Aerial view of Sebring, Florida

Commitment to Our Readers

GOBankingRates’ editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services – our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.

20 Years
Helping You Live Richer

Trusted by
Millions of Readers

Retirement doesn’t mean you have to give up nice weather or the enjoyment of life. Yes, it’s tough to live on a fixed income, but location is everything.

 

 

According to the U.S. Bureau of Labor Statistics, the average American household’s expenses are $78,535 a year, but depending on where you settle, having a monthly income of $2,500 can cover a comfortable pace of life. Here are five small towns where you can retire on a modest budget and soak up the beautiful weather. 

1. Las Vegas, New Mexico: Affordable High-Desert Retirement With Sunny Weather
Population: 13,000
Cost of living: 21.5% lower than the U.S. average
Average home value: $241,426
Median household income: $50,585

Las Vegas, New Mexico, isn’t as flashy as the strip in Nevada, but it has something else going for it — affordability. Retirees who enjoy outdoor activities and spending time in nature can live there for about $2,333 a month, according to BestPlaces. The high-desert climate is dry and sunny, with especially beautiful weather in the spring and fall.

 

2. Sebring, Florida: A Budget-Friendly Retirement Town With Year-Round Sunshine
Population: 11,382
Cost of living: 17% lower than the U.S. average 
Average home value: $238,872
Median household income: $44,184

Community, year-round sunny skies and a wide range of activities are perks retirees can look forward to in Sebring. Plus, it’s wallet-friendly. You can live there for $2,300 per month, according to BestPlaces.

3. Mason City, Iowa: One of the Most Affordable Small Towns for Retirees
Population: 27,050
Cost of living: 26.7% lower than the U.S. average
Average home value: $154,095
Median household income: $64,804

Retirees on a budget can enjoy a low cost of living of around $2,133 a month, according to BestPlaces, and enjoy the town’s historic architecture, walking trails, parks and golfing. The area features long, warm summers and shorter cold winters. 

4. Brownsville, Texas: Warm Weather Retirement on a Budget
Population: 189,177
Cost of living: 25.1% lower than the U.S. average
Average home value: $195,993
Median household income: $52,130

With its warm, tropical climate, proximity to South Padre Island beaches and welcoming community, Brownsville is a destination retirees are drawn to. It’s also cost-effective, with monthly expenses averaging $2,400 per month, according to BestPlaces. 

5. Grenada, Mississippi: A Low-Cost Retirement Town Near the Lake
Population: 12,375
Cost of living: 29.2% lower than the U.S. average 
Average home value: $133,953
Median household income: $46,303

Grenada is a peaceful small town where retirees can enjoy an affordable cost of living of about $2,000 per month, per BestPlaces. With Grenada Lake nearby, residents have easy access to camping, fishing, hiking and scenic waterfront views.

Retiring in the U.S. has been a financial strain for many, but in the right spot, it’s possible to live on $2,500 a month and still enjoy a fun lifestyle.

Editor’s note: Population and media household income figures were sourced from Data USA. Cost-of-living figures were sourced from BestPlaces, and average home values were sourced from Zillow.