Retirement Planning in San Antonio

Retiring in a military city

San Antonio has many people who arrived on orders and never left. Retirees here include former airmen who trained at Lackland, soldiers who passed through Fort Sam Houston and Army medical training, pilots from Randolph, and the civilians who worked beside them. According to the U.S. Census Bureau, 2020 to 2024 American Community Survey, about 13.4 percent of residents are 65 or older, while the median age is only about 34.9. The city is young, but a large group of retirees is part of its fabric, and many more are approaching it.

The retirement picture differs a great deal from one household to the next, so this page walks through the most common cases rather than one average plan.

Two retirements for one career

A service member who retires after twenty years may be 40 to 45 years old. Retired pay begins right away, which sounds like a finished plan, but the money has to last for forty or fifty years. Many military retirees take a second job, often as a federal contractor, a federal civilian or in healthcare, and then retire again at 62 to 67.

The first retirement and the second one have different tasks. In the first, you decide how much retired pay to count on, how to cover the gap in health insurance, and whether to sign up for the Survivor Benefit Plan. In the second, you choose a Social Security claiming age, handle a new workplace plan and coordinate it with the Thrift Savings Plan. Both retirements benefit from a single written plan that follows the household.

What counts as retirement income

The interaction between VA disability compensation and retired pay is worth a close look. Some retirees receive both through special rules, while others see retired pay reduced. A planner or a military benefits counselor can confirm which applies to you.

Healthcare before and after 65

Health coverage is often the largest unknown. Military retirees and their families can use TRICARE, and at 65 the system generally works alongside Medicare. San Antonio has an unusual advantage here, with Brooke Army Medical Center, Wilford Hall at Lackland and the Audie L. Murphy VA hospital, plus large civilian systems in the Medical Center. Access varies with eligibility, so confirm which facilities you can use and what a referral requires.

Civilians face a different timeline. Retiring before 65 means buying a marketplace plan or continuing employer coverage, and the cost can run well beyond what people expect. At 65, Medicare begins, and the choice between traditional Medicare with a supplement and a Medicare Advantage plan affects your doctors, your costs and your freedom to move. Check which plans your hospital and specialists accept before you pick one, and review the choice each fall.

Social Security decisions

Claiming at 62 gives a smaller benefit for life, while waiting until 70 gives a larger one. The better age depends on health, other income, a spouse’s benefit and how long people in your family tend to live. For married couples, the higher earner’s choice also determines the survivor benefit, so delaying that benefit can act as longevity insurance for the surviving spouse.

Many teachers and some public workers in Texas earned pensions without paying into Social Security, and rules for those benefits changed in 2025. If that fits your situation, ask a planner to run your numbers using current rules. Our retirement planning guide explains the basics of claiming.

Moving to the Hill Country

Some retirees sell in the city and move to Boerne, New Braunfels, Fair Oaks Ranch, Bulverde or around Canyon Lake. Others go farther to Kerrville or Fredericksburg. Lower-density living appeals, and sale proceeds from a home in Alamo Heights or Stone Oak can fund a cottage and a cushion.

Costs follow you, though. Rural homes may face higher insurance, wells and septic upkeep, wildfire and flood risks, and longer drives to specialists. Appraisal rules differ by county, so look up the tax history on any property and keep your homestead exemption in mind when you move. If you buy acreage, ask about its agricultural valuation and what happens to it when you build.

Heat, utilities and the retiree budget

San Antonio summers are long. Air conditioning can push a monthly electric bill far above the spring level, and the February 2021 freeze showed that winter can also be costly through burst pipes and outages. A retiree budget should include utility spikes, a roof and air conditioner replacement fund, and a plan for repairs on an older house. Many retired households set aside a few thousand dollars a year for the home alone.

Homeowners over 65 can ask about the tax limits on school taxes and the option to defer payment. The aim is to make sure your budget stays workable if rates rise or your income shifts. Confirm details with the Bexar Appraisal District each year.

A retirement income example

Robert, 58, retired as a master sergeant at 42 and now works as a civilian on the base. His wife Elena, 56, is a school administrator in the Northside district. Between them they have retired pay, a TSP balance of $410,000, a teacher pension that will start at 60, and a paid-down house in Helotes.

Their planner might suggest that Robert keep contributing to his workplace plan while retired pay covers living costs, hold off on Social Security until 67 or 70, and use the years between jobs to convert part of the TSP to Roth at a low federal bracket. Elena would decide between pension options that leave a survivor benefit. The two would put money in cash for home repairs and review the Survivor Benefit Plan choice before it becomes permanent.

Drawing down the accounts

The order in which you withdraw matters. A common approach is to spend taxable accounts first, let tax-deferred accounts grow longer, and use Roth money in high-tax years or for large bills. Required minimum distributions from traditional accounts begin in your seventies, and the start age depends on your birth year. Because Texas has no income tax, the sequencing question is mostly about federal brackets, Medicare premium surcharges tied to income, and taxes on Social Security benefits.

Long-term care and what Medicare does not cover

Medicare pays little for long stays in a nursing facility or for help at home. Families in San Antonio often see this firsthand, with a parent living in an assisted living community or receiving care from a relative. Options include long-term care insurance bought in your fifties or early sixties, a hybrid life policy with a care rider, or self-funding from savings. Texas Medicaid can help those with limited assets, and the state may seek repayment from an estate afterward, so talk with an elder law attorney before you transfer anything. Our estate planning guide lists the documents to have in place.

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Taxes in the first years of retirement

The years right after you stop working are often the lowest-income years of your life, and that is when tax planning pays off most. With no Texas income tax in the way, you can fill the lower federal brackets by converting part of a traditional account to Roth, or by selling appreciated investments in a taxable account, before Social Security and required distributions push your income up. A couple in their early sixties might convert $30,000 a year for a few years, paying the tax from savings, so that later withdrawals are smaller and easier to manage. Our tax planning guide covers brackets and conversions in more detail, and your accountant should run the numbers each year because rules and thresholds change.

Staying safe from scams

Older adults are frequent targets of fraud. Warning signs include pressure to act today, requests for gift cards or wire transfers, and anyone who says your money is not safe at the bank. Ask for the advisor’s registration, check it on the SEC adviser search and the Texas State Securities Board, and do not give account access to someone who contacts you out of the blue.

Leaving something to the family

Texas has no estate tax or inheritance tax, so most families only watch the federal threshold. Beneficiary designations on the TSP, IRAs and life insurance override a will, so check them after any marriage, divorce or death. A transfer on death deed can pass a home to a named person outside probate, and a power of attorney and medical directive let someone act if you cannot. Community property rules affect couples, so review the titles with an attorney.

Working part time and phasing out

Many San Antonio retirees keep a part-time job in healthcare, education, security or the tourism trade. Earnings before full retirement age can reduce Social Security benefits temporarily, and extra income can raise Medicare premiums later. A short plan for the first three years of retirement, with a target for work income, helps you avoid surprises. Our life insurance guide is also worth a look when you decide how much coverage to keep into retirement.

Questions to ask a retirement planner

Ask how many clients the planner has with military and federal benefits, whether they act as a fiduciary, how fees are charged, and how often they will revisit the plan. Ask what happens to the plan if you or your spouse dies, and request the answers in writing. Compare at least two before choosing.

Frequently asked questions