BALTIMORE (Stockpickr) -- The S&P 500 may be pushing up against new all-time highs this month, but whatever you do, don't forget about dividends.
When capital gains are running rampant, it's easy to forget about dividend payouts. While income stocks are a safety net for investors when markets turn sour, they're easily eschewed when the stock market is on track for double-digit percentage gains (as of yesterday's close, the S&P is on track for an 11.7% price bump in 2014). But that's a big mistake. Factoring dividend payouts in materially boosts your returns, even on a short year-to-date basis. Include dividends in the recipe, and suddenly the S&P is on pace for a 14% return this year.
2014 isn't an anomaly either. As I write, U.S. corporations are paying out record dividends thanks to a record pile of cash on corporate balance sheets. And, while few folks realize it, the dividend yield of the S&P 500 is hovering in a range higher than we've seen in any sustained period since the mid-1990s. Adjusting for the incredibly low yields on treasuries, dividend payouts are massive right now.