SMITH BARNEY MONEY FUNDS, INC.
CASH PORTFOLIO
GOVERNMENT PORTFOLIO
SMITH BARNEY FUNDS, INC.
SHORT-TERM U.S. TREASURY SECURITIES PORTFOLIO
SUPPLEMENT DATED OCTOBER 7, 1996 TO PROSPECTUSES*
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The following supplements and, to the extent inconsistent therewith,
supersedes the information contained in each Fund's Prospectus under
"Purchase
of Shares--Systematic Investment Plan":
For shareholders purchasing shares of the Fund through the Systematic
Investment Plan on a monthly basis, the minimum initial investment
requirement
for Class A and Class C shares and the minimum subsequent investment
requirement for all Classes is $25. For shareholders purchasing shares
of the
Fund through the Systematic Investment Plan on a quarterly basis, the
minimum
initial investment requirement for Class A and Class C shares and the
minimum
subsequent investment requirement for all Classes is $50.
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The following information replaces in its entirety the disclosure in
the
Prospectus of each of the funds listed above (each a "Fund") under
"Purchase of
Shares--Smith Barney 401(k) Program:"
SMITH BARNEY 401(k) AND EXECCHOICE(TM) PROGRAMS
Investors may be eligible to participate in the Smith Barney 401(k)
Program
or the Smith Barney ExecChoice(TM) Program. To the extent applicable,
the same
terms and conditions, which are outlined below, are offered to all plans
participating ("Participating Plans") in these programs.
Each Fund offers to Participating Plans Class A shares as an
investment
choice under the Smith Barney 401(k) and ExecChoice(TM) Programs,
provided the
Participating Plan makes an initial investment of $1,000,000 or more of
Class A
shares of one or more funds of the Smith Barney Mutual Funds. Class A
shares
acquired through the Participating Plans are subject to the same service
and/or
distribution fees as the Class A shares acquired by other investors;
however,
they are not subject to any initial sales charge or contingent deferred
sales
charge ("CDSC").
Existing 401(k) Plans Investing in Class C shares. Class C shares of
the Fund
are not available for purchase by Participating Plans opened on or after
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June 21, 1996, but may continue to be purchased by any Participating
Plan
opened prior to such date and originally investing in such Class. Class
C
shares acquired are not subject to any sales charge or CDSC.
In any year after the date a Participating Plan enrolled in the Smith
Barney
401(k) Program, if its total Class C holdings in all non-money market
Smith
Barney Mutual Funds equal at least $500,000 as of the calendar year-end,
the
Participating Plan will be offered the opportunity to exchange all of
its Class
C shares for Class A shares of a Fund. Such Plans will be notified in
writing
within 30 days after the last business day of the calendar year and,
unless the
exchange offer has been rejected in writing, the exchange will occur on
or
about the last business day of the following March.
Any Participating Plan that has not previously qualified for an
exchange into
Class A shares will be offered the opportunity to exchange all of its
Class C
shares for Class A shares of a Fund, regardless of asset size, at the
end of
the eighth year after the date the Participating Plan enrolled in the
Smith
Barney 401(k) Program or the Smith Barney ExecChoiceTM Program. Such
Participating Plans will be notified of the pending exchange in writing
approximately 60 days before the eighth anniversary of the enrollment
date and,
unless the exchange has been rejected in writing, the exchange will
occur on or
about the eighth anniversary date. Once an exchange has occurred, a
Participating Plan will not be eligible to acquire additional Class C
shares of
the Fund but instead may acquire Class A shares of the Fund. Any Class C
shares
not converted will continue to be subject to the distribution fee.
Participating Plans wishing to acquire shares of a Fund through the
Smith
Barney 401(k) Program or the Smith Barney ExecChoice(TM) Program must
purchase
such shares directly from the Transfer Agent. For further information
regarding
these Programs, investors should contact a Smith Barney Financial
Consultant.
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* Prospectuses dated:
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<S> <C>
Smith Barney Money Funds, Inc.--
Cash Portfolio February 16, 1996
Government Portfolio February 16, 1996
Smith Barney Funds, Inc.--
Short-Term U.S. Treasury
Securities Portfolio April 1, 1996
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FD01213 10/96
