Key Takeaways
\nThe cost of living in Eagle Pass, Texas, is almost 18% less than the national average.Amarillo, Texas, is known for its farmers\u2019 markets and can save you some money on groceries.Arizona doesn\u2019t levy Social Security, inheritance, or estate taxes.The cost of living in Albuquerque, New Mexico, is 3% less than the national average, and housing is 9% lower.Oklahoma has some of the lowest property taxes in the country and provides some exemptions for seniors.<\/p>\n
The Southwest might be whispering your name if your vision of a pleasant retirement includes plenty of sunshine. The natural scenery in many areas is spectacular, and this area of the country tends to be senior-friendly. These are Investopedia’s top choices for the best retirement locations<\/a> in the southwestern United States.\n<\/p>\n Eagle Pass, Texas <\/p>\n Let\u2019s look at dollars and cents first. The cost of living in Eagle Pass is 17.8% less than the national average. U.S. News & World Report ranked the town first\u2014yes, No. 1\u2014on its list of the cheapest places to retire in the United States<\/a> in 2025 and 2026. And that was after visiting and gauging 859 cities. The median household income here is $58,119. Half of all households enjoy more income than this, and half make ends meet on less.\n<\/p>\n It\u2019s a medium-sized town in Maverick County, so you won\u2019t be battling crowds if you want to take in its Art and Entertainment District that covers 300 blocks. Eagle Pass is the county seat, tucked up against the Mexican border, and its history is rich. The Texas Mounted Volunteers manned an operation post here on the Rio Grande during the Mexican-American War, located beside a smuggler\u2019s trail that once spanned the river.\n<\/p>\n Stop by the Lucky Edge Casino if you\u2019re looking for more modern entertainment. It\u2019s the only casino in the state, hosted by the Kickapoo Tribe and located just across the town border.\n<\/p>\n Amarillo, Texas <\/p>\n Over 15% of Amarillo\u2019s citizens are age 65 or older, so you\u2019ll have some company when you\u2019re enjoying the numerous activities and events that this small city offers. Art is a big theme here, and you can take in various classes and workshops at Arts in the Sunset provided by the Amarillo Art Institute. Local artists are present in its studios.\n<\/p>\n The Palo Duro Canyon is nearby, located about 30 minutes outside the city, if hiking and taking in scenery are your thing. The canyon is the second largest in the country. You can hike it, bike it, or enjoy it from the back of a horse. The Amarillo Civic Center offers opera, the Lone Star Ballet, and the Amarillo Symphony Orchestra.\n<\/p>\n Amarillo is a farmer\u2019s market mecca if you want to buy or sell your own fresh produce, and the famed Route 66 runs right through the city. The cost of living is 18% less here than the national average, and housing costs are a significant 42% lower. Your utilities will run you 11% less, and you\u2019ll spend 6% less than the national average to buy groceries and stock your pantry.\n<\/p>\n This small city is home to a senior citizen center that offers activities and meals Monday through Friday for those age 60 or older who aren\u2019t in the mood to cook.\n<\/p>\n Arizona, New Mexico, and Oklahoma <\/p>\n Arizona features some infamous and eye-popping views if your idea of retirement includes the great outdoors. Think the Grand Canyon and Hoover Dam. Arizona has been ranked as the second most popular retirement destination in the country, behind Florida, and Florida has all that humidity. Now take a deep breath: The average home value<\/a> in this state is $417,540 as of Jan. 31, 2026, although that\u2019s down 2.6% from 2025.\n<\/p>\n New Mexico is known for its interesting annual social events, such as the Roswell UFO Festival and the Albuquerque International Balloon Fiesta. The cost of living<\/a> in Albuquerque is 3% less than the national average overall, and housing is 9% lower.\n<\/p>\n Oklahoma City offers the Myriad Botanical Gardens if you want to take a walk along flower-lined paths. Stillwater is home to Boomer Lake Park with a 3.2-mile paved trail, ideal for both walking and biking. The cost of living in Oklahoma City is 19% below the national average, and housing costs are 41% below the U.S. average, matching those in Amarillo.\n<\/p>\n The Financial Benefits of Retiring in the Southwest <\/p>\n