<PAGE>
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[logo] NVESTFUNDS(SM)
Where The Best Minds Meet(R)
Nvest
MONEY MARKET FUNDS
Back Bay Advisors, L.P.
[graphic omitted]
The Securities and Exchange Commission has not approved the Fund's shares or
determined whether this Prospectus is accurate or complete. Anyone who tells you
otherwise is committing a crime.
For general information on the Funds or any of their services and for
assistance in opening an account, contact your financial representative or
call Nvest Funds.
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TAXABLE MONEY MARKET FUND
Nvest Cash Management Trust --
Money Market Series
Back Bay Advisors, L.P.
TAX EXEMPT MONEY MARKET FUND
Nvest Tax Exempt
Money Market Trust
Back Bay Advisors, L.P.
PROSPECTUS
September 1, 1999
(as revised February 1, 2000)
WHAT'S INSIDE
[graphic omitted] GOALS, STRATEGIES & RISKS
PAGE 2
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[graphic omitted] FUND FEES & EXPENSES
PAGE 6
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[graphic omitted] MANAGEMENT TEAM
PAGE 8
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[graphic omitted] FUND SERVICES
PAGE 9
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[graphic omitted] FUND PERFORMANCE
PAGE 18
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Nvest Funds
399 Boylston Street, Boston, Massachusetts 02116
800-225-5478
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Table of Contents
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GOALS, STRATEGIES & RISKS
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Nvest Cash Management Trust - Money Market Series ........................... 2
Nvest Tax Exempt Money Market Trust ......................................... 4
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FUND FEES & EXPENSES
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Fund Fees & Expenses ........................................................ 6
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MORE ABOUT RISK
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More About Risk ............................................................. 7
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MANAGEMENT TEAM
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Meet the Funds' Investment Adviser and Subadviser ........................... 8
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FUND SERVICES
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Investing in the Funds ...................................................... 9
It's Easy to Open an Account ................................................ 9
Buying Shares .............................................................. 10
Selling Shares ............................................................. 11
Selling Shares in Writing .................................................. 12
Exchanging Shares .......................................................... 13
Restrictions on Buying, Selling and Exchanging Shares ...................... 14
How Fund Shares Are Priced ................................................. 15
Dividends and Distributions ................................................ 16
Tax Consequences ........................................................... 16
Additional Investor Services ............................................... 17
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FUND PERFORMANCE
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Nvest Cash Management Trust - Money Market Series .......................... 18
Nvest Tax Exempt Money Market Trust ........................................ 19
Glossary of Terms .......................................................... 20
If you have questions about any of the terms used in this Prospectus, please
refer to the "Glossary of Terms."
<PAGE>
FUND FOCUS
Stability Income Growth
------------------------
[graphic omitted] GOALS, STRATEGIES & RISKS High X
------------------------- --------- ------ -------
NVEST CASH MANAGEMENT Med.
TRUST -- MONEY MARKET SERIES --------- ------ -------
Low X X
TICKER SYMBOL: CLASS A CLASS B CLASS C
-------------------------
NEMXX NMBXX NVCXX
ADVISER: Nvest Funds Management, L.P. ("Nvest Management")
SUBADVISER: Back Bay Advisors, L.P. ("Back Bay Advisors")
INVESTMENT GOAL
The Fund seeks maximum current income consistent with preservation of capital
and liquidity.
INVESTMENT STRATEGIES
The Fund will invest up to 100% of its assets in high-quality, short-term,
dollar-denominated money market investments issued by U.S. and foreign issuers.
To preserve its investors' capital, the Fund seeks to maintain a stable $1.00
share price. Some of the Fund's portfolio positions include:
x Certificates of deposit
x Bankers' acceptances or bank notes
x Securities issued or guaranteed by the U.S. government
x Commercial paper
x Repurchase agreements
x Other corporate debt obligations
x Cash
Back Bay Advisors will manage the Fund's portfolio in compliance with
industry-standard requirements for money market funds. These requirements
include:
o CREDIT QUALITY -- The Fund's investments are generally rated in the two
highest rating categories as rated by a major credit agency.
o MATURITY -- Each of the Fund's investments has a maturity of 397 days or
less and the average portfolio maturity is 90 days or less.
o DIVERSIFICATION -- The Fund is diversified which limits its exposure to any
given issuer.
The Fund's portfolio manager may adjust the Fund's holdings or its average
maturity based on actual or anticipated changes in interest rates or credit
quality. The Fund is appropriate for investors who seek a conservative
investment for their portfolio or who are comfortable with the risks described
below and need cash immediately.
A "snapshot" of the Fund's investments may be found in the current annual or
semiannual report.
INVESTMENT RISKS
MONEY MARKET SECURITIES: Subject to credit risk and interest rate risk. Credit
risk relates to the ability of an issuer to make payments of principal and
interest when due and includes the risk of default. Although generally
considered unlikely, the risk of default could cause the Fund's share price
or yield to fall. Interest rate risk relates to changes in a security's
value as a result of changes in interest rates. Generally, the value of
money market securities rises when prevailing interest rates fall and falls
when interest rates rise.
Risks of foreign investments include a lack of issuer information, the risk
of political uncertainties as well as different regulatory requirements.
An investment in the Fund is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other government agency. Although the
Fund seeks to preserve the net asset value of your investment at $1.00 per
share, it is possible to lose money by investing in the Fund.
To learn more about the possible risks of investing in a Fund, please refer to
the section entitled "More About Risk." This section details the risks of
practices in which the Funds may engage. Please read this section carefully
before you invest.
<PAGE>
GOALS, STRATEGIES & RISKS [graphic omitted]
EVALUATING THE FUND'S PAST PERFORMANCE
The bar chart and table shown below give an indication of the risks of investing
in Nvest Cash Management Trust - Money Market Series. The Fund's past
performance does not necessarily indicate how the Fund will perform in the
future.
The bar chart shows the Fund's total returns for Class A shares for each of the
last ten calendar years.+
(TOTAL RETURN)
1989 8.5%
1990 8.3%
1991 7.2%
1992 4.6%
1993 2.8%
1994 2.7%
1995 4.8%
1996 5.0%
1997 4.8%
1998 5.0%
/\ Highest Quarterly Return: Second Quarter 1989, up 2.32%
\/ Lowest Quarterly Return: Third Quarter 1993 , up 0.61%
+ The Fund's Class A shares total return year-to-date as of June 30, 1999 was
4.6%.
The table below shows the Fund's average annual total returns for the one-year,
five-year and ten-year periods (or since the class's inception if shorter).
AVERAGE ANNUAL TOTAL RETURNS
(for the periods ended June 30, 1999) PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
Nvest Cash Management Trust -
Money Market Series:
Class A (Inception 7/10/78) 4.6% 4.8% 4.9%
Nvest Cash Management Trust -
Money Market Series:
Class B (Inception 9/13/93) 4.6% 4.8% 4.5%*
Nvest Cash Management Trust -
Money Market Series:
Class C (Inception 3/1/98) 4.6% 4.7%* 4.7%*
*Since Inception
For actual past expenses of Class A, B and C shares, see the section entitled
"Fund Fees and Expenses."
For current yield information about the Fund, shareholders or their financial
representatives may call Nvest Funds Personal Access Line(TM) 24 hours a day at
800-225-5478, press 1.
<PAGE>
FUND FOCUS
Stability Income Growth
------------------------
[graphic omitted] GOALS, STRATEGIES & RISKS High X
------------------------- --------- ------ -------
NVEST TAX EXEMPT Med.
MONEY MARKET TRUST --------- ------ -------
Low X X
TICKER SYMBOL: CLASS A CLASS B
----------------
NEEXX TEBXX
ADVISER: Nvest Funds Management, L.P. ("Nvest Management")
SUBADVISER: Back Bay Advisors, L.P. ("Back Bay Advisors")
INVESTMENT GOAL
The Fund seeks current income exempt from federal income taxes consistent with
the preservation of capital and liquidity.
INVESTMENT STRATEGIES
Under normal market conditions, the Fund will invest in high-quality, short-term
instruments that pay interest that is exempt from federal income tax ("Municipal
Securities"). Municipal Securities are generally issued by states and local
governments and their agencies. Unless it has adopted a temporary defensive
position, it is a fundamental policy of the Fund that it will invest at least
80% of its net assets in Municipal Securities. To preserve its investors'
capital, the Fund seeks to maintain a stable $1.00 share price. Some of the
Fund's portfolio positions include:
x Notes or bonds
x Commercial paper
x When-issued securities or securities purchased from a broker-dealer with the
right to sell them back at a certain time and price (a "put")
x Variable or floating interest rate obligations
x Taxable, high-quality money market securities including certificates of
deposit, bankers' acceptances or bank notes, and other corporate debt
obligations
x Repurchase Agreements
x Cash
Back Bay Advisors will manage the Fund's portfolio in compliance with
industry-standard requirements for money market funds. These requirements
include:
o CREDIT QUALITY -- The Fund's investments are generally rated in the two
highest rating categories as rated by a major credit agency.
o MATURITY -- Each of the Fund's investments has a maturity of 397 days or
less and the average portfolio maturity is 90 days or less.
o DIVERSIFICATION -- The Fund is diversified which limits its exposure to any
given issuer.
The Fund's portfolio manager may adjust the Fund's holdings or its average
maturity based on actual or anticipated changes in interest rates or credit
quality. The Fund is appropriate for investors who seek a conservative
investment exempt from federal taxes for their portfolio or who are comfortable
with the risks described below and need cash immediately.
A "snapshot" of the Fund's investments may be found in the current annual or
semiannual report.
INVESTMENT RISKS
MONEY MARKET SECURITIES: Subject to credit risk and interest rate risk.
Credit risk relates to the ability of an issuer to make payments of
principal and interest when due and includes the risk of default. Although
generally considered unlikely, the risk of default could cause the Fund's
share price or yield to fall. Interest rate risk relates to changes in a
security's value as a result of changes in interest rates. Generally, the
value of money market securities rises when prevailing interest rates fall
and falls when interest rates rise.
The Fund's price stability and liquidity may not be equal to that of a
taxable money market fund, because the market for Municipal Securities is
not as broad as the market for taxable money market securities and the
average portfolio maturity is generally greater for the Fund than for a
taxable money market fund.
An investment in the Fund is not insured or guaranteed by the Federal
Deposit Insurance Corporation or any other government agency. Although the
Fund seeks to preserve the value of your investment at $1.00 per share, it
is possible to lose money by investing in the Fund.
To learn more about the possible risks of investing in a Fund, please refer to
the section entitled "More About Risk." This section details the risks of
practices in which the Funds may engage. Please read this section carefully
before you invest.
<PAGE>
GOALS, STRATEGIES & RISKS [graphic omitted]
-------------------------
EVALUATING THE FUND'S PAST PERFORMANCE
The bar chart and table shown below give an indication of the risks of investing
in Nvest Tax Exempt Money Market Trust. The Fund's past performance does not
necessarily indicate how the Fund will perform in the future.
The bar chart shows the Fund's total returns for Class A shares for each of the
last ten calendar years.+
(TOTAL RETURN)
1989 5.5%
1990 5.6%
1991 4.9%
1992 3.4%
1993 2.2%
1994 2.1%
1995 3.2%
1996 3.3%
1997 3.2%
1998 3.3%
/\ Highest Quarterly Return: Second Quarter 1989, up 1.51%
\/ Lowest Quarterly Return: First Quarter 1993, up 0.48%
+ The Fund's Class A shares total return year-to-date as of June 30, 1999 was
2.8%.
The table below shows the Fund's average annual total returns for the one-year,
five-year and ten-year periods (or since the class's inception if shorter).
AVERAGE ANNUAL TOTAL RETURNS
(for the periods ended June 30, 1999) PAST 1 YEAR PAST 5 YEARS PAST 10 YEARS
Nvest Tax Exempt Money Market Trust -
Class A (Inception 4/21/83) 2.8% 3.2% 3.4%
Nvest Tax Exempt Money Market Trust -
Class B (Inception 9/13/93) 2.8% 3.2%* 3.0%*
*Since Inception
For actual past expenses of Class A and B shares, see the section entitled
"Fund Fees and Expenses."
For current yield information about the Fund, shareholders or their financial
representatives may call Nvest Funds Personal Access Line(TM) 24 hours a day at
800-225-5478, press 1.
<PAGE>
[graphic omitted] FUND FEES & EXPENSES
The following tables describe the fees and expenses that you may pay if you buy
and hold shares of each Fund.
Shareholder Fees
(fees paid directly from your investment)
<TABLE>
<CAPTION>
CASH MANAGEMENT TRUST -- TAX EXEMPT
MONEY MARKET SERIES MONEY MARKET TRUST
CLASS A CLASS B CLASS C CLASS A CLASS B
<S> <C> <C> <C> <C> <C>
Maximum sales charge (load) imposed on purchases None None None None None
Maximum deferred sales charge (load) None* None* None* None* None*
Redemption fees None** None** None** None** None**
* Shares of each class are sold without any sales charge. However, Class A, B and C shares may be subject t
a Contingent Deferred Sales Charge ("CDSC") if the shares were purchased by exchange from another Nvest Fund.
See the section entitled "Exchanging Shares."
** Generally, a transaction fee will be charged for expedited payment of redemption proceeds such as by wire or
overnight delivery.
</TABLE>
ANNUAL FUND OPERATING EXPENSES
(expenses that are deducted from Fund assets, as a percentage of average net
assets)
<TABLE>
<CAPTION>
CASH MANAGEMENT TRUST -- TAX EXEMPT
MONEY MARKET SERIES MONEY MARKET TRUST
CLASS A CLASS B CLASS C CLASS A CLASS B
<S> <C> <C> <C> <C> <C>
Management fees 0.42% 0.42% 0.42% 0.40% 0.40%
Distribution and/or service (12b-1) fees 0.00% 0.00% 0.00% 0.00% 0.00%
Other expenses 0.42% 0.42% 0.42% 0.40% 0.40%
Total annual fund operating expenses 0.84% 0.84% 0.84% 0.80% 0.80%
Fee Waiver 0.00% 0.00% 0.00% 0.15%* 0.15%*
Net Expenses 0.84% 0.84% 0.84% 0.65% 0.65%
* Nvest Management has given a binding undertaking to Nvest Tax Exempt Money Market Trust to limit the amount
of the Fund's total fund operating expenses to 0.65% of the Fund's total net assets for Class A and B shares.
This undertaking will be in effect for the life of this Prospectus.
</TABLE>
EXAMPLE
This example is intended to help you compare the cost of investing in each Fund
with the cost of investing in other mutual funds.
The example assumes that:
o You invest $10,000 in the Fund for the time periods indicated;
o Your investment has a 5% return each year; and
o The Fund's operating expenses remain the same.
Although your actual costs and returns may be higher or lower, based on these
assumptions your costs would be:
CASH MANAGEMENT TRUST -- TAX EXEMPT
MONEY MARKET SERIES MONEY MARKET TRUST
CLASS A CLASS B CLASS C CLASS A CLASS B
(1) (1)
1 year $ 86 $ 86 $ 86 $ 66 $ 66
3 years $ 268 $ 268 $ 268 $ 208 $ 208
5 years $ 466 $ 466 $ 466 $ 362 $ 362
10 years $1,037 $1,037 $1,037 $ 810 $ 810
(1) Assumes CDSC does not apply to the redemption. See the section entitled
"Exchanging Shares."
<PAGE>
MORE ABOUT RISK
The Funds have principal investment strategies that come with inherent risks.
The following is a list of risks to which each Fund may be subject by investing
in various types of securities or engaging in various practices
MARKET RISK (Both Funds) The risk that the market value of a security may move
up and down, sometimes rapidly and unpredictably, based upon change in an
issuer's financial condition as well as overall market and economic conditions.
MANAGEMENT RISK (Both Funds) The risk that a strategy used by a Fund's portfolio
management may fail to produce the intended result.
CREDIT RISK (Both Funds) The risk that the issuer of a security, or the
counterparty to a contract, will default or otherwise become unable to honor a
financial obligation.
INTEREST RATE RISK (Both Funds) The risk of market losses attributable to
changes in interest rates. With fixed-income securities, a rise in interest
rates typically causes a fall in a security's value.
FOREIGN RISK (Cash Management Trust - Money Market Series) A foreign security
may be affected by limited liquidity and higher volatility than securities held
by a U.S. bank. Political, economic and information risks as well as different
regulatory requirements are also associated with securities held by a foreign
bank.
INFORMATION RISK (Both Funds) The risk that key information about a security is
inaccurate or unavailable.
OPPORTUNITY RISK (Both Funds) The risk of missing out on an investment
opportunity because the assets necessary to take advantage of such opportunity
are tied up in less advantageous investments.
LIQUIDITY RISK (Both Funds) The risk that certain securities may be difficult or
impossible to sell at the time and at the price that the seller would like. This
may result in a loss or may be costly to a Fund.
VALUATION RISK (Both Funds) The risk that the Fund has valued certain securities
at a higher price than it can sell them for.
POLITICAL RISK (Both Funds) The risk of losses directly attributable to
government or political actions.
YEAR 2000 (Both Funds) Many computer systems today cannot distinguish between
the year 1900 and the year 2000. Nvest Funds does not currently anticipate that
computer problems related to the year 2000 will have a material effect on any
Fund. However, there can be no assurances in this area, including the
possibility that year 2000 computer problems could negatively affect
communication systems or investment markets, including investments by a Fund or
the economy in general.
<PAGE>
[graphic omitted] MANAGEMENT TEAM
---------------
MEET THE FUNDS' INVESTMENT ADVISER AND SUBADVISER
The Nvest Funds family includes 25 mutual funds with a total of over $8 billion
in assets under management as of December 31, 1999. Nvest Funds are distributed
through Nvest Funds Distributor, L.P. (the "Distributor"). This Prospectus
covers Nvest Cash Management Trust - Money Market Series and Nvest Tax Exempt
Money Market Trust (the "Money Market Funds" and each a "Fund"). Nvest Stock
Funds, Nvest Bond Funds, Nvest Star Funds, Kobrick Funds and Nvest State
Tax-Free Funds constitute the "Nvest Funds."
NVEST FUNDS MANAGEMENT, L.P.
Nvest Management, located at 399 Boylston Street, Boston, Massachusetts 02116,
serves as the adviser to each of the Funds. Nvest Management is a subsidiary of
Nvest Companies, L.P. ("Nvest Companies"), which is part of an affiliated group
including Nvest, L.P., a publicly traded company listed on the New York Stock
Exchange. Nvest Companies' 14 principal subsidiary or affiliated asset
management firms, collectively, had more than $127 billion in assets under
management as of September 30, 1999. Nvest Management oversees, evaluates and
monitors the subadvisory services provided to each Fund. It also provides
general business management and administration to the Funds. Back Bay Advisors
makes the investment decisions for each Fund.
The combined advisory and subadvisory fees paid by the Funds for the year ended
June 30, 1999, as a percentage of each Fund's average daily net assets, were
0.42% for the Cash Management Trust - Money Market Series and 0.40% for the Tax
Exempt Money Market Trust.
SUBADVISER
BACK BAY ADVISORS, located at 399 Boylston Street, Boston, Massachusetts 02116,
serves as the subadviser for each Fund. Back Bay Advisors is a subsidiary of
Nvest Companies. Back Bay Advisors, founded in 1986, provides discretionary
investment management services for approximately $9 billion of assets as of June
30, 1999 for mutual funds and other institutional investors.
SUBADVISORY AGREEMENTS
Each Fund has received an exemptive order from the Securities and Exchange
Commission (the "SEC") which permits Nvest Management to amend or continue
existing subadvisory agreements when approved by the Funds' Board of Trustees,
without shareholder approval. The exemption also permits Nvest Management to
enter into new subadvisory agreements with subadvisers that are not affiliated
with Nvest Management if approved by the Funds' Board of Trustees. Shareholders
will be notified of any subadviser changes.
PORTFOLIO TRADES
In placing portfolio trades, each Fund's adviser or subadviser may use brokerage
firms that market the Fund's shares or are affiliated with Nvest Companies,
Nvest Management or Back Bay Advisors. In placing trades, Back Bay Advisors will
seek to obtain the best combination of price and execution, which involves a
number of judgmental factors. Such portfolio trades are subject to applicable
regulatory restrictions and related procedures adopted by the Funds' Board of
Trustees.
<PAGE>
FUND SERVICES [graphic omitted]
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INVESTING IN THE FUNDS
CHOOSING A SHARE CLASS
Nvest Cash Management Trust - Money Market Series offers Class A, Class B and
Class C shares to the public and Nvest Tax Exempt Money Market Trust offers only
Class A and Class B shares. The classes of each Fund enable shareholders in the
same classes of another Nvest Fund to invest in the Money Market Funds through
an exchange of shares.
IT'S EASY TO OPEN AN ACCOUNT
TO OPEN AN ACCOUNT WITH NVEST FUNDS:
1. Read this Prospectus carefully.
2. Determine how much you wish to invest. The following chart shows the
investment minimums for various types of accounts:
<TABLE>
<CAPTION>
MINIMUM TO OPEN AN
MINIMUM TO ACCOUNT USING MINIMUM FOR
TYPE OF ACCOUNT OPEN AN ACCOUNT INVESTMENT BUILDER EXISTING ACCOUNTS
<S> <C> <C> <C>
Any account other than those listed below $2,500 $100 $100
Accounts registered under the Uniform
Gifts to Minors Act or the Uniform $2,000 $100 $100
Transfers to Minors Act
Individual Retirement Accounts (IRAs) $500 $100 $100
Retirement plans with tax benefits such
as corporate pension, profit sharing $250 $100 $100
and Keogh plans
Payroll Deduction Investment Programs
for 401(k), SARSEP, SEP, SIMPLE, $25 N/A $25
403(b)(7) and certain other
retirement plans
</TABLE>
3. Complete the appropriate parts of the account application, carefully
following the instructions. If you have any questions, please call your
financial representative or Nvest Funds at 800-225-5478. For more
information on Nvest Funds' investment programs, refer to the section
entitled "Additional Investor Services" in this Prospectus.
4. Use the following sections as your guide for purchasing shares.
SELF-SERVICING YOUR ACCOUNT
Buying or selling shares is easy with the services described below:
NVEST FUNDS PERSONAL ACCESS LINE(R) NVEST FUNDS WEB SITE
800-225-5478, press 1 www.nvestfunds.com
You have access to your account 24 hours a day by calling Personal Access
Line(R) from a touch-tone telephone or by visiting us online. Using these
customer service options, you may:
o purchase, exchange or redeem shares in your existing accounts (certain
restrictions may apply);
o view your account balances, recent transactions, Fund prices and recent
performance;
o order duplicate account statements; and
o obtain tax information.
Please see the following pages for other ways to buy, exchange or sell your
shares.
<PAGE>
[graphic omitted] Fund Services
-------------
BUYING SHARES
OPENING AN ACCOUNT ADDING TO AN ACCOUNT
THROUGH YOUR INVESTMENT DEALER
o Call your investment dealer for o Call your investment dealer for
information. information.
BY MAIL
[graphic omitted]
o Make out a check in U.S. dollars for o Make out a check in U.S. dollars for
the investment amount, payable to the investment amount, payable to
"Nvest Funds." Third party checks "Nvest Funds." Third party checks
will generally not be accepted. will generally not be accepted.
o Mail the check with your completed o Fill out the detachable investment
application to Nvest Funds, P.O. Box slip from an account statement. If
8551, Boston, MA 02266-8551. no slip is available, include with
the check a letter specifying the
Fund name, your class of shares,
your account number and the
registered account name(s). To make
investing even easier, you can order
more investment slips by calling
800-225-5478.
BY EXCHANGE
[graphic omitted]
o The exchange must be for a minimum o The exchange must be for a minimum
of $1,000 or for all of your shares. of $1,000 or for all of your shares.
o Obtain a current prospectus for the o Call your investment dealer or Nvest
Fund into which you are exchanging Funds at 800-225-5478 to request an
by calling your investment dealer or exchange.
Nvest Funds at 800-225-5478.
o See the section entitled "Exchanging
o Call your investment dealer or Nvest Shares" for more details.
Funds to request an exchange.
o See the section entitled "Exchanging
Shares" for more details.
BY WIRE
[graphic omitted]
o Call Nvest Funds at 800-225-5478 to o Instruct your bank to transfer funds
obtain an account number and wire to State Street Bank & Trust
transfer instructions. Your bank may Company, ABA# 011000028, DDA#
charge you for such a transfer. 99011538.
o Specify the Fund name, your class of
shares, your account number and the
registered account name(s). Your
bank may charge you for such a
transfer.
AUTOMATIC INVESTING THROUGH INVESTMENT BUILDER
[graphic omitted]
o Indicate on your application that o Please call Nvest Funds at
you would like to begin an automatic 800-225-5478 for a Service Options
investment plan through Investment Form. A signature guarantee may be
Builder and the amount of your required to add this privilege.
monthly investment ($100 minimum).
o See the section entitled "Additional
o Send a check marked "Void" or a Investor Services."
deposit slip from your bank account
along with your application.
THROUGH AUTOMATED CLEARING HOUSE (ACH)
[graphic omitted]
o Ask your bank or credit union o Call Nvest Funds at 800-225-5478 to
whether it is a member of the ACH add shares to your account through
system. ACH.
o Complete the "Telephone Withdrawal o If you have not signed up for the
and Exchange" and "Bank Information" ACH system, please call Nvest Funds
sections on your account for a Service Options Form. A
application. signature guarantee may be required
to add this privilege.
o Mail your completed application to
Nvest Funds, P.O. Box 8551, Boston,
MA 02266-8551.
<PAGE>
FUND SERVICES [graphic omitted]
-------------
SELLING SHARES
TO SELL SOME OR ALL OF YOUR SHARES
Certain restrictions may apply. See section entitled "Restrictions on Buying,
Selling and Exchanging Shares."
THROUGH YOUR INVESTMENT DEALER
o Call your investment dealer for information.
BY MAIL
[graphic omitted]
o Write a letter to request a redemption specifying the name of the Fund, the
class of shares, your account number, the exact registered account name(s),
the number of shares or the dollar amount to be redeemed and the method by
which you wish to receive your proceeds. Additional materials may be
required. See the section entitled "Selling Shares in Writing."
o The request must be signed by all of the owners of the shares including the
capacity in which they are signing, if appropriate.
o Mail your request to Nvest Funds, P.O. Box 8551, Boston, MA 02266-8551.
o Your proceeds (less any applicable CDSC) will be delivered by the method
chosen in your letter. If you choose to have your proceeds delivered by
mail, they will generally be mailed to you on the business day after the
request is received. You may also choose to redeem by wire or through ACH
(see below).
BY EXCHANGE
[graphic omitted]
o Obtain a current prospectus for the Fund into which you are exchanging by
calling your investment dealer or Nvest Funds at 800-225-5478.
o Call Nvest Funds to request an exchange.
o See the section entitled "Exchanging Shares" for more details.
BY WIRE
[graphic omitted]
o Fill out the "Telephone Withdrawal and Exchange" and "Bank Information"
sections on your account application.
o Call Nvest Funds at 800-225-5478 or indicate in your redemption request
letter (see above) that you wish to have your proceeds wired to your bank.
o Proceeds (less any applicable CDSC) will generally be wired on the next
business day. A wire fee (currently $5.00) will be deducted from the
proceeds.
THROUGH AUTOMATED CLEARING HOUSE (ACH)
[graphic omitted]
o Ask your bank or credit union whether it is a member of the ACH system.
o Complete the "Telephone Withdrawal and Exchange" and "Bank Information"
sections on your account application.
o If you have not signed up for the ACH system on your application, please
call Nvest Funds at 800-225-5478 for a Service Options Form.
o Call Nvest Funds to request a redemption through this system.
o Proceeds (less any applicable CDSC) will generally arrive at your bank
within three business days.
BY SYSTEMATIC WITHDRAWAL PLAN
[graphic omitted]
o Please refer to the section entitled "Additional Investor Services" or call
Nvest Funds at 800-225-5478 or your financial representative for
information.
o Because withdrawal payments may have tax consequences, you should consult
your tax adviser before establishing such a plan.
BY TELEPHONE
[graphic omitted]
o You may receive your proceeds by mail, by wire or through ACH (see above).
o Call Nvest Funds at 800-225-5478 to choose the method you wish to use to
redeem your shares.
BY CHECK (for Class A only)
[graphic omitted]
o Select the checkwriting option on your account application and complete the
attached signature card.
o To add this privilege to an existing account, call Nvest Funds at
800-225-5478 for a Service Options Form.
o Each check must be written for $250 or more.
o You may not close your account by withdrawal check. Please call your
financial representative or Nvest Funds to close an account.
<PAGE>
[graphic omitted] FUND SERVICES
-------------
SELLING SHARES IN WRITING
If you wish to redeem your shares in writing, all owners of the shares must sign
the redemption request in the exact names in which the shares are registered and
indicate any special capacity in which they are signing. In certain situations,
you will be required to make your request to sell shares in writing. In these
instances, a letter of instruction signed by the authorized owner is necessary.
In certain situations we also may require a signature guarantee or additional
documentation.
A signature guarantee protects you against fraudulent orders and is necessary
if:
o your address of record has been changed within the past 30 days;
o you are selling more than $100,000 worth of shares and you are requesting
the proceeds by check; or
o a proceeds check for any amount is mailed to an address other than the
address of record or not payable to the registered owner(s).
A notary public cannot provide a signature guarantee. A signature guarantee can
be obtained from one of the following sources:
o a financial representative or securities dealer;
o a federal savings bank, cooperative, or other type of bank;
o a savings and loan or other thrift institution;
o a credit union; or
o a securities exchange or clearing agency.
The following table shows some situations in which additional documentation may
be necessary. Please call your financial representative or Nvest Funds regarding
requirements for other account types.
SELLER (ACCOUNT TYPE) REQUIREMENTS FOR WRITTEN REQUESTS
INDIVIDUAL, JOINT, SOLE o The signatures on the letter must
PROPRIETORSHIP, UGMA/UTMA include all persons authorized to
(MINOR ACCOUNTS) sign, including title, if
applicable.
o Signature guarantee, if applicable
(see above).
CORPORATE OR ASSOCIATION ACCOUNTS o The signatures on the letter must
include all persons authorized to
sign, including title.
OWNERS OR TRUSTEES OF TRUST ACCOUNTS o The signature on the letter must
include all trustees authorized to
sign, including title.
o If the names of the trustees are not
registered on the account, please
provide a copy of the trust document
certified within the past 60 days.
o Signature guarantee, if applicable
(see above).
JOINT TENANCY WHOSE CO-TENANTS o The signatures on the letter must
ARE DECEASED include all surviving tenants of the
account.
o Copy of the death certificate.
o Signature guarantee if proceeds
check is issued to other than the
surviving tenants.
POWER OF ATTORNEY (POA) o The signatures on the letter must
include the attorney-in-fact,
indicating such title.
o A signature guarantee.
o Certified copy of the POA document
stating it is still in full force
and effect, specifying the exact
Fund and account number, and
certified within 30 days of receipt
of instructions.*
QUALIFIED RETIREMENT BENEFIT PLANS o The signature on the letter must
(EXCEPT NVEST FUNDS PROTOTYPE include all signatures of those
DOCUMENTS) authorized to sign, including title.
o Signature guarantee, if applicable
(see above).
EXECUTORS OF ESTATES, ADMINISTRATORS, o The signature on the letter must
GUARDIANS, CONSERVATORS include those authorized to sign,
including capacity.
o A signature guarantee.
o Certified copy of court document
where signer derives authority,
e.g.: Letters of Administration,
Conservatorship, Letters
Testamentary.*
INDIVIDUAL RETIREMENT ACCOUNTS (IRAS) o Additional documentation and
distribution forms are required.
* Certification may be made on court documents by the court, usually certified
by the clerk of the court. POA certification may be made by a commercial bank,
broker/member of a domestic stock exchange or a practicing attorney.
<PAGE>
FUND SERVICES [graphic omitted]
-------------
EXCHANGING SHARES
In general, you may exchange shares of your Fund for shares of the other Money
Market Fund or a Nvest Fund subject to certain restrictions shown below. An
exchange must be for a minimum of $1,000 (or the total net asset value of your
account, whichever is less), or $100 if made under the Automatic Exchange Plan
(see the section entitled "Additional Investor Services"). All exchanges are
subject to the eligibility requirements of the Fund into which you are
exchanging. The exchange privilege may be exercised only in those states where
shares of the Funds may be legally sold. Please refer to the Statement of
Additional Information (the "SAI") for more detailed information on exchanging
Fund shares.
EXCHANGE OPTIONS
CLASS A SHARES OF A MONEY MARKET FUND NOT PREVIOUSLY SUBJECT TO A SALES CHARGE
OR CDSC MAY EXCHANGE INTO:
o Class A, B or C shares of a Money Market Fund without paying a sales charge
or CDSC.
o Class A, B or C shares of a Nvest Fund plus the applicable sales charge or
CDSC.
CLASS A SHARES OF A MONEY MARKET FUND PREVIOUSLY SUBJECT TO A SALES CHARGE OR
CDSC MAY EXCHANGE INTO:
o Class A shares of the other Money Market Fund without a sales charge or
CDSC.
o Class A shares of a Nvest Fund without paying a sales charge or CDSC (unless
you exchanged into a Money Market Fund from shares of the Nvest Intermediate
Tax Free Fund of California that you held for less than 6 months, which
would subject you to pay the difference between the sales charge previously
paid on your California Fund shares and the sales charge currently imposed
on other Nvest Fund shares).
CLASS B SHARES OF A MONEY MARKET FUND MAY EXCHANGE INTO:
o Class B shares of the other Money Market Fund without paying a sales charge
or CDSC.
o Class B shares of a Nvest Fund subject to its CDSC schedule.
CLASS C SHARES OF CASH MANAGEMENT TRUST - MONEY MARKET SERIES MAY EXCHANGE INTO:
o Class C shares of a Nvest Fund subject to its CDSC schedule.
If you exchange shares of a Nvest Fund into shares of the Money Market Funds,
the holding period for purposes of determining the CDSC for Class A, B or C
shares and conversion from Class B into Class A shares stops until you exchange
back into shares of another Nvest Fund. If you choose to redeem those Money
Market Fund shares, a CDSC may therefore apply.
<PAGE>
[graphic omitted] FUND SERVICES
-------------
RESTRICTIONS ON BUYING, SELLING AND EXCHANGING SHARES
PURCHASE AND EXCHANGE RESTRICTIONS
Although the Funds do not anticipate doing so, they reserve the right to suspend
or change the terms of purchasing or exchanging shares. The Funds and the
Distributor reserve the right to refuse or limit any purchase or exchange order
by a particular purchaser (or group of related purchasers) if the transaction is
deemed harmful to the best interest of the Fund's other shareholders or would
disrupt the management of the Fund. The Funds and the Distributor reserve the
right to restrict purchases and exchanges for the accounts of "market timers" by
limiting the transaction to a maximum dollar amount. An account will be deemed
to be one of a market timer if: (i) more than two exchange purchases of a given
Fund are made for the account in a calendar quarter or (ii) the account makes
one or more exchange purchases of a given Fund in a calendar quarter in an
aggregate amount in excess of 1% of the Fund's total net assets.
SELLING RESTRICTIONS
The table below describes restrictions placed on selling shares of any Fund
described in this Prospectus:
RESTRICTION SITUATION
The Fund may suspend the right of o When the New York Stock Exchange is
redemption or postpone payment for closed (other than a
more than 7 days: weekend/holiday)
o During an emergency
o Any other period permitted by the
SEC
The Fund reserves the right to suspend o With a notice of a dispute between
account services or refuse transaction registered owners
requests:
o With suspicion/evidence of a
fraudulent act
The Fund may pay the redemption price o When it is detrimental for a Fund to
in whole or part by a distribution in make cash payments as determined in
kind of readily marketable securities the sole discretion of the adviser
in lieu of cash or may take up to 7 or subadviser
days to pay a redemption request in
order to raise capital:
The Fund may close your account and o When the Fund account falls below a
send you the proceeds. You will have set minimum (currently $1,000 as set
60 days after being notified of the by the Funds' Board of Trustees)
Fund's intention to close your account
to increase the account to the set
minimum. This does not apply to
certain qualified retirement plans,
automatic investment plans or accounts
that have fallen below the minimum
solely because of fluctuations in a
Fund's net asset value per share:
The Fund may withhold redemption o When redemptions are made within 10
proceeds until the check or funds have calendar days of purchase by check
cleared: or ACH of the shares being redeemed
Telephone redemptions are not accepted for tax-qualified retirement accounts.
If you hold certificates representing your shares, they must be sent with your
request for it to be honored.
The Funds recommend that certificates be sent by registered mail.
CERTIFICATES
Certificates will not be automatically issued for any class of shares. Upon
written request, you may receive certificates for Class A shares only.
<PAGE>
FUND SERVICES [graphic omitted]
-------------
HOW FUND SHARES ARE PRICED
"Net asset value" is the price of one share of a Fund without a sales charge,
and is calculated each business day using this formula:
NET TOTAL VALUE OF SECURITIES + CASH AND OTHER ASSETS - LIABILITIES
ASSET = ----------------------------------------------------------------------
VALUE NUMBER OF OUTSTANDING SHARES
Fund securities are generally valued at amortized cost on each day that the New
York Stock Exchange (the "Exchange") is open for trading. Amortized cost
approximates market value of the security at the time of purchase. By using
amortized cost valuation, the Funds seek to maintain a constant net asset value
of $1.00 per share despite minor shifts in the market value of their portfolio
securities.
The net asset value of Fund shares is determined according to this schedule:
o A share's net asset value is determined at the close of regular trading on
the Exchange on the days the Exchange is open for trading. This is normally
4:00 p.m. Eastern time.
o The price you pay for purchasing, redeeming or exchanging a share will be
based upon the net asset value next calculated after your order is received
"in good order" by State Street Bank and Trust Company, the Funds'
custodian.
o Requests received by the Distributor after the Exchange closes will be
processed based upon the net asset value determined at the close of regular
trading on the next day that the Exchange is open, with the exception that
those orders received by your investment dealer before the close of the
Exchange and received by the Distributor before 5:00 p.m. Eastern time* on
the same day will be based on the net asset value determined on that day.
* Under limited circumstances, the Distributor may enter into a contractual
agreement where it may accept orders after 5:00 p.m., but not later than
8:00 p.m.
Generally, during times of substantial economic or market change it may be
difficult to place your order by phone. During these times, you may deliver your
order in person to the Distributor or send your order by mail as described in
"Buying Shares" and "Selling Shares."
<PAGE>
[graphic omitted] FUND SERVICES
-------------
DIVIDENDS AND DISTRIBUTIONS
The Funds generally distribute most or all of their net investment income (other
than long-term capital gains) in the form of dividends. Each Fund declares
dividends daily and pays them monthly. Each Fund distributes all net realized
long- and short-term capital gains annually, after applying any available
capital loss carryovers. If all of your shares of a Fund are redeemed at any
time during a month, all dividends accrued to date will be paid together with
the redemption proceeds. Each Fund's Board of Trustees may adopt a different
schedule as long as payments are made at least annually.
Depending on your investment goals and priorities, you may choose to:
o participate in the Dividend Diversification Program, which allows you to
have all dividends and distributions automatically invested at net asset
value (plus an applicable sales charge or CDSC) in shares of the same class
of a Money Market Fund or Nvest Fund registered in your name. Class A
shareholders may also have dividends and distributions automatically
invested in Class C shares of a Nvest Fund. Certain investment minimums and
restrictions may apply. For more information about this program, see the
section entitled "Additional Investor Services."
o receive distributions from dividends and interest in cash while reinvesting
distributions from capital gains in additional shares of the same class of a
Money Market Fund or in the same class of a Nvest Fund.
o receive all distributions in cash.
Unless you select one of the above options, distributions will automatically be
reinvested in shares of the same class of the Fund at net asset value. For more
information or to change your distribution option, contact Nvest Funds in
writing or call 800-225-5478.
If you earn more than $10 annually in taxable income from a non-retirement plan
Fund, you will receive a Form 1099 to help you report the prior calendar year's
distributions on your federal income tax return. Be sure to keep the 1099 as a
permanent record. A fee may be charged for any duplicate information requested.
TAX CONSEQUENCES
Each Fund intends to meet all requirements of the Internal Revenue Code
necessary to qualify as a "regulated investment company" and thus does not
expect to pay any federal income tax on income and capital gains distributed to
shareholders.
Fund distributions paid to you either in cash or reinvested in
additional shares are generally taxable to you as ordinary income (except for
exempt-interest dividends earned by Tax Exempt Money Market Trust - see below)
or as capital gains. Distributions derived from short-term capital gains or
investment income are generally taxable at ordinary income rates. The Funds
usually do not realize a substantial amount of long-term capital gains.
Distributions of gains from investments that a Fund owned for more than one year
that are designated by a Fund as capital gain dividends will generally be
taxable to a shareholder receiving such distributions as long-term capital gains
regardless of how long the shareholder has held Fund shares. Distributions are
taxable to you even if they are paid from income or gains earned by the Fund
before your investment (and thus were included in the price you paid).
An exchange of shares for shares of another Fund is treated as a sale, and any
resulting gain or loss may be subject to federal income tax. If you purchase
shares of a Fund shortly before it declares a capital gain distribution or a
dividend, a portion of the purchase price may be returned to you as a taxable
distribution.
Dividends derived from interest on U.S. government securities for the Nvest Cash
Management Trust - Money Market Series may be exempt from state and local income
taxes. The Fund intends to advise shareholders of the proportion of its
dividends that are derived from such interest. You should consult your tax
adviser about any federal, state and local taxes that may apply to the
distributions you receive.
SPECIAL TAX CONSIDERATIONS FOR TAX EXEMPT MONEY MARKET TRUST
Dividends paid to you as a shareholder of the Tax Exempt Money Market Trust that
are derived from interest on Municipal Securities are "exempt-interest
dividends" and may be excluded from gross income on your federal tax return.
However, if you receive Social Security benefits, you may be taxed on a portion
of those benefits as a result of receiving tax-exempt income. Also, if the Fund
invests in "private activity" municipal securities, a portion of the Fund's
dividends may constitute a tax preference item subject to the alternative
minimum tax.
The federal exemption for "exempt-interest dividends" does not necessarily
result in exemption from state and local taxes. Distributions of these dividends
may be exempt from local and state taxation to the extent they are derived from
the state and locality in which you reside. You should check the consequences
under your local and state tax laws before investing in the Fund. The Fund will
report annually on a state-by-state basis the source of income the Fund receives
on tax-exempt bonds that was paid out as dividends during the preceding year.
<PAGE>
FUND SERVICES [graphic omitted]
-------------
ADDITIONAL INVESTOR SERVICES
RETIREMENT PLANS
Nvest Funds offers a range of retirement plans, including IRAs, SEPs, SARSEPs,
SIMPLEs, 401(k) plans, 403(b) plans and other pension and profit sharing plans.
Refer to the section entitled "It's Easy to Open an Account" for investment
minimums. For more information about our Retirement Plans, call us at
800-225-5478.
INVESTMENT BUILDER PROGRAM
This is Nvest Funds' automatic investment plan. You may authorize automatic
monthly transfers of $100 or more from your bank checking or savings account to
purchase shares of one or more Nvest Funds. To join the Investment Builder
Program, please refer to the section entitled "Buying Shares."
DIVIDEND DIVERSIFICATION PROGRAM
This program allows you to have all dividends and any other distributions
automatically invested in shares of the same class of a Nvest Fund or Money
Market Fund, subject to the eligibility requirements of that other Fund and to
state securities law requirements. Shares will be purchased at the selected
Fund's net asset value (plus the applicable sales charge or CDSC) on the
dividend record date. Before establishing a Dividend Diversification Program
into a Nvest Fund or Money Market Fund, please read its prospectus carefully.
AUTOMATIC EXCHANGE PLAN
Nvest Funds has an automatic exchange plan under which shares of a class of a
Fund are automatically exchanged each month for shares of the same class of
other Nvest Funds or Money Market Fund. There is no fee for exchanges made under
this plan, but there may be a sales charge in certain circumstances. Please
refer to the SAI for more information on the Automatic Exchange Plan.
SYSTEMATIC WITHDRAWAL PLAN
This plan allows you to redeem shares and receive payments from your Fund on a
regular schedule. Redemption of shares that are part of the Systematic
Withdrawal Plan are not subject to a CDSC. However, the amount or percentage you
specify in the plan may not exceed, on an annualized basis, 10% of the value of
your Fund account based upon the value of your Fund account on the day you
establish your plan. To establish a Systematic Withdrawal Plan, please refer to
the section entitled "Selling Shares."
NVEST FUNDS PERSONAL ACCESS LINE(R)
This automated customer service system allows you to have access to your account
24 hours a day by calling 800-225-5478, press 1. With a touch-tone telephone,
you can obtain information about current yields, your current account balances,
recent transactions, Fund prices and recent performance. You may also use
Personal Access line(R) to purchase, exchange or redeem shares in any of your
existing accounts. Certain restrictions may apply.
NVEST FUNDS WEB SITE
Visit us at www.nvestfunds.com to review your account balance and recent
transactions, to view daily prices and performance information or to order
duplicate account statements and tax information. You may also go online to
purchase, exchange or redeem shares in your existing accounts. Certain
restrictions may apply.
<PAGE>
[graphic omitted] FUND PERFORMANCE
The financial highlights tables are intended to help you understand each Fund's
financial performance for the past 5 years. Certain information reflects
financial results for a single Fund share. The total returns in the table
represent the return that an investor would have earned (or lost) on an
investment in the Fund (assuming reinvestment of all dividends and
distributions). This information has been audited by PricewaterhouseCoopers LLP,
independent accountants, whose report, along with each Fund's financial
statements, are included in the Statement of Additional Information, which is
available upon request.
NVEST CASH MANAGEMENT TRUST -- MONEY MARKET SERIES
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS A, B, C
0 YEAR ENDED JUNE 30,
1995 1996 1997 1998(b) 1999
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of the Year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income 0.0469 0.0482 0.0467 0.0488 0.0445
Net Realized and Unrealized Gain on Investments 0.0000 0.0002 0.0000 0.0000 0.0000
---------- ---------- ---------- ---------- ----------
Total From Investment Operations 0.0469 0.0484 0.0467 0.0488 0.0445
---------- ---------- ---------- ---------- ----------
LESS DISTRIBUTIONS
Dividends From Net Investment Income (0.0469) (0.0484)(a) (0.0465) (0.0488)(a) (0.0445)
Dividends From Net Realized Capital Gains 0.0000 0.0000 (0.0002) 0.0000 (0.0000)
---------- ---------- ---------- ---------- ----------
Total Distributions (0.0469) (0.0484) (0.0467) (0.0488) (0.0445)
---------- ---------- ---------- ---------- ----------
Net Asset Value, End of the Year $1.0000 $ 1.0000 $ 1.0000 $ 1.0000 1.0000
========== ========== ========== ========== ==========
TOTAL RETURN (%) 4.8 5.0 4.8 5.0 4.6
RATIOS/SUPPLEMENTAL DATA
Ratio of Operating Expenses to Average Net Assets(%) 0.88 0.90 0.88 0.84 0.84
Ratio of Net Investment Income to Average Net Assets(%) 4.67 4.85 4.66 4.88 4.46
Net Assets, End of Year (000,000) $ 650 $ 664 $ 699 $ 607 $ 665
(a) Including net realized gain on investments.
(b) Class C shares commenced operations March 1, 1998.
</TABLE>
<PAGE>
Fund Performance [graphic omitted]
Nvest Tax Exempt Money Market Trust
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
CLASS A AND B
YEAR ENDED JUNE 30,
1995 1996 1997 1998 1999
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of the Year $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
---------- ---------- ---------- ---------- ----------
INCOME FROM INVESTMENT OPERATIONS
Net Investment Income 0.0314 0.0327 0.0314 0.0323 0.0276
Net Realized and Unrealized Gain on Investments 0.0000 0.0000 0.0001 0.0000 0.0000
---------- ---------- ---------- ---------- ----------
Total From Investment Operations 0.0314 0.0327 0.0315 0.0323 0.0276
---------- ---------- ---------- ---------- ----------
LESS DISTRIBUTIONS
Dividends From Net Investment Income (0.0314) (0.0327) (0.0315)(a) (0.0323)
(0.0276)
---------- ---------- ---------- ---------- ----------
Total Distributions (0.0314) (0.0327) (0.0315) (0.0323) (0.0276)
---------- ---------- ---------- ---------- ----------
Net Asset Value, End of the Year $ 1.0000 $ 1.0000 $ 1.0000 $ 1.0000 1.000
========== ========== ========== ========== ==========
TOTAL RETURN(%) 3.2 3.3 3.2 3.3 2.8
RATIOS/SUPPLEMENTAL DATA
Ratio of Operating Expenses to Average Net Assets(%)(b) 0.56 0.56 0.56 0.60 0.65
Ratio of Net Investment Income to Average Net Assets(%) 3.15 3.29 3.17 3.23 2.76
Net Assets, End of Year(000,000) $ 68 $ 65 $ 68 $ 74 $ 85
(a) Including net realized gain on investments.
(b) The ratio of operating expenses to average net assets without giving effect to the voluntary expense limitation and voluntary
fee waiver described in Note 3 to the financial statements contained in the SAI would have been 0.85% for 1995, 0.90% for
1996, 0.85% for 1997, 0.85% for 1998 and 0.80% for 1999.
</TABLE>
<PAGE>
GLOSSARY OF TERMS
BANKERS' ACCEPTANCE -- A bill of exchange drawn on and accepted by a bank. The
bank as the drawee of the bill becomes responsible for payment of the bill at
maturity.
BID PRICE -- The price a prospective buyer is ready to pay. This term is used by
traders who maintain firm bid and offer prices in a given security by standing
ready to buy or sell security units at publicly quoted prices.
CAPITAL GAIN DISTRIBUTIONS -- Payments to a Fund's shareholders of profits
earned from selling securities in a Fund's portfolio. Capital gain distributions
are usually paid once a year.
CREDIT RATING -- Independent evaluation of a bond's creditworthiness. This
measurement is usually calculated through an index compiled by companies such as
Standard & Poor's Group or Moody's Investors Service, Inc. Bonds with a credit
rating of BBB or higher by S&P or Baa or higher by Moody's are generally
considered investment grade.
DISCOUNTED PRICE -- The difference between a bond's current market price and its
face or redemption value.
DIVERSIFICATION -- The strategy of investing in a wide range of securities
representing different market sectors to reduce the risk if an individual
company or one sector suffers losses.
DIVIDEND YIELD -- The current or estimated annual dividend divided by the market
price per share of a security.
DURATION -- An estimate of how much a bond's price fluctuates with changes in
comparable interest rates.
INCOME DISTRIBUTIONS -- Payments to shareholders resulting from the net interest
or dividend income earned by a Fund's portfolio.
INFLATION -- A general increase in prices coinciding with a fall in the real
value of money, as measured by the Consumer Price Index.
INTEREST RATE -- Rate of interest charged for the use of money, usually
expressed at an annual rate.
MATURITY -- The final date on which the payment of a debt instrument (e.g.
bonds, notes, repurchase agreements) becomes due and payable. Short-term bonds
generally have maturities of up to 5 years; intermediate-term bonds between 5
and 15 years; and long-term bonds over 15 years.
NET ASSET VALUE (NAV) -- The market value of one share of a mutual fund on any
given day without sales charge or CDSC. It is determined by dividing a fund's
total net assets by the number of shares outstanding.
REPURCHASE AGREEMENT -- An agreement to buy a security at one price and a
simultaneous agreement to sell it back at an agreed upon price.
TOTAL RETURN -- The change in value of a mutual fund investment over a specific
time period expressed as a percentage. Total returns assume all earnings are
reinvested in additional shares of a Fund.
VARIABLE OR FLOATING-RATE DEBT SECURITIES -- Securities which pay a rate of
interest that is adjusted on a periodic basis and determined by reference to a
prescribed formula.
VOLATILITY -- The general variability of a portfolio's value resulting from
price fluctuations of its investments. In most cases, the more diversified a
portfolio is, the less volatile it will be.
YIELD -- The rate at which a Fund earns income, expressed as a percentage.
Mutual fund yield calculations are standardized, based upon a formula developed
by the SEC.
YIELD-TO-MATURITY -- The concept used to determine the rate of return an
investor will receive if a long-term, interest-bearing investment, such as a
bond, is held to its maturity date. It takes into account purchase price,
redemption value, time to maturity, coupon yield (the interest rate on a debt
security the issuer promises to pay to the holder until maturity, expressed as
an annual percentage of face value) and the time between interest payments.
<PAGE>
NOTES --
<PAGE>
[graphic omitted]
IF YOU WOULD LIKE MORE INFORMATION ABOUT THE FUNDS, THE
FOLLOWING DOCUMENTS ARE AVAILABLE FREE UPON REQUEST:
ANNUAL AND SEMIANNUAL REPORTS -- Provide additional
information about the Fund's investments. Each
report includes a discussion of the market conditions
and investment strategies that significantly affected the
Fund's performance during its last fiscal year.
STATEMENT OF ADDITIONAL INFORMATION (SAI) -- Provides
more detailed information about the Fund, has been
filed with the Securities and Exchange Commission
and is incorporated into this Prospectus by reference.
TO ORDER A FREE COPY OF THE FUND'S ANNUAL OR
SEMIANNUAL REPORT OR ITS SAI, CONTACT YOUR FINANCIAL
REPRESENTATIVE, OR THE FUNDS AT:
Nvest Funds Distributor, L.P.
399 Boylston Street
Boston, Massachusetts 02116
Telephone: 800-225-5478
Internet: www.nvestfunds.com
Your financial representative or Nvest Funds
will also be happy to answer your questions or to provide any
additional information that you may require.
You can review the Fund's reports and SAI at the
Public Reference Room of the Securities and
Exchange Commission. Text-only copies are
available free from the Commission's Web site
at: www.sec.gov.
Copies of these publications are also available for a fee by
writing or calling the Public Reference Room of the SEC,
Washington, D.C. 20549-6009
Telephone: 800-SEC-0330
Nvest Funds Distributor, L.P., and other firms selling
shares of Nvest Funds are members of the
National Association of Securities Dealers, Inc. (NASD). As
a service to investors, the NASD has asked that
we inform you of the availability of a brochure on its
Public Disclosure Program. The program provides
access to information about securities firms and their
representatives. Investors may obtain a copy by contacting the
NASD at 800-289-9999 or by visiting their Web site
at www.NASDR.com.
NVEST FUNDS MONEY MARKET FUNDS
Nvest Cash Management Trust -
Money Market Series
Nvest Tax Exempt Money Market Trust
(Investment Company Act File No. 811-4323)
(Investment Company Act File No. 811-242)
- --------------------------------------------------------------------------------
XM51-0200
