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                            PRIVATE INVESTMENT CLASS
                                     OF THE
                             CASH RESERVE PORTFOLIO
                                       OF
                            TAX-FREE INVESTMENTS CO.

                      Supplement dated September 12, 1997
                     to the Prospectus dated July 29, 1997


         The following sentence is added to the section entitled "INVESTMENT
PROGRAM":


         "Securities in which the Portfolio invests may be insured by financial
insurance companies.  Since a limited number of entities provide such
insurance, the Portfolio may invest more than 25% of its assets in securities
insured by the same insurance company."



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