<PAGE> 1
VANGUARD/WELLINGTON FUND, INC.
PROSPECTUS SUPPLEMENT
FEBRUARY 2, 1996
The Board of Directors of Vanguard/Wellington Fund, Inc. (the "Fund") has
approved a revised investment advisory agreement with Wellington Management
Company ("WMC"), the Fund's investment adviser. The new agreement involves a
reduction in the annual rate of advisory fees to be paid to WMC.
Under the terms of the new agreement, the Fund will pay WMC a basic
advisory fee at the end of each fiscal quarter, calculated by applying the
following annual percentage rates, to the Fund's average month-end net assets
for the quarter:
<TABLE>
<CAPTION>
NET ASSETS ANNUAL BASIC FEE RATE
---------- ---------------------
<S> <C>
First $1 billion 0.100%
Next $2 billion 0.050
Next $7 billion 0.040
Over $10 billion 0.030
</TABLE>
Both the current and revised agreements provide that the basic fee may be
increased or decreased by applying an incentive/penalty fee adjustment based on
the investment performance of the Fund relative to the investment record of a
"composite index" 65% of which shall be comprised of the Standard & Poor's 500
Composite Stock Price Index and 35% of which shall be comprised of the Lehman
Long-Term Corporate AA or Better Bond Index.
The following table sets forth the incentive/penalty adjustment to the
basic advisory fee payable by the Fund to WMC under the new advisory agreement:
<TABLE>
<CAPTION>
Cumulative 36- Month Performance Fee
Performance versus the Composite Index Adjustment
-------------------------------------- ----------
<S> <C>
Less than -6% -0.30 x Basic Fee*
Between -3% and -6% -0.15 x Basic Fee
Between -3% and 3% 0 x Basic Fee
Between 3 and 6% 0.15 x Basic Fee
More than 6% 0.30 x Basic Fee
</TABLE>
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* For purposes of this calculation, the Basic Fee is calculated by applying
the quarterly rate based on the Annual Basic Fee Rate using average assets over
the same 36-month period over which the performance is measured.
Under the rules of the Securities and Exchange Commission, the new
incentive/penalty fee will not be fully operable until the quarter ending May
31, 1999, and until that date, will be calculated according to certain
transition rules. This revised investment advisory agreement replaces the
Fund's existing agreement with the adviser dated as of April 1, 1993, and will
go into effect on or about March 1, 1996. Until this date, the adviser has
agreed to waive its advisory fees to the extent necessary to abide by the new
fee schedule.
AFWT
