SUPPLEMENT TO THE
DAILY TAX-EXEMPT MONEY FUND
PROSPECTUS
DATED DECEMBER 20, 1995
The following information replaces the fourth paragraph under the heading
"Other Expenses" in the "Breakdown of Expenses" section, on page P-9.
The fund has adopted a DISTRIBUTION AND SERVICE PLAN. The Plan recognizes
that FMR may use its resources, including management fees, to pay expenses
associated with the sale of shares of the fund. The Board of Trustees has
authorized FMR to pay FDC a distribution fee from its management fee
revenue, past profits or other resources, at an annual rate of up to 0.38%
of the fund's average net assets for payments made to investment
professionals based on average aggregate balances maintained, and, in
special circumstances, up to 0.40% of the fund's average net assets. This
additional 0.02% will be paid to investment professionals who maintain
assets in excess of $600 million in a single omnibus account.
For the fiscal year ended October 31, 1995, FMR paid FDC monthly at an
annual rate of 0.26% of the fund's average net assets throughout the month.
SUPPLEMENT TO DAILY TAX-EXEMPT MONEY FUND
STATEMENT OF ADDITIONAL INFORMATION
DECEMBER 20, 1995
The following information replaces the sixth paragraph in the "Distribution
and Service Plan" section, on page 16.
The Plan allows FDC to make payments to certain third parties with whom FDC
has entered into written Service Contracts and who assist or have assisted
in selling shares of the fund or who provide shareholder support services
(investment professionals), for assistance in selling shares of the fund or
for providing shareholder support services. The Plan authorizes FMR to make
payments from its management fee, its past profits or any other source
available to it, to reimburse FDC for these payments to investment
professionals, provided that such payments cannot exceed the amount of the
management fee. The maximum amount payable to investment professionals
under the Plan, as determined by the Board of Trustees, is currently at the
annual rate of up to 0.40% of the average net asset value of the fund for
shareholder support or distribution services.
