6 Affordable Towns in Texas to Retire on a Budget: A Data-Driven Guide for Fixed-Income Planners

Retirement planning across the United States increasingly points toward Texas as a financially viable destination. A SmartAsset study found more than 60,000 retirees relocated to the Lone Star State in 2023 alone. 1 The state levies no income tax at the state level, which means Social Security benefits, pensions, and 401(k) distributions are entirely untaxed by Texas. 2 With the average monthly Social Security benefit hovering around $1,900, finding communities where that figure covers essential living expenses is a practical necessity for millions of households. 3 The six towns below represent a cross-section of Texas geography and community character, each documented by independent cost-of-living research.

1. Eagle Pass: The Nation's Most Affordable Retirement Town

Eagle Pass, situated along the Rio Grande in Maverick County, holds the top position in U.S. News and World Report's ranking of the cheapest places to retire in the United States for 2025 and 2026. 4 The town's population of just under 29,000 supports a median home value of $185,037 and a median monthly rent of only $632, figures that represent dramatic savings relative to most American housing markets. 5 BestPlaces data confirms that the overall cost of living in Eagle Pass runs 20.4 percent below the national average, while the median household income is $58,119. 6 Investopedia and Travel and Leisure both named Eagle Pass among the best Southwest retirement destinations in 2025, citing lower taxes, accessible healthcare, and outdoor amenities including a golf course and a lake suitable for fishing and biking.

Prospective retirees should factor in the border town context. Eagle Pass shares its geography with Piedras Negras, Mexico, which creates a distinctive cultural environment that suits some retirees and may not appeal to others. Healthcare infrastructure in smaller border communities is generally more limited than in major metros, and residents requiring specialty care typically travel to San Antonio or larger regional hospitals. Texas also carries above-average property taxes relative to other low-income-tax states, which can partially offset housing affordability gains for homeowners.

2. Granbury: Historic Lakeside Living with an Award-Winning Town Square

Granbury, located roughly one hour south of Fort Worth, won USA Today's Best Historic Small Town award for the fourth consecutive time in 2025. 7 The town of 10,958 residents has a notably older demographic profile, with 26.1 percent of its population aged 65 or older, meaning community services and social infrastructure tend to cater specifically to retirees. 8 Median monthly mortgage payments run approximately $1,470, and average rent sits around $1,025. Lake Granbury provides water-based recreation throughout the year, while the walkable historic square houses antique shops, restaurants, and the historic Granbury Opera House. Multiple retirement finance outlets have noted that monthly budgets between $1,200 and $1,500 can be sufficient for comfortable living in this community.

Granbury's proximity to Fort Worth is a dual-edged factor. Access to a major metropolitan area gives retirees options for specialty healthcare, airports, and cultural events not available locally. However, that same accessibility has driven some upward pressure on property values compared to more remote Texas towns. Retirees on the tightest budgets may find that the Granbury market, while still affordable relative to national benchmarks, requires more careful financial planning than border communities like Eagle Pass or Rio Grande Valley towns.

3. Brownsville: Gulf-Adjacent Affordability in South Texas

Brownsville, located at the southernmost tip of Texas in Cameron County, has been ranked the top Southern city for retirees operating on a monthly budget of $1,500. 9 BestPlaces data confirms its cost of living index runs 25 percent below the national average, which is among the steepest discounts documented for any Texas city. 10 With a population of approximately 187,000, Brownsville is the largest city on this list and offers correspondingly broader amenities, including the Majestic Theatre, Resaca de la Palma State Park, and year-round access to South Padre Island beaches located 25 to 30 minutes to the east. GOBankingRates calculated that retirees who own a home can manage monthly expenses at approximately $712, rising to $975 for renters. 11

Brownsville carries practical considerations worth examining. Its location on the US-Mexico border means it shares infrastructure pressures common to border communities, including fluctuating service quality in some municipal departments. Healthcare access has improved significantly through regional hospital networks, but the city does not offer the same density of specialty medical providers found in San Antonio or Houston. Retirees requiring frequent specialist visits should account for travel costs in their monthly budgets. Summer heat in South Texas is intense, and utility costs during peak cooling months can be higher than annual averages suggest.

4. Abilene: West Texas Affordability with Urban Infrastructure

Abilene functions as a regional hub for West Texas, giving retirees a lower cost of living alongside a more complete urban infrastructure than smaller towns can provide. One-bedroom apartments in Abilene typically rent for $700 to $800 per month, while utilities average between $100 and $150 monthly. 12 The city's cultural district is anchored by the Grace Museum, and three universities contribute to year-round educational and cultural programming. Research published by BestPlaces and Strategistico consistently places Abilene's cost of living index below both the Texas state average and the national average, making it viable for retirees whose Social Security benefits represent the primary income source.

The West Texas climate presents honest tradeoffs. Summers reach extreme temperatures regularly, and while winters are mild by northern standards, the landscape is markedly more arid than Hill Country or East Texas alternatives. Abilene lacks major interstate airport access, meaning travel to larger cities requires either a drive or connections through regional facilities. Healthcare is available through regional hospital systems, including Hendrick Medical Center, but residents seeking advanced specialty care may need to travel to Dallas or Midland. Property taxes, as is typical throughout Texas, remain a significant ongoing cost for homeowners regardless of purchase price.

5. Rio Hondo and the Rio Grande Valley Cluster

Rio Hondo, a small community in the Lower Rio Grande Valley, represents the extreme end of Texas affordability. Research data from MediaFeed documents median home prices around $80,000 in Rio Hondo, with an overall cost of living approximately 25 percent below the Texas state average, itself already below the national norm. 13 The town also reports crime rates significantly below national averages, which distinguishes it from some other border-adjacent communities. The Rio Grande Valley broadly encompasses Harlingen, McAllen, and Weslaco, each of which carries BestPlaces cost-of-living indices below the national average, giving retirees a cluster of neighboring towns to consider depending on specific needs around healthcare access and community size.

The tradeoffs in this cluster are consistent. Healthcare infrastructure in very small towns like Rio Hondo itself is minimal, and retirees typically rely on the larger Valley cities of McAllen or Harlingen for medical appointments. McAllen in particular is recognized by U.S. News and World Report as a medically well-serviced affordable retirement destination in the Rio Grande Valley. 14 Summer temperatures in the Valley rank among the most extreme in the continental United States, and humidity levels compound heat exposure. Prospective retirees with respiratory conditions or heat-sensitive health profiles should research climate suitability carefully before relocating.

6. Kerrville: Hill Country Appeal with Documented Retirement Infrastructure

Kerrville occupies a distinct position among affordable Texas retirement towns because it combines genuine cost advantages with an established, well-documented retirement community. The town of approximately 24,000 residents sits along the Guadalupe River in the Texas Hill Country, featuring limestone architecture, walkable downtown streets, and a national reputation as a retirement destination. FinanceBuzz named Kerrville among its most underrated retirement towns with undervalued housing markets. 15 AskDoss data places Kerrville's cost-of-living index at 90, ten points below the national average of 100, with a median home price of $275,000, which sits well below the national median for comparable Hill Country geography. 16

Kerrville carries higher entry costs than the border and West Texas communities on this list, but it compensates with a more temperate climate, stronger healthcare infrastructure including a regional hospital system, and a community culture that explicitly caters to older adults. The Hill Country's popularity has created modest upward pressure on real estate, meaning buyers in 2025 and 2026 face a more competitive market than existed five years ago. Retirees should also factor in that Kerrville, while close to San Antonio by Texas standards, is not a commuting-distance suburb, making vehicle ownership essentially mandatory. Property taxes in Kerr County follow the statewide pattern of being above average compared to other low-income-tax states, though the absence of state income tax remains a significant long-term financial offset.

Key Metrics Compared Across All Six Towns

All figures represent general market-level data drawn from published research sources and reflect conditions documented in 2025 and 2026 reporting periods. Individual circumstances, including credit profile, desired neighborhood, and home type, will produce results that vary from these averages. Texas's above-average property tax rates apply in all six communities and represent a consistent ongoing expense that retirees should calculate alongside purchase price or rental rate when estimating total monthly housing costs.

Sources

1. SmartAsset - Texas Retirement Migration Data
2. U.S. News and World Report - Texas Retirement Tax Overview (realestate.usnews.com)
3. SouthHillEnterprise.com - Social Security Average Monthly Benefit Reference
4. U.S. News and World Report - Cheapest Places to Retire 2025-2026 Rankings (via AOL / Travel and Leisure)
5. Travel and Leisure - Eagle Pass Affordable Retirement Data (travelandleisure.com)
6. BestPlaces - Eagle Pass Cost of Living Index (via MediaFeed and Yahoo Lifestyle)
7. MediaFeed - Granbury USA Today Award and Demographic Data (mediafeed.org)
8. MediaFeed / FastFoodClub - Granbury Population and Retirement Demographics
9. TXHeadlines.com - Brownsville Budget Retirement Ranking
10. BestPlaces - Brownsville Cost of Living Index (via Bankrate)
11. GOBankingRates - Brownsville Monthly Retirement Cost Estimates (via Islands.com)
12. FamilyDestinationsGuide.com - Abilene Rental and Utility Cost Data
13. MediaFeed - Rio Hondo Home Price and Cost of Living Data (mediafeed.org)
14. U.S. News and World Report - McAllen Affordable Retirement Overview (realestate.usnews.com)
15. FinanceBuzz - Kerrville Underrated Retirement Market Analysis (via MySanAntonio.com)
16. AskDoss.com - Kerrville Cost of Living Index and Median Home Price (askdoss.com)