The wealth-building power of compound interest will never cease to amaze me. It's a story of patience and attention to detail, where small, short-term differences add up to massive divergence over decades. And in the end, the biggest winners don't always deliver the fattest share-price returns.

Brand-new Dow Jones (DJINDICES:^DJI) component Goldman Sachs (NYSE:GS) has paid a steady dividend since 1999. Quarterly payouts have doubled in the last decade, which works out to an annual 7.5% boost on average. The financial powerhouse often goes several years without raising its dividends, and the financial panic of 2008 forced Goldman to back off an increased policy hike. So we're not exactly looking at a solid-gold dividend aristocrat here.

GS Dividend Chart

GS Dividend data by YCharts.

To make matters worse for income investors with an eye on Goldman, the payouts have never really looked generous. The current 1.2% yield is high in the context of Goldman's payout history, but is among the lowest dividend yields on the Dow. Fellow Dow bank JPMorgan Chase (NYSE:JPM) rarely dips below 2% and currently offers an above-average 2.9% yield. JPMorgan slashed its dividend checks hard in the aftermath of 2008, and temporarily offered a lower yield than Goldman, but the bigger bank's dividends came roaring back in 2011 and haven't looked back.

Or you can look at Intel (NASDAQ:INTC) as a role model. The tech stock with longtime Dow ties used to pay a minuscule dividend, but showed a serious commitment to raising payouts over the last 10 years. The result? Intel passed Goldman's yield in 2005 and JPMorgan's in 2009, and now provides the third-highest yield among the 30 Dow stocks.

GS Dividend Yield (TTM) Chart

GS Dividend Yield (TTM) data by YCharts

Intel and JPMorgan show that dividend increases are possible even when the economy goes crazy for a few years. And here's another kicker: Goldman has almost always had plenty of headroom to boost those quarterly checks but still chose not to do it. The company currently funnels just 14% of its net income into dividend payments, far lower than JPMorgan's 22% or Intel's 47%. In fact, it's the lowest payout ratio on the Dow.

In the end, these paltry payouts boosted Goldman's returns by a modest 22% in the last decade. Reinvesting dividends in the SPDR Dow Jones Industrial Average (NYSEMKT:DIA) Dow tracker yielded a 41% boost.

GS Chart

GS data by YCharts.

Goldman Sachs really has no excuses to keep its dividends this low. Until Goldman adopts a more shareholder-friendly payout policy, this stock remains almost a pure growth and value play. Income investors are better served elsewhere.

Fool contributor Anders Bylund owns shares of Intel, but he holds no other position in any company mentioned. Check out Anders' bio and holdings or follow him on Twitter and Google+.

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