When calculating how much second income an investment will bring, there are several ways to look at it.

Many investors only count dividends as income, even if the stock has produced significant capital gains. This is because paying out stock profits would reduce the number of shares you own.

Still, since you can technically withdraw your funds at any time and still have the equivalent invested value, it’s fair to consider your total return as income.

For example, RioTinto (LSE: RIO) is not the most profitable on the market FTSE100at a level of approximately 4.2%. However, the share price has risen almost 66% in the last year to £71.60.

This equates to a solid annual total return of around 70%.

So 1,000 shares bought a year ago, when the price was £42.45, would have cost £42,450. Today that same investment would grow to around £75,348, including dividends.

That’s a staggering £32,898 that can be withdrawn as a ‘second income’.

Let’s see how Rio Tinto got here.

Solid demand for mining

Mining was one of the strongest sectors last year, and Rio Tinto benefited from this development. Copper currently accounts for around 30% of Rio Tinto’s profits, while iron ore accounts for around 60% of the group’s total income.

This is key to the growth narrative as copper is linked to electrification, power grids and data centers – all of which support demand.

But lithium is an even bigger part of the story. Jérôme Pécresse from Rio Tinto said: “Lithium demand over the next two years will be much more balanced between electric vehicles and energy storage.”

This is encouraging, pointing to a broader market than just electric cars. Rio’s latest annual results also showed underlying EBITDA of $25.4 billion and stronger operating cash flow, helping to sustain the dividend.

To sum up:

• Copper has become a bigger driver of profits.
• Lithium could add another leg of growth.
• The dividend remains supported by mighty cash generation.

A risk worth watching

Growth aside, I wouldn’t ignore the warning signs. Some market commentators believe the mining rally may be losing momentum, a RBC On June 2, 2026, Capital Markets downgraded Rio Tinto from Sector Perform to Underperform. At the same time, the broker changed its price target to £64, suggesting caution rather than enthusiasm.

There are also broader valuation risks. Rio has already had a good run, so expectations are higher now than they were a year ago. If iron ore weakens or Chinese demand fails, the share price could quickly move in the wrong direction.

Therefore, mining resources can be rewarding, but they are rarely peaceful.

The most essential thing

In my opinion, Rio Tinto shows how dividend stocks can become a great second income when capital gains are added to the payout. However, it is generally considered best practice to reinvest dividend earnings and accumulate them over the long term.

Rio has had a good run, but it’s still a cyclical mine, not a sleepy moneymaker. As such, I would only consider it a compact position in a diversified portfolio where it can enhance returns without taking over the entire plan.

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Mark Hartley holds no position in the companies mentioned.