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VANGUARD FIXED INCOME SECURITIES FUND, INC.
PROSPECTUS SUPPLEMENT
FEBRUARY 2, 1996
The Board of Directors of Vanguard Fixed Income Securities Fund, Inc., (the
"Fund") has approved revised investment advisory agreements with Wellington
Management Company ("WMC"), investment adviser for the Fund's GNMA, Long-Term
Corporate, and High Yield Corporate Portfolios. The new agreements involve a
reduction in the annual rates of advisory fees to be paid to WMC.
GNMA PORTFOLIO
Under the terms of the new agreement for the GNMA Portfolio, the Fund will
pay WMC a basic advisory fee at the end of each fiscal quarter based on the
Portfolio's average month-end net assets during the quarter. The quarterly
rate is applied according to the following annual fee schedule:
<TABLE>
<CAPTION>
NET ASSETS ANNUAL BASIC FEE RATE
---------- ---------------------
<S> <C>
First $3 billion 0.020%
Next $3 billion 0.010
Over $6 billion 0.008
</TABLE>
LONG-TERM CORPORATE PORTFOLIO
Under the terms of the new agreement for the Long-Term Corporate
Portfolio, the Fund will pay WMC a basic advisory fee at the end of each fiscal
quarter based on the Portfolio's average month-end net assets during the
quarter. The quarterly rate is applied according to the following annual fee
schedule:
<TABLE>
<CAPTION>
NET ASSETS ANNUAL BASIC FEE RATE
---------- ---------------------
<S> <C>
First $1 billion 0.040%
Next $1 billion 0.030
Next $1 billion 0.020
Over $3 billion 0.015
</TABLE>
HIGH YIELD CORPORATE PORTFOLIO
Under the terms of the new agreement for the High Yield Corporate
Portfolio, the Fund will pay WMC a basic advisory fee at the end of each fiscal
quarter based on the Portfolio's average month-end net assets during the
quarter. The quarterly rate is applied according to the following annual fee
schedule:
<TABLE>
<CAPTION>
NET ASSETS ANNUAL BASIC FEE RATE
---------- ---------------------
<S> <C>
First $1 billion 0.060%
Next $1 billion 0.040
Next $1 billion 0.030
Over $3 billion 0.025
</TABLE>
These revised investment advisory agreements replace each Portfolio's
original agreement with the adviser dated May 31, 1993, and will go into effect
on or about May 1, 1996. Until the effective date, the adviser has agreed to
waive its advisory fees to the extent necessary to abide by the new fee
schedules.
AFFI
