In vague and somewhat inaccurate terms, the output of the FFT is the magnitude and phase of all[1] frequencies. That is, your statement, "[The FFT] tells you the most dominant frequency (magnitude) at any given time" is incorrect. The FFT is often used as a first step to determine the most dominant frequency, but that's not what it does. In fact, if you are interested in the most dominant frequency, you need to take extra steps over and beyond the FFT: you take the magnitude of all frequencies output by the FFT, and then find the maximum. The corresponding frequency is the dominant frequency.
For your application as I understand it, the FFT is the correct algorithm.
The Goertzel algorithm is closely related to the FFT. It allows for some optimization over the FFT if you are only interested in the magnitude and/or phase of a small subset of frequencies. It might be the right choice for your application depending on the number of frequencies in question, but only as an optimization -- other than performance, it won't solve any problems the FFT won't solve. Because there is more written about the FFT, I suggest you start there and use the Goertzel algorithm only if the FFT proves to not be fast enough and you can establish the Goertzel will be faster in your case.
[1] For practical purposes, what's most inaccurate about this statement is that the frequencies are grouped together in "bins". There's a limited resolution to the analysis which depends on a variety of factors.