The short version
- Social Security taxed?
- Partly
- Income tax
- Brackets 1.5%–5.9%
- Property tax on a $300,000 home
- ≈ $1,890 / yr ($158 / mo)
- Everyday cost index (U.S. = 100)
- 94
- January / July high
- 47°F / 92°F
- Sales tax (state + local avg)
- 7.68%
Retiring in New Mexico
Low property taxes, low costs, and 278 sunny days. Watch out: Social Security is taxed above $100,000/$150,000 of income, and rural healthcare is thin.
How New Mexico taxes your retirement income
Social Security: this state taxes a portion of benefits, usually above certain income levels.
Pensions: $8,000 senior exemption at 65+ (income limits apply).
401(k) and IRA withdrawals: The senior exemption covers some 401(k)/IRA income.
The setup: Brackets 1.5%–5.9%.
Property tax & senior breaks
The average effective property tax rate is about 0.63% — roughly $1,890 a year ($158 a month) on a $300,000 home. Your county sets the real number.
Help for seniors: Homeowners 65+ with modest income can freeze their home's value for tax purposes.
Try your own home value in the Property Tax Estimator.
Everyday costs & sales tax
Overall cost of living runs about 6% below the U.S. average. The combined state and average local sales tax is 7.68%.
Weather
January days top out around 47°F and July days around 92°F, with roughly 278 sunny days a year. Watch out for: Wildfire risk and ongoing drought.
Healthcare
UNM anchors care in Albuquerque; rural access is limited.