Insurance & Financial Planning in Austin, TX

No. Texas has no personal income tax, so an Austin retiree pays no state tax on Social Security, an ERS or TRS pension, IRA or 401(k) withdrawals, or the gain on a large stock sale. The bill that does not go away is property tax, and in Austin an appraisal that has climbed for years keeps the Travis County bill high after the mortgage is paid, even with a homestead exemption. Medicare adds a federal income test: the 2026 IRMAA surcharge starts above $109,000 of modified adjusted gross income for a single filer and $218,000 for a couple, the base Part B premium is $202.90 a month, and the cliff brackets are set on income from two years earlier. For tech households, the year a concentrated equity position is sold can cross one of those cliffs, so the years before required minimum distributions are used for Roth conversions and a deliberate order of sales and withdrawals.

Often only partly, and that is the most common gap in Austin. Tech-employer group long-term disability replaces a percentage of base salary up to a monthly cap and generally excludes bonus, RSUs, and other equity, so an engineer whose package is equity-heavy can be insured for a fraction of what the household actually lives on. Group life is usually a fixed multiple of base salary and understates the need the same way. Both end when the job does, and Austin careers move between startups and large employers often, sometimes through a layoff. State and university employees face their own plan limits. An individually owned policy sized to total compensation is portable, can be own-occupation, and stays in force through job changes; reading the benefits summary first keeps it from duplicating what the employer already provides.

Austin's median household income was about $91,461 in 2024 (U.S. Census via Data USA) and homeownership was 43.4%, with a median property value of about $555,300, so most Austin households rent and the ones who own carry large mortgages. A common starting point is 10 to 12 times gross income plus the mortgage balance and expected education costs, minus existing assets; for a two-earner tech household with an Austin mortgage that often lands at $2M or more combined, and higher when unvested equity that would be lost is counted. Renters need income replacement too, because Austin rent, childcare, and car payments continue if a paycheck stops. Each earner generally needs coverage sized to their own total pay, and a new grant, a liquidity event, or a first home purchase is a natural time to revisit the figure.

The Genworth/CareScout Cost of Care Survey (2024) puts Texas assisted living at roughly $4,915 per month on average, below the national figure, with nursing care higher and Austin-area communities ranging around the average by level of care. A multi-year care need can still exceed $250,000 to $400,000, and in Austin it often lands first on parents who moved here to be near grandchildren and on the adult children who take them in. Texas runs a Long-Term Care Partnership program through the Health and Human Services Commission: each dollar of benefits a qualified Partnership policy pays protects a dollar of assets from Medicaid spend-down and estate recovery. Texas homestead law separately shields the primary residence, which in Austin is often the household’s largest asset. Starting coverage in your 50s generally leaves more choices than seeking it after a diagnosis.

Texas is a community property state, so a life insurance policy funded with income earned during the marriage, along with RSUs and options that vested in the same years, is generally owned by both spouses, and naming a non-spouse beneficiary on such a policy can require spousal consent. Couples naming one another rarely encounter a problem. The cases that call for review in Austin are founders with co-founder or investor agreements, second marriages where equity vested in the first, and couples who moved from a common-law state with documents drafted under different rules. Beneficiary designations override a will, and an old designation on a former employer’s plan or brokerage account is among the most common and costly estate mistakes an Austin household can make.