Mar 10, 2022

Is New Mexico a good place to retire?

Nat Miller

While many people know that Arizona is a booming destination for retirement relocation, its eastern neighbor New Mexico provides another amazing place to retire, and for many of the same reasons: it offers retirees warm weather, a friendly tax climate and a low cost of living, and access to plenty of outdoor activities and cultural events. If you’re excited about the prospect of moving to either a desert locale or the American southwest more generally, New Mexico is absolutely worth your consideration. 

Low Costs

If you’re a dedicated follower of our blog you’ll know that there’s one thing we love in a retirement destination, and that’s the state being low tax and low cost so that you get the most bang for your retirement buck. New Mexico absolutely provides for a low-cost retirement thanks to its low taxes and low cost of living.  

New Mexico residents enjoy one of the best tax climates in the entire country. First, and maybe most importantly for those looking to move to New Mexico as part of their retirement, New Mexico has incredibly friendly property taxes. In fact, New Mexico has one of the lowest property tax rates in the entire country, with an average effective property tax rate of only .078%. This means that each year the median annual property tax paid by a New Mexico resident is only roughly $1,403, almost $1,200 less than the national median. One of the things that keeps New Mexico property taxes so low is that the state has capped the amount that the taxable value of a property can increase in a year at 3%. This means that even if property taxes skyrocket after you’ve moved in, your property tax bill won’t!  

Unfortunately, New Mexico is not quite as friendly towards retirement taxes, as unlike its neighbor Arizona, it does tax Social Security benefits (although they are partially deductible and there is also a potential deduction on retirement income like from a pension or trust). Although New Mexico does not have a sales tax, it does have a gross receipts tax which is charged to businesses and therefore often passed along to customers. According to information published by SmartAsset, a financial technology company, this gross receipts tax ends up being slightly higher for tax payers than the average sales tax found around the country. That being said, at the end of the day New Mexico’s tax regime is still incredibly friendly and will allow you to make the most of your retirement income.  

In addition to the friendly taxes, New Mexico also has a low cost of living that is 11.6% cheaper than the national average. So wherever you’re coming from, odds are your life will be cheaper in New Mexico than in your old state.

The Great Outdoors

Another thing that makes New Mexico a great place to retire is the warm weather, with temperatures only ever dropping to around the 50s in the winter and an average of 280 days of sun per year. This means that with a relocation to New Mexico you can comfortably say that you are leaving the winter months behind. And while temperatures often rise to the 90s in the summer, locals will tell you that the dry heat (meaning relative lack of humidity) makes for incredibly pleasant summer months.  

It’s a good thing that New Mexico has such amazing weather, because it has some of the most exceptional and breathtaking outdoors areas in the country. Let’s just say, New Mexico has definitely earned its state nickname as “the land of enchantment.” From the otherworldly rock formations, to the white sand deserts to the clear night skies with thousands of stars, you’ll never get bored exploring all that New Mexico has to offer. Must-see destinations include the Tent Rocks, Valles Caldera, Carlsbad Caverns and Bandelier.

New Mexico offers many fun ways to experience nature, such as on one of the state’s many bike or hiking trails or golf courses, or - believe it or not - ski trails. While many people think of Western states like Colorado or Utah for their skiing, New Mexico is one of the country’s best-kept skiing secrets. These ski resorts are located in the Sandia Mountains northeast of Albuquerque, New Mexico, and allow people to still take advantage of popular winter activities while getting to live in the warmth the rest of the year.  

Activities

Along with great outdoor activities, New Mexico offers a thriving arts and culture scene.  There are many museums for you to visit including the New Mexico Museum of Art, New Mexico Museum of Natural History and Science, the Indian Pueblo Cultural Center, National Hispanic Cultural Center or the National Museum of Nuclear Science and History. This rich tradition of culture should come as no surprise, given that Santa Fe, New Mexico is considered by some to be the oldest continually inhabited city in the United States. And the state itself is home to three UNESCO world heritage sites: Chaco, Carlsbad, and Taos Pueblo.  

Santa Fe is one of the many New Mexico cities that has a long and rich history.

In addition to this thriving cultural scene, New Mexico is also known for its culinary prowess, particularly its many award-winning vineyards. Whether your passion is cooking or drinking, New Mexico has world-class culinary experiences all across the state.  

Best Cities to Retire to in New Mexico

If you decide to move to New Mexico, you’ll be able to choose from a wide range of amazing cities to relocate to. Below we list a couple of our favorite cities in New Mexico (for a more in-depth analysis check out our blog post on the best cities to retire to in New Mexico), but there are truly so many wonderful cities in New Mexico to explore.   

  • Albuquerque: This city offers retirees sunny weather, a low cost of living, and plenty of cultural events and activities. 
  • Las Cruces: Retirees will appreciate the city's warm weather and dry climate, as well as its low cost of living and abundance of golf courses. 
  • Santa Fe: Santa Fe is known for its art scene, and retirees will find plenty to keep them busy here including museums, galleries, and theaters. 
  • Taos: Taos is a beautiful town with great weather and a vibrant culture. It's also an excellent place to enjoy outdoor activities like skiing, hiking, biking, fishing and golfing. 

Retiring to New Mexico is a great option for retirees who want warm weather, low taxes and a low cost of living. New Mexico offers an attractive lifestyle with plenty of arts and culture as well as outdoor activities thanks to its diverse geography. 

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