfortable from October through April.
With a cost of living index of 92 and a median home price of $345,000, Georgetown is more affordable than the national average. Check our what can I afford calculator to see how your retirement income translates in Georgetown, or review closing costs in Texas if you are planning a purchase.
Fredericksburg
Fredericksburg sits in the Texas Hill Country and blends German heritage with wine country — the area has 50+ wineries and tasting rooms along US 290. Hill Country Memorial Hospital provides care. The National Museum of the Pacific War (the only museum in the US dedicated to the Pacific Theater of WWII) is here. Enchanted Rock State Natural Area is 18 miles north. The community is tourist-friendly but retains a genuine small-town core.
Walkability: Fredericksburg has a walk score of 45, which means some errands can be completed on foot in certain neighborhoods. A car is helpful for most activities, but the walkable pockets around the downtown area and main commercial corridors give retirees options for staying active without driving everywhere.
Climate: Fredericksburg has a hill country, hot summers climate.
Summers can be intense, with temperatures regularly exceeding 100 degrees from June through September. Many retirees adjust by scheduling outdoor activities in the early morning or evening and spending the hottest months in air-conditioned comfort.
With a cost of living index of 96 and a median home price of $395,000, Fredericksburg is more affordable than the national average. Check our see what you can afford to see how your retirement income translates in Fredericksburg, or review closing costs in Texas if you are planning a purchase.
New Braunfels
New Braunfels sits between San Antonio and Austin on the Comal and Guadalupe rivers. Christus Santa Rosa Hospital and Resolute Health Hospital provide care. Schlitterbahn water park, Gruene Historic District (Gruene Hall is the oldest dance hall in Texas), and river tubing define the culture. The city has grown rapidly — population doubled since 2010 — and multiple 55+ communities have opened.
Walkability: New Braunfels has a walk score of 36, which means some errands can be completed on foot in certain neighborhoods. A car is helpful for most activities, but the walkable pockets around the downtown area and main commercial corridors give retirees options for staying active without driving everywhere.
Climate: New Braunfels has a subtropical, hot summers climate.
Winters are mild, which reduces heating costs and allows outdoor activity year-round. Retirees who want to avoid harsh winters will find New Braunfels comfortable from October through April.
With a cost of living index of 90 and a median home price of $315,000, New Braunfels is more affordable than the national average. Check our budget calculator to see how your retirement income translates in New Braunfels, or review closing costs in Texas if you are planning a purchase.
Kerrville
Kerrville sits on the Guadalupe River in the Hill Country and has a long history as a retirement and health destination. Peterson Regional Medical Center and the Kerrville VA Medical Center serve the community. The Schreiner University campus, Kerrville Folk Festival (the longest-running music festival in North America), and the Louise Hays Park riverwalk create a pleasant lifestyle. The cost of living runs 10% below the national average.
Walkability: Kerrville has a walk score of 38, which means some errands can be completed on foot in certain neighborhoods. A car is helpful for most activities, but the walkable pockets around the downtown area and main commercial corridors give retirees options for staying active without driving everywhere.
Climate: Kerrville has a hill country, hot summers climate.
Summers can be intense, with temperatures regularly exceeding 100 degrees from June through September. Many retirees adjust by scheduling outdoor activities in the early morning or evening and spending the hottest months in air-conditioned comfort.
With a cost of living index of 90 and a median home price of $275,000, Kerrville is more affordable than the national average. Check our affordability calculator to see how your retirement income translates in Kerrville, or review closing costs in Texas if you are planning a purchase.
Corpus Christi
Corpus Christi offers Gulf Coast beach retirement at Texas prices. Christus Spohn Health System and Driscoll Children’s Hospital provide care. North Padre Island, the USS Lexington Museum, and the Texas State Aquarium provide recreation. The Bayfront Science Park and Marina have been redeveloped. The cost of living runs 12% below the national average, and the year-round fishing is exceptional.
Walkability: Corpus Christi has a walk score of 34, which means a car is needed for most activities. Retirees should plan for reliable transportation. Several neighborhoods have sidewalks and short drives to shopping centers and medical facilities, but daily errands generally require a vehicle.
Climate: Corpus Christi has a subtropical, coastal climate.
Winters are mild, which reduces heating costs and allows outdoor activity year-round. Retirees who want to avoid harsh winters will find Corpus Christi comfortable from October through April.
With a cost of living index of 86 and a median home price of $245,000, Corpus Christi is more affordable than the national average. Check our budget calculator to see how your retirement income translates in Corpus Christi, or review closing costs in Texas if you are planning a purchase.
Tax Benefits for Retirees in Texas
Texas has no state income tax, so Social Security, pensions, and all retirement income go completely untaxed at the state level. Below is a summary of how Texas treats the major income sources retirees rely on.
| Tax Category | Details |
|---|---|
| State Income Tax | None |
| Social Security Taxed? | No (no state income tax) |
| Pension Income Taxed? | No (no state income tax) |
| Property Tax Senior Exemption | Yes (see details below) |
Texas has no state income tax. Social Security, pensions, 401(k) distributions, IRA withdrawals, and all other income are completely untaxed at the state level. There is no estate or inheritance tax. Property taxes are above average — the median effective rate is about 1.60%. The homestead exemption provides $100,000 off assessed value for school district taxes, plus additional amounts from counties and cities. Seniors 65+ get an additional $10,000 school district exemption AND a property tax ceiling (freeze) on school taxes — once you turn 65, your school taxes cannot increase above the frozen amount. The state sales tax is 6.25%, with local additions up to 8.25%.
Tax rules change regularly, and your specific situation — filing status, total income, and income sources — determines the actual impact. Consult a tax professional who knows Texas tax law before making a relocation decision based on taxes alone. For a side-by-side comparison with other states, visit our state tax comparison.
If you are buying property in Texas, factor in the closing costs and ongoing property tax obligations. The best mortgage lenders in Texas can help you find competitive rates if you need financing for your retirement home.
Healthcare Access in Texas
MD Anderson Cancer Center in Houston is the #1-ranked cancer hospital in the country. Texas Medical Center in Houston is the largest medical complex in the world, housing 60+ institutions. UT Southwestern in Dallas, Baylor Scott & White (the largest nonprofit health system in Texas), and Methodist in Houston and San Antonio provide strong coverage. University Health in San Antonio, Seton/Ascension in Austin, and the VA system in San Antonio and Temple serve central Texas. Medicare Advantage penetration is about 42%, with plans from UnitedHealthcare, Humana, Aetna, and WellMed (an Optum company).
When evaluating healthcare for retirement, consider proximity to a hospital with emergency services, the availability of specialists you may need (cardiology, orthopedics, oncology), and the Medicare Advantage plan options in the county where you plan to live. Medicare Advantage plans can reduce out-of-pocket costs significantly, but network restrictions mean you need to verify that your preferred doctors and hospitals are in-network.
If you have a chronic condition or anticipate needing specialized care, prioritize cities near major medical centers. The cities listed above were selected partly for their healthcare access. Telehealth services have expanded across Texas, which helps retirees in smaller communities access specialists without traveling to metro areas for every appointment.
Prescription drug costs also vary by plan and pharmacy. Review Medicare Part D options during open enrollment each fall, and consider whether a Medigap (Medicare Supplement) policy fits your budget and healthcare usage patterns.
Cost of Living for Retirees in Texas
Retirement costs in Texas depend on where you live, whether you own your home outright, your healthcare needs, and your lifestyle. Below are estimated annual budgets for a single retiree and a retired couple living in a mid-cost area of the state with mortgage-free housing. Renters should add $8,000 to $18,000 per year depending on location and apartment size.
| Expense Category | Single Retiree | Retired Couple |
|---|---|---|
| Housing (taxes, insurance, maintenance) | $8,400/yr | $11,960/yr |
| Food & Groceries | $5,400/yr | $8,280/yr |
| Healthcare & Insurance | $6,600/yr | $10,120/yr |
| Transportation | $4,200/yr | $6,440/yr |
| Utilities, Entertainment, Other | $5,400/yr | $9,200/yr |
| Estimated Total | $30,000/yr | $46,000/yr |
These estimates reflect a modest but comfortable lifestyle. Adding travel, dining out, hobbies, or long-term care insurance increases the total. Healthcare costs are the most unpredictable category — a single major medical event can add $5,000 to $15,000 in out-of-pocket expenses even with Medicare coverage.
Housing costs vary dramatically within Texas. The cities with higher CoL indexes in the table above will cost more for property taxes, insurance, and maintenance. If you are considering buying, use our calculate your mortgage payment to estimate monthly payments, and check homeowner insurance costs in Texas to build an accurate budget.
For couples deciding between Texas and another state, the difference in annual costs can be $5,000 to $20,000 per year depending on tax savings, housing costs, and healthcare expenses. Run the numbers for both states before committing.
Frequently Asked Questions
Does Texas tax Social Security benefits?
No. Texas has no state income tax, so Social Security benefits are not taxed at the state level. You will still owe federal taxes on Social Security if your combined income exceeds $25,000 (single) or $32,000 (married filing jointly), but Texas does not add any state tax on top of that.
What is the best city to retire in Texas?
San Antonio consistently ranks among the top retirement destinations in Texas, offering a cost of living index of 88, a median home price of $275,000, and solid community infrastructure for retirees. However, the best city for you depends on what matters most: proximity to family, healthcare access, outdoor recreation, walkability, or affordability. Retirees who prioritize affordability may prefer one of the lower-CoL options listed above, while those focused on healthcare access should look at cities near major hospital systems.
How is healthcare access for retirees in Texas?
Healthcare access varies by region within Texas. Metro areas have multiple hospital systems, specialist practices, and Medicare Advantage plan options. Smaller cities and rural areas may have a single community hospital and limited specialist availability, which means traveling to a larger city for certain procedures. Check Medicare Advantage plan availability in the specific county where you plan to live before finalizing your decision.
How much does it cost to retire in Texas?
A single retiree can expect to spend roughly $30,000 per year in Texas, while a couple should budget approximately $46,000 per year. These figures assume mortgage-free housing in a mid-cost area of the state. Costs range widely — resort towns, coastal areas, and college towns tend to run 20% to 50% higher, while rural communities and smaller cities may run 10% to 20% lower. Housing, healthcare, and taxes are the three biggest variables.
Are there property tax breaks for seniors in Texas?
Texas does offer property tax relief programs for seniors, though the specific exemptions, income thresholds, and application processes vary by county and municipality. Common programs include homestead exemptions, assessment freezes for seniors over 65, and circuit-breaker credits that cap property taxes relative to income. Contact your county assessor’s office for current programs and application deadlines. Our Texas real estate guide covers property taxes and homeownership costs in more detail.
Retirement in Nearby States
If you are comparing Texas with neighboring states, these guides cover the same topics — top cities, tax benefits, healthcare access, and cost of living:
- Retiring in Oklahoma: Taxes, Healthcare & Cost of Living (2026)
- Retiring in Louisiana: Taxes, Healthcare & Cost of Living (2026)
- Retiring in New Mexico: Taxes, Healthcare & Cost of Living (2026)
- Retiring in Arkansas: Taxes, Healthcare & Cost of Living (2026)
For more on the Texas housing market, explore our Texas real estate guide, review homeowner insurance options in Texas, or use our see what you can afford to see what you can buy on a retirement budget. If you are planning a move, the mortgage payment estimator can help you estimate monthly payments on a new home.