4 hours ago 2

Want To Retire in a Cheap City? 6 Hidden Costs You May Not Have Thought About

Sat, Sep 6, 2025, 8:16 AM 3 min read

At first glance, spending your golden years in a city with low housing costs, no state income tax, and warm weather looks like a retiree’s dream. However, before you sell your home and pack up your belongings, it’s worth digging a little deeper.

Find Out: 4 Affordable Car Brands You Won't Regret Buying in 2025

Many “cheap” retirement destinations come with hidden fees — ranging from pricey home insurance to high amenity fees not advertised in glossy brochures.

Here are six hidden costs in cheap cities that you may have overlooked.

The city of McAllen, Texas, ranks among the cheapest cities in the U.S. However, energy costs are 19% higher in McAllen than the national average, according to Kiplinger. With high temperatures and the need to run air conditioning for much of the year, your energy bill can take a big chunk out of your budget if you’re on a fixed income.

Discover Next: The New Retirement Problem Boomers Are Facing

Many cheap cities boasting low home prices and taxes are burdened by exorbitant home insurance and flood insurance rates due to climate change and natural disasters such as hurricanes, tropical storms, tornadoes, wind damage and flooding caused by heavy rainfall.

Oklahoma tops the list with average annual premiums of $6,133 per year — 119% higher than the national average of $2,801, according to OKC News 9. So if you’re considering relocating to Oklahoma City, you may want to think twice.

Following Oklahoma, these 10 cities in Texas, Florida and Louisiana hit residents with some of the highest annual home insurance premiums.

Houston: $4,661
Fort Worth, TX: $4,313
Arlington, TX: $4,329
New Orleans: $4,300
Irving, TX: $4,061
Lubbock, TX: $4,005
Dallas: $3,888
Port St. Lucie, FL: $3,667
Frisco, TX: $3,614
Cape Coral, FL: $3,161

Another money pit to watch for is the grocery tax. Even if a state doesn’t tax groceries, you may still have to shell out local or county taxes on the food you buy. For example, while Oklahoma recently removed its 4.5% tax on groceries, Oklahoma City residents have to pay a combined sales tax of 8.63% that applies to groceries.

Many Florida homeowners are required to pay annual Community Development District (CDD) non-ad valorem assessment fees to their city district, which are added to their property tax bills.

These charges cover bond payments and operation and maintenance (O&M) costs for community infrastructure. The amount varies based on the type and size of your property in the city where you live. Homeowners are responsible for these fees until the bonded debt is repaid.

Read Entire Article