Social Security benefits are a major source of income for millions of retirees. In fact, nearly nine in 10 Americans say their benefits will make up at least a portion of their income in retirement, according to a poll from Gallup.

However, the average retiree only receives around $1,500 per month from Social Security, data from the Social Security Administration shows. For many retirees, benefits alone won't be enough to pay the bills.

To supplement your Social Security benefits, you may choose to invest in stocks. Investing in the stock market is one of the most effective ways to build a strong nest egg, but there are some stocks that can also provide passive income in retirement. And if you invest enough money in the right stocks, these investments could pay you even more than Social Security benefits.

Older man smiling and holding hundred dollar bills

Image source: Getty Images.

How to earn passive income from stocks

Not all stocks provide passive income in retirement; the ones that do are called dividend stocks. Companies that pay dividends are usually large, profitable corporations. When they have extra cash at the end of the quarter or year, rather than investing all of it back into the business, they may choose to pay a portion of it back to shareholders in the form of a quarterly dividend.

When you receive a dividend payment, you can either invest it back into your stock or cash it out. Reinvesting it is a smart option when you're still working, because the more shares of stock you own, the more you'll receive in dividends. But once you retire, you may choose to cash out your dividend payments as a source of passive income.

Also, not all dividend stocks are created equal. Some companies suspend their dividends during tough economic times, while others have been increasing their dividend payments every year for decades. The Dividend Aristocrats are an elite group of companies that have increased their dividend every year for at least 25 consecutive years, so if you're looking for more consistent dividend payments, choosing stocks from this list may be the way to go.

How much you can earn in dividends will depend on which stocks you're investing in and how many shares you own. Here are a few options, as well as how much you'd need to invest in each stock to earn more than the average Social Security payment in dividends.

1. Chevron

Chevron (NYSE:CVX) is part of the Dividend Aristocrats group, having increased its dividend every year for 32 consecutive years. It currently pays a quarterly dividend that totals $5.16 annually, meaning that for each share you own, you'll receive $5.16 per year in dividend payments.

The average Social Security benefit amount is roughly $1,500 per month, or around $18,000 per year. To receive more than that in dividend payments, you'd need to own approximately 3,488 shares of Chevron stock. As of Dec. 28, Chevron stock costs roughly $85 per share. So to earn at least $1,500 per month in dividend payments, you'd need to have close to $296,500 invested in this stock.

While that number may seem unrealistic, remember that you don't need to invest that much all at once. If you invest consistently for years and also reinvest any dividend payments you receive during that time, it will be easier to invest a significant amount of money.

2. AbbVie

Healthcare company AbbVie (NYSE:ABBV) is another member of the Dividend Aristocrats, and it has increased its dividend by 195% since 2013. It currently pays $5.20 per year in total quarterly dividends, so you'd need around 3,462 shares of this company to earn at least $1,500 per month in dividend payments.

This stock is a little pricier at around $103 per share, so you'd need to invest a total of around $356,600 in this stock to earn more than you would with Social Security.

3. ExxonMobil

ExxonMobil (NYSE:XOM) has been paying dividends for more than 100 years. It's also part of the Dividend Aristocrats group, having increased its dividend by around 6% per year, on average, over the past 38 years.

This company currently has a quarterly dividend that totals $3.48 per year, meaning you'd need around 5,172 shares of this stock to earn as much as you would with Social Security. This stock is more affordable than the others on the list, however, with a current stock price of around $41 per share. That means you'd need to invest a total of around $212,000 to earn at least $1,500 per month in dividend payments.

Building a balanced portfolio

As you're saving for retirement, it's crucial to make sure you're diversifying your investments. Investing all your money into a single stock can be a recipe for disaster, so it's wise to spread your savings across at least 10 to 15 different stocks to limit your risk.

Even if you can't invest enough in dividend stocks to earn thousands of dollars per month in passive income, that doesn't mean these stocks aren't a smart investment. By investing in solid companies that are paying consistent dividends, you can boost your retirement income and enjoy your senior years more comfortably.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.