Here's an eye-opening statistic: older Americans are more afraid of running out of money than of death itself.And retirees have good reason to be worried about making their assets last. People are living longer, so that money has to cover a longer period. Making matters worse, income generated using tried-and-true retirement planning approaches may not cover expenses these days. That means seniors must dip into principal to meet living expenses.Your parents' retirement investing plan won't cut it today.For many years, bonds or other fixed-income assets could produce the yield needed to provide solid income for retirement needs. However, these yields have dwindled over time: 10-year Treasury bond rates in the late 1990s were around 6.50%, but today, that rate is a thing of the past, with a slim likelihood of rates making a comeback in the foreseeable future.That means if you had $1 million in 10-year Treasuries, the difference in yield between 1999 and today is more than $1 million.In addition to the considerable drop in bond yields, today's retirees are nervous about their future Social Security benefits. Because of certain demographic factors, it's been estimated that the funds that pay the Social Security benefits will run out of money in 2035.So what's a retiree to do? You could cut your expenses to the bone, and take the risk that your Social Security checks don't shrink. Or you could find an alternative investment that provides a steady, higher-rate income stream to replace dwindling bond yields.Invest in Dividend StocksAs a replacement for low yielding Treasury bonds (and other bond options), we believe dividend-paying stocks from high quality companies offer low risk and stable, predictable income investors in retirement seek.Look for stocks that have paid steady, increasing dividends for years (or decades), and have not cut their dividends even during recessions.One way to identify suitable candidates is to look for stocks with an average dividend yield of 3%, and positive average annual dividend growth. Many stocks increase dividends over time, helping to offset the effects of inflation.Here are three dividend-paying stocks retirees should consider for their nest egg portfolio.Acadia Realty Trust (AKR) is currently shelling out a dividend of $0.18 per share, with a dividend yield of 4.87%. This compares to the REIT and Equity Trust - Retail industry's yield of 4.22% and the S&P 500's yield of 1.63%. The company's annualized dividend growth in the past year was 20%. Check Acadia Realty Trust (AKR) dividend history here>>>Peoples Bancorp (PEBO) is paying out a dividend of $0.38 per share at the moment, with a dividend yield of 5.2% compared to the Banks - Midwest industry's yield of 2.36% and the S&P 500's yield. The annualized dividend growth of the company was 5.56% over the past year. Check Peoples Bancorp (PEBO) dividend history here>>>Currently paying a dividend of $0.24 per share, Provident Financial (PFS) has a dividend yield of 4.31%. This is compared to the Financial - Savings and Loan industry's yield of 2.58% and the S&P 500's current yield. Annualized dividend growth for the company in the past year was 4.35%. Check Provident Financial (PFS) dividend history here>>>But aren't stocks generally more risky than bonds?The fact is that stocks, as an asset class, carry more risk than bonds. To counterbalance this, invest in superior quality dividend stocks that not only can grow over time but more significantly, can also decrease your overall portfolio volatility with respect to the broader stock market.A silver lining to owning dividend stocks for your retirement portfolio is that many companies, especially blue chip stocks, increase their dividends over time, helping offset the effects of inflation on your potential retirement income.Thinking about dividend-focused mutual funds or ETFs? Watch out for fees.If you prefer investing in funds or ETFs compared to individual stocks, you can still pursue a dividend income strategy. However, it's important to know the fees charged by each fund or ETF, which can ultimately reduce your dividend income, working against your strategy. Do your homework and make sure you know the fees charged by any fund before you invest.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. FREE Report: The Metaverse is Exploding! Don’t You Want to Cash In? Rising gas prices. The war in Ukraine. America's recession. Inflation. It's no wonder why the metaverse is so popular and growing every day. Becoming Spider Man and fighting Darth Vader is infinitely more appealing than spending over $5 per gallon at the pump. And that appeal is why the metaverse can provide such massive gains for investors. But do you know where to look? Do you know which metaverse stocks to buy and which to avoid? In a new FREE report from Zacks' leading stock specialist, we reveal how you could profit from the internet’s next evolution. 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