Investors planning their retirement finances should benefit from investing in relatively less-risky equities, given the higher average returns than bonds and Treasury securities. Industry leaders Walmart (NYSE:WMT), Flower Foods (FLO), and Group1 Automotive (GPI) with stable dividend payouts could be solid additions to one’s retirement portfolio.The Fed's continued loose monetary policy has affected retirees relying on periodic interest payouts on fixed-income instruments to sustain their livelihood. The third installment of the Economic Impact Payments authorized under the American Rescue Plan Act of 2021 distributed stimulus checks to eligible retirees. However, with the government currently focused on revamping the economy through infrastructure investments following disappointing second-quarter GDP results, it is unlikely that retirees will get any further stimulus assistance in the near term.
Equities have historically outperformed the bond and fixed income securities. For example, stocks have returned 9.6% annually since the Great Depression in 1929, 40% higher than bonds, which have returned 5.6% annually over this period. Goldman Sachs (NYSE:GS) analysts expect the benchmark S&P 500 index to generate 6% median annualized returns over the next 10 years, with a 90% probability of outperforming bonds through 2030. Moreover, 25% of the total shareholder returns are expected to come from dividends.
Given this backdrop, large-cap companies Walmart Inc. (WMT), Flower Foods, Inc. (FLO), and Group 1 Automotive, Inc. (NYSE:GPI), which possess solid fundamentals and pay stable dividends, could be wise retirement investments.