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T. ROWE PRICE
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Tax-Efficient Balanced Fund, Inc.
Supplement to prospectus dated July 1, 1998
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Effective March 1, 1998, footnote (b) to Table 1 on page 2 of the Prospectus
will be revised with the following to reflect the extension of the fund's
expense ratio limitation:
/b/
To limit the fund's expenses during its initial period of operations, T. Rowe
Price agreed to waive its fees and bear any expenses through February 28, 1999,
that would cause the fund's ratio of expenses to average net assets to exceed
1.00%. Effective March 1, 1999, T. Rowe Price agreed to extend the expense
limitation for an additional two-year period through February 28, 2001. Fees
waived or expenses paid or assumed under these agreements are subject to
reimbursement to T. Rowe Price by the fund whenever the fund's expense ratio is
below 1.00%; however, no reimbursement will be made after February 28, 2001
(for the first agreement), or February 28, 2003 (for the second agreement), or
if it would result in the expense ratio exceeding 1.00%. Any amounts reimbursed
will have the effect of increasing fees otherwise paid by the fund. Without
these agreements, the fund's management fee, other expenses, and total expense
ratio would have been 0.52%, 1.69%, and 2.21%, respectively.
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The date of the above supplement is March 1, 1999.
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Effective immediately, the paragraph under Portfolio Management on page 17 of
the prospectus will be replaced with the following:
The fund has an Investment Advisory Committee with the following members:
William F. Snider and Donald J. Peters, Co-chairmen, Mary J. Miller, William J.
Stromberg, and Arthur S. Varnado. The committee co-chairmen have day-to-day
responsibility for managing the fund and work with the committee in developing
and executing the fund's investment program. Mr. Snider joined T. Rowe Price in
1991 and has been managing investments since 1993. Mr. Peters has been managing
investments since joining T. Rowe Price in 1993.
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The date of the above supplement is April 15, 1999.
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F19-041 4/15/99
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