The Pros and Cons of Retiring in Texas

When you think of Texas, what comes to mind? Wide open spaces, friendly communities, big skies — and maybe brisket. But Texas is more than just cowboy boots and barbecue. For retirees looking for sunshine, affordability and a slower pace of life, it’s a state worth serious consideration.

Still, retiring in Texas isn’t the right fit for everyone. The weather, property taxes and health care access can present challenges, depending on your needs and lifestyle.

In this guide, we’ll walk through the pros and cons of retiring in Texas to help you decide whether the Lone Star State should be part of your retirement strategy.

THE PROS OF RETIRING IN TEXAS

AFFORDABLE COST OF LIVING

One of the biggest reasons retirees flock to Texas? Affordability.

• Texas has no state income tax, which means Social Security benefits, pensions, 401ks and IRA withdrawals aren’t taxed at the state level
• Overall cost of living is below the national average, especially in smaller cities and rural areas
• Housing prices remain more accessible than in many coastal states – in 2025, the median home price statewide was about $331,000

From property prices to groceries, Texas can make it easier to stretch your retirement dollars further.

WARM WEATHER AND SUNSHINE

Texas offers a sunny retirement, quite literally.

• Texas enjoys warm, sunny weather many months of the year
• Winters are typically mild, especially in central and southern Texas, allowing for year-round outdoor activity
• Cities like San Antonio, Austin and Houston rarely see snow – and you can usually leave the heavy coat behind

If you’re looking to escape harsh winters, Texas may feel like a permanent vacation.

NO STATE INCOME TAX

As mentioned, Texas is one of the few states that does not collect personal income tax. That means:

• No tax on Social Security income
• No tax on withdrawals from IRAs, 401ks or pension plans
• Retirees with significant retirement savings can benefit from meaningful tax savings over time

However, Texas does rely on other forms of taxation, which we’ll discuss a bit later.

DIVERSE RETIREMENT DESTINATIONS

Texas offers a wide variety of retirement locations to suit different lifestyles and budgets:

• Hill Country towns like Fredericksburg and Kerrville offer small-town charm with scenic landscapes
• Urban centers like Austin, Dallas and Houston provide cultural access and world-class dining
• Coastal areas such as Galveston or Corpus Christi offer beachfront living at a fraction of the price compared to other coastal states
• College towns like College Station or Waco appeal to retirees looking for educational and cultural enrichment

Whether you’re after big city energy, rural quiet or something in between, Texas delivers options.

STRONG SENSE OF COMMUNITY

Many retirees report feeling welcome in Texas, thanks to its reputation for Southern hospitality.

• Active community involvement is common in many towns
• A wide variety of religious, volunteer and social groups help retirees stay connected
• Cultural diversity and strong regional identities make exploring the state a rich experience

If you value community connection, you may find close bonds in Texas.

THE CONS OF RETIRING IN TEXAS

EXTREME SUMMER HEAT

While winters are mild, Texas summers can be brutally hot.

• Temperatures in many parts of the state can exceed 100°F during summer months
• High heat can make outdoor activities less appealing and increase energy bills
• For retirees with health conditions sensitive to heat, the climate may require extra precautions
• Air conditioning is non-negotiable and your electricity usage may rise accordingly

HIGH PROPERTY TAXES

Texas may not have a state income tax, but that doesn’t mean retirees get a tax-free ride. Instead, the state relies heavily on local property taxes, which are among the highest in the country.

• Texas has no state property tax, so instead, counties, cities, school districts and other local authorities set their own tax rates and collect the revenue
• The average effective property tax rate is about 1.68%, which can lead to sizable annual bills depending on property value
• Taxes fund essential services like public schools, roads, police and fire departments, but rates can vary widely depending on where you live
• Seniors may qualify for property tax exemptions, freezes or deferrals, but these require planning and proactive enrollment

For retirees on a fixed income, these taxes can affect your long-term budget – especially if your home’s value increases over time. Where you choose to live in Texas can make a significant difference in what you pay.

HEALTH CARE ACCESS VARIES BY REGION

Texas is home to top-tier hospitals and specialists – but access isn’t equal across the state.

• Metro areas like Houston (home to the renowned Texas Medical Center), Dallas and Austin offer excellent care options
• Rural areas may have limited provider availability and longer travel times for specialized treatment
• Texas has one of the highest uninsured rates in the country, which may impact overall system strain

If proximity to high-quality care is a priority, choose your location thoughtfully.

NATURAL DISASTERS AND WEATHER RISKS

Like many states, Texas has its share of environmental risks:

• Hurricanes can impact coastal areas during late summer and fall
• Tornadoes are common in parts of North and Central Texas
• Drought and water shortages can be ongoing concerns, especially in the west

Home insurance costs may be higher in some regions due to storm or flood risk – something to consider as you shop for a retirement property.

IS TEXAS THE RIGHT RETIREMENT DESTINATION FOR YOU?

Retiring in Texas offers some standout benefits — from potential tax savings and warm weather to friendly communities and open spaces. But no state is perfect and it’s important to weigh the full picture.

Texas might be a great fit if you:

• Want to lower your tax burden and stretch your retirement savings
• Prefer sunshine and minimal winter weather
• Enjoy a slower pace of life and strong community ties
• Have the flexibility to choose a location that fits your health care and lifestyle needs

However, if extreme heat, high property taxes or limited rural health care access give you pause, you may want to compare Texas with other retirement-friendly states like Florida, North Carolina or Tennessee.

Wherever you’re considering, thoughtful planning is key. At Edelman Financial Engines, we work with clients across the country to build personalized retirement strategies that align with their goals, lifestyle and location preferences.

From state-by-state tax comparisons to housing costs and health care access, we’ll help you navigate your options in the Lone Star State with clarity and confidence.