My intent in writing is to challenge the assumption made by Kathy Nicholes (and many others in local/national media) that somehow each recipient of Social Security retirement benefits will receive "in just three or four years" what they paid in over their entire lifetime. This is a grossly misleading idea when you allow for interest.

The basic premise is that what we pay in must be assumed to have been invested and earning interest over the 30-40 years of contributions. The only real question is what rate of interest is "fair." If I take myself as a typical example, I paid into the system from 1955 to 1995. I paid a total of $58,362 (before any interest consideration). Yes, this includes the Medicare portion, but I'm totally ignoring the 100 percent match my employers paid on my behalf. At 62, I'll be entitled to $955/month or $11,460/year (per Social Security Administration letter to me in November 1995). If I assume my benefits will grow 3 percent a year (COLA increases), then the following represents how long my benefits will be paid out of my own personal "investment": at 6 percent interest, my investment lasts almost 14 years; at 8 percent interest, my investment lasts just over 28 years.Since my life expectancy is 84 years (22 years beyond my retirement age), then most or all of my benefits can be thought of to come out of my own investment. If you let the interest rate grow to 9 percent, then I can never live long enough to use it up. My investment would still be worth $413,914 at the end of my 84th year (after having paid me a total of $349,961) and will continue to grow forever. Nine percent is not an extreme rate; the Dow Jones Industrial Stock average rate of increase over the past 60 years is basically 10 percent.

So it all boils down to an assumed interest rate. But please don't tell me that I received "all my contributions" in just three or four years. It simply is not true in any kind of a fair analysis. And once you acknowledge this truth, then many of the other attacks against seniors become very suspect.

Bill Matthews

West Valley City