Should you retire in New Mexico?

If you love chile verde and Georgia O’Keeffe and are thinking of relocating for retirement, consider the wonderful state of New Mexico. It offers plenty of natural beauty and opportunities for outdoor recreation such as hiking, fishing and skiing. It also offers plenty of culture, with museums, festivals, art galleries, and even the famous annual Albuquerque Hot Air Balloon Fest.

The climate is another plus. Although it can get very cold or hot depending on where you are, parts of New Mexico have a moderate climate that will suit many people better than the heat of Florida or Arizona.

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When it comes to taxes, New Mexico is not among the 41 states that do not tax Social Security benefits. But thanks to a recent law, it only taxes those with relatively high incomes, such as singles earning more than $100,000. Meanwhile, withdrawals from 401(k) and IRA accounts and pension income are also taxable, though only partially. There is no property tax in New Mexico either — although federal property taxes still apply.

The quality, availability, and cost of health care should be a major concern for retirees and should be factored into your overall retirement plan. New Mexico scores pretty well on this front: MedicareGuide.com rated it the 18th best state in the country for health care for seniors.

The cost of living in New Mexico is only about 94 percent of the national average, according to the World Population Review, which is a plus — especially if you’re moving there from a high-cost region. The average home price in New Mexico was recently just $306,434 — about 84 percent of the national average. Auto insurance is also on the low side, recently averaging $2,438 annually, about $579 below average.

If you like the idea of ​​New Mexico, know that it has some vulnerability to natural disasters like fires, floods, and even earthquakes, and water isn’t as abundant as many other places. It’s smart to spend at least a few months living in any place you’re considering moving to — to make sure it’s a good fit.