Wal-Mart (WMT) has had a rough year, as has just about any company in the grocery business besides Whole Foods (NASDAQ:WFM). With Amazons (NASDAQ:AMZN) purchase of Whole Foods, the entire grocery industry is shaking in their boots.

But Wal-Mart is no ordinary grocer. In many ways, they are already Amazon and Whole Foods wrapped into one. It may have gone unnoticed by some, but Wal-Marts website and web presence in general has improved dramatically over the years.

Wal-Mart has worked very hard to establish their online presence and it is finally beginning to pay big dividends for them. They purchased online retailer Jet.com for $3 billion, which shows their commitment to the online retail world. And of course they already have their stores all over the country, which gives them the distribution they need to compete against the Amazon and Whole Foods merger.

If you believe Wal-Mart will survive and even thrive in what is becoming a new era in online shopping, then read on and find out how Wal-Mart might save your retirement portfolio.

Running out of money in retirement is something so many people dread. If you dont believe me, take a look at the charts below.

Many people approaching retirement have reason to be concerned. With interest rates so low and probably low for years to come, there is very little income to be had from bonds these days. Many retirees just ten years ago lived off of bond interest payments alone.

Its hard to believe, but in 2007 when interest rates were more than double the level they are today, many people could retire on 100% treasury bonds. Lets take a look at an example of this. I ran a retirement scenario in the WealthTrace Planner and my assumptions are below:

Inflation (CPI)

2.3%

Current Age of Both People

55

Age Of Retirement

65

Age When Both People Have Passed Away

85

Social Security at age 67 (combined)

$34,000 per year

Average Savings Rate

20% on Income of $150,000

Total Investment Balance Today

$600,000

Recurring Annual Expenses in Retirement

$54,000

Investment Mix

70% U.S. Value Stocks, 30% Treasuries. Changes to 100% Treasuries at Retirement

Investment Location

40% in taxable accounts, 60% in IRAs

Return Assumption Value Stocks

6.8% per year

Standard Deviation Value Stocks

16.20%

Return Assumption Treasuries

5% per year

Standard Deviation Treasuries

7.20%

The chart below shows this couples retirement income vs. expenses through time. Notice how they cover their expenses in every single year with just their social security and bond income. That would be impossible today.

How would this couple fair today with ten-year treasury yields at 2.2%? See the chart below for the answer.

The best alternative to treasuries for retirement, in my opinion, is now solid dividend-growth stocks. I believe most investors, both pre-retirement and in retirement, should have a healthy dose of strong dividend-growth stocks in their retirement portfolio. Wal-Mart fits perfectly for this.

Wal-Marts dividend yield is currently 2.6%. The five-year growth rate of its dividend is 6.5%. They have also never cut their dividend, and even increased it during the last recession.

Keep in mind that I am not recommending that investors put all of their money into one stock. We want to find a basket of stocks similar to Wal-Mart in order to diversify. Others that I have recommended before are Altria (MO), Exxon (XOM), and Procter & Gamble (PG).

Lets see what happens to this couples retirement plan today if we put them into a basket of dividend payers that have characteristics similar to Wal-Marts.

The income being thrown off by these dividend payers has saved this couples retirement plan. They now have enough income to cover their expenses.

Anybody approaching or in retirement needs to think long and hard about how they will generate enough income in order to meet their expenses. It should be their number one priority in terms of their retirement plan. With some diligent research, there are still great companies that can be found who pay a decent dividend along with solid dividend growth over time.

Disclosure: I am/we are long WMT, XOM, PG, MO.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Look To Wal-Mart To Help Your Retirement Portfolio - Seeking Alpha