THE COLONIAL FUND
Supplement to the February 27, 1998 Class Z Share Prospectus
The Fund's Prospectus is amended as follows:
(1) To the front cover of the Prospectus, a new paragraph is
added below the Table of Contents as follows:
The SEC maintains a Web site (http://www.sec.gov) that
contains the Statement of Additional Information, materials
that are incorporated by reference into this Prospectus and
the Statement of Additional Information, and other
information regarding the Fund.
(2) The sub-caption "Borrowing of Money" under the caption
HOW THE FUND PURSUES ITS OBJECTIVE AND CERTAIN RISK FACTORS is
revised in its entirety as follows:
Borrowing of Money. The Fund may borrow money from banks,
other affiliated funds and other entities to the extent
permitted by law for temporary or emergency purposes up to
33 1/3% of its total assets.
(3) A new caption and paragraph is added after the last
paragraph of the caption HOW THE FUND IS MANAGED as follows:
YEAR 2000
The Fund's Advisor, Distributor and Transfer Agent (Liberty
Companies) are actively managing Year 2000 readiness for
the Fund. The Liberty Companies are taking steps that they
believe are reasonably designed to address the Year 2000
problem and are communicating with vendors who provide
services, software and systems to the Fund to provide that
date-related information and data can be properly processed
and calculated on and after January 1, 2000. Many Fund
service providers and vendors, including the Liberty
Companies, are in the process of making Year 2000
modifications to their software and systems and believe
that such modifications will be completed on a timely basis
prior to January 1, 2000. The Fund will not pay the cost
of these modifications. However, no assurances can be
given that all modifications required to ensure proper data
processing and calculation on and after January 1, 2000
will be timely made or that services to the Fund will not
be adversely affected.
(4) A new sentence is added as the last sentence under the
caption HOW THE FUND VALUES ITS SHARES as follows:
In addition, if the values of foreign securities have been
materially affected by events occurring after the closing
of a foreign market, the foreign securities may be valued
at their fair value.
(5) Under the caption TELEPHONE TRANSACTIONS the first
sentence is revised in its entirety and new second and third
sentences are added as follows:
All shareholders and/or their financial advisors are
automatically eligible to exchange Fund shares and to
redeem up to $100,000 of Fund shares by calling 1-800-422-
3737 toll-free any business day between 9:00 a.m. (Eastern
time) and the time at which the Fund values its shares.
Telephone redemptions are limited to a total of $100,000 in
a 30-day period. Redemptions that exceed $100,000 may be
accomplished by placing a wire order trade through a broker
or furnishing a signature guaranteed request.
(6) Liberty Financial Investments, Inc. (Transfer Agent), the
Fund's distributor, changed its name to Liberty Funds
Distributor, Inc. (Distributor). The new name will not affect
the services the Distributor provides to the Fund. The
Distributor continues to offer selected investment products
managed by subsidiaries of its indirect parent company,
Liberty Financial Companies, Inc. (NYSE:L).
(7) Colonial Investors Service Center, Inc. (Transfer Agent),
the Fund's transfer agent, changed its name to Liberty Funds
Services, Inc. The new name will not affect the services the
Transfer Agent provides to the Fund.
(8) Price Waterhouse LLP, the Fund's independent accountants,
changed its name to PricewaterhouseCoopers LLP. The new name
will not affect the services the independent accountants
provide to the Fund.
TF-36/278G-1198
October 30, 1998
