Here's a revealing data point: older Americans are scared more of outliving wealth than of death itself.Also, retirees who have constructed a nest egg have valid justifications to be concerned, since the traditional ways to plan for retirement may mean income can no longer cover expenses. Some retirees are now tapping their principal to make a decent living, pressed for time between decreasing investment balances and longer life expectancies.Retirement investing approaches of the past don't work today.In the past, investors going into retirement could invest in bonds and count on attractive yields to produce steady, reliable income streams to fund a predictable retirement. 10-year Treasury bond rates in the late 1990s hovered around 6.50%, whereas the current rate is much lower.The effect of this drop in rates is substantial: over 20 years, the change in yield for a $1 million investment in 10-year Treasuries is over $1 million.Today's retirees are getting hit hard by reduced bond yields - and the Social Security picture isn't too rosy either. Right now and for the near future, Social Security benefits are still being paid, but it has been estimated that the Social Security funds will be depleted as soon as 2035.How can you avoid dipping into your principal when the investments you counted on in retirement aren't producing income? You can only cut your expenses so far, and the only other option is to find a different investment vehicle to generate income.Invest in Dividend StocksAs we see it, dividend-paying stocks from generally low-risk, top notch companies are a brilliant way to create steady and solid income streams to supplant low risk, low yielding Treasury and fixed-income alternatives.Look for stocks that have paid steady, increasing dividends for years (or decades), and have not cut their dividends even during recessions.Going beyond those familiar names, you can find excellent dividend-paying stocks by following a few guidelines. Look for companies that pay a dividend yield of around 3%, with positive annual dividend growth. The growth rate is key to help combat the effects of inflation.Here are three dividend-paying stocks retirees should consider for their nest egg portfolio.LCNB (LCNB) is currently shelling out a dividend of $0.21 per share, with a dividend yield of 4.64%. This compares to the Banks - Northeast industry's yield of 2.41% and the S&P 500's yield of 1.65%. The company's annualized dividend growth in the past year was 5.26%. Check LCNB (LCNB) dividend history here>>>M&T Bank Corporation (MTB) is paying out a dividend of $1.2 per share at the moment, with a dividend yield of 3.24% compared to the Banks - Major Regional industry's yield of 3.42% and the S&P 500's yield. The annualized dividend growth of the company was 9.09% over the past year. Check M&T Bank Corporation (MTB) dividend history here>>>Currently paying a dividend of $0.42 per share, NexPoint Residential Trust Inc. (NXRT) has a dividend yield of 3.27%. This is compared to the REIT and Equity Trust - Residential industry's yield of 3.29% and the S&P 500's current yield. Annualized dividend growth for the company in the past year was 11.36%. Check NexPoint Residential Trust Inc. (NXRT) dividend history here>>>But aren't stocks generally more risky than bonds?Yes, that's true. As a broad category, bonds carry less risk than stocks. However, the stocks we are talking about - dividend -paying stocks from high-quality companies - can generate income over time and also mitigate the overall volatility of your portfolio compared to the stock market as a whole.An upside to adding dividend stocks to your retirement portfolio: they can help lessen the effects of inflation, since many dividend-paying companies (especially blue chip stocks) generally increase their dividends over time.Thinking about dividend-focused mutual funds or ETFs? Watch out for fees.If you're thinking, "I want to invest in a dividend-focused ETF or mutual fund," make sure to do your homework. It's important to know that some mutual funds and specialized ETFs charge high fees, which may diminish your dividend gains or income and thwart the overall objective of this investment strategy. If you do want to invest in fund, research well to identify the best-quality dividend funds with the least charges.Bottom LineSeeking steady, consistent income through dividends can be a smart option for financial security in retirement, whether you invest in mutual funds, ETFs, or in dividend-paying stocks. Just Released: Zacks Unveils the Top 5 EV Stocks for 2022 For several months now, electric vehicles have been disrupting the $82 billion automotive industry. And that disruption is only getting bigger thanks to sky-high gas prices. Even titans in the financial industry including George Soros, Jeff Bezos, and Ray Dalio have invested in this unstoppable wave. You don't want to be sitting on your hands while EV stocks break out and climb to new highs. In a new free report, Zacks is revealing the top 5 EV stocks for investors. Next year, don't look back on today wishing you had taken advantage of this opportunity.>>Send me my free report revealing the top 5 EV stocksWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report LCNB Corporation (LCNB): Free Stock Analysis Report M&T Bank Corporation (MTB): Free Stock Analysis Report NexPoint Residential Trust, Inc. (NXRT): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research