BENHAM TARGET MATURITIES TRUST, 485BPOS, 1996-09-03

BENHAM TARGET MATURITIES TRUST
485BPOS, 1996-09-03

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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X
-----

File No. 2-94608:

Pre-Effective Amendment No.____

Post-Effective Amendment No._25_ X
-----
and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 X
-----

File No. 811-4165:

Amendment No._27_

BENHAM TARGET MATURITIES TRUST
(Exact Name of Registrant as Specified in Charter)

4500 Main Street, Kansas City, MO 64141-6200
(Address of Principal Executive Offices)

Registrant's Telephone Number, including Area Code: 415-965-8300

Douglas A. Paul
General Counsel
1665 Charleston Road, Mountain View, CA 94043
(Name and Address of Agent for Service)

Approximate Date of Proposed Public Offering: Immediately, upon effectiveness
(first offered 3/25/85)

It is proposed that this filing become effective:

__X__ immediately upon filing pursuant to paragraph (b) of Rule 485
_____ on September 3, 1996, pursuant to paragraph (b) of Rule 485
_____ 60 days after filing pursuant to paragraph (a) of Rule 485
_____ on (date) pursuant to paragraph (a)(1) of Rule 485
_____ 75 days after filing pursuant to paragraph (a) (2) of Rule 485
_____ on (date) pursuant to paragraph (a)(2) of Rule 485

- --------------------------------------------------------------------------------
Registrant has elected to register an indefinite number of shares of beneficial
interest under the Securities Act of 1933 pursuant to Rule 24f-2 under the
Investment Company Act of 1940. On November 14, 1995, the Registrant filed a
Rule 24f-2 Notice on Form 24f-2 with respect to its fiscal year ended September
30, 1995.

<PAGE>
BENHAM TARGET MATURITIES TRUST
1933 Act Post-Effective Amendment No. 25
1940 Act Amendment No. 27

FORM N-1A
CROSS-REFERENCE SHEET

PART A: PROSPECTUS

ITEM PROSPECTUS CAPTION

1 Cover Page

2 Transaction and Operating Expense Table

3 Financial Highlights, Performance

4 Investment Management, Further Information About the Funds, Investment
Objectives of the Funds, Information About Investment Policies of the
Funds, Risk Factors and Investment Techniques, Other Investment
Practices

5 Investment Management

5A Not Applicable

6 Further Information About the Funds, How to Redeem Shares, Cover Page,
Distributions, Taxes

7 Cover Page, Distribution of Fund Shares, How to Open an Account, Share
Price, Transfer and Administrative Services

8 How to Redeem Shares, Transfer and Administrative Services

9 Not Applicable

PART B: STATEMENT OF ADDITIONAL INFORMATION

ITEM STATEMENT OF ADDITIONAL INFORMATION CAPTION

10 Cover Page

11 Table of Contents

12 Not Applicable

13 Investment Policies and Techniques, Investment Restrictions, Portfolio
Transactions

14 Trustee and Officers

15 Additional Purchase and Redemption Information, Trustees and Officers

16 Investment Advisory Services, Administrative and Transfer Agent
Services, Expense Limitation Agreement, About the Trust

17 Portfolio Transactions

18 About the Trust

19 Additional Purchase and Redemption Information, Valuation of Portfolio
Securities

20 Taxes

21 Additional Purchase and Redemption Information

22 Performance

23 Cover Page
<PAGE>
BENHAM
Target Maturities Trust

Prospectus

SEPTEMBER 3,
1996

BENHAM TARGET MATURITIES TRUST
- --------------------------------------------------------------------------------

The 2000 PORTFOLIO, 2005 PORTFOLIO, 2010 PORTFOLIO, 2015 PORTFOLIO, 2020
PORTFOLIO and 2025 PORTFOLIO, (the "Funds") are series of the Benham Target
Maturities Trust, a member of the Twentieth Century family of funds, a family
that includes 66 no-load mutual funds covering a variety of investment
opportunities. Six of the funds are described in this Prospectus. The other
funds are described in separate prospectuses.

INVESTMENT OBJECTIVES OF
THE FUNDS

Each Fund seeks to provide the highest attainable investment return
consistent with the creditworthiness of U.S. Treasury securities and the
professional management of reinvestment and market risks.

Each Fund invests primarily in zero-coupon U.S. Treasury securities and
will be liquidated shortly after the conclusion of its target maturity year. For
more information about this unique feature, please see "Distributions--Fund
Liquidation" on page 22.

MINIMUM INITIAL INVESTMENT: $2,500.

NO-LOAD MUTUAL FUNDS

Twentieth Century offers retail investors a full line of no-load funds,
investments that have no sales charges or commissions. The Funds offered by this
Prospectus have no 12b-1 plan or other deferred sales charges. The minimum
investment requirement for each of the above Funds is $2,500.

INVESTMENTS IN THE FUNDS ARE NOT INSURED OR GUARANTEED BY THE U.S.
GOVERNMENT OR ANY OTHER AGENCY.

This Prospectus gives you information about the Funds that you should know
before investing. Please read this Prospectus carefully and retain it for future
reference. Additional information is included in the Statement of Additional
Information dated September 3, 1996 and filed with the Securities and Exchange
Commission ("SEC"). It is incorporated in this Prospectus by reference. To
obtain a copy without charge, call or write:

Twentieth Century Mutual Funds
4500 Main Street o P.O. Box 419200
Kansas City, MO 64141-6200 o 1-800-345-2021
International calls: 816-531-5575
Telecommunications Device for the Deaf:
1-800-634-4113 o In Missouri: 816-753-1865
Internet: http://www.twentieth-century.com

There is no assurance that the Funds will achieve their investment objectives.
- --------------------------------------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

<PAGE>

TABLE OF CONTENTS
- --------------------------------------------------------------------------------

Transaction and Operating Expense Table ............3
Financial Highlights................................4

INFORMATION REGARDING THE FUNDS

INVESTMENT POLICIES OF THE FUNDS...................10
Investment Objectives of the Funds..............10
Investment Policies.............................10
Zero Coupon Securities..........................11
Other Investments...............................11
OTHER INVESTMENT PRACTICES,
THEIR CHARACTERISTICS AND RISKS.................11
Coupon-Bearing U.S. Treasury Securities.........12
REFCORP Bonds...................................12
Cash Management.................................12
Securities Lending..............................12
Portfolio Turnover..............................12
U.S. GOVERNMENT SECURITIES.........................13
PERFORMANCE ADVERTISING............................13

HOW TO INVEST WITH TWENTIETH CENTURY AND THE BENHAM GROUP

HOW TO OPEN AN ACCOUNT.............................15
By Mail.........................................15
By Wire.........................................15
By Exchange.....................................15
In Person.......................................16
SUBSEQUENT INVESTMENTS.............................16
By Mail.........................................16
By Telephone....................................16
By Wire.........................................16
In Person.......................................16
AUTOMATIC INVESTMENT PLAN..........................16
HOW TO EXCHANGE FROM ONE ACCOUNT
TO ANOTHER......................................16
By Mail.........................................17
By Telephone....................................17
HOW TO REDEEM SHARES...............................17
By Mail.........................................17
By Telephone....................................17
By Check-A-Month................................17
Other Automatic Redemptions.....................17
REDEMPTION PROCEEDS................................17
By Check........................................17
By Wire and ACH.................................17
REDEMPTION OF SHARES IN
LOW-BALANCE ACCOUNTS............................18
SIGNATURE GUARANTEE................................18
SPECIAL INVESTOR SERVICES..........................18
Automated Information Line......................18
Open Order Service..............................18
Tax-Qualified Retirement Plans..................19
IMPORTANT POLICIES REGARDING
YOUR INVESTMENTS................................19
REPORTS TO SHAREHOLDERS............................20
EMPLOYER-SPONSORED RETIREMENT PLANS AND
INSTITUTIONAL ACCOUNTS..........................20

ADDITIONAL INFORMATION YOU SHOULD KNOW

SHARE PRICE........................................21
When Share Price is Determined..................21
How Share Price is Determined...................21
Where to Find Information
About Share Price.............................22
DISTRIBUTIONS......................................22
Buying a Dividend...............................22
Reverse Share Splits............................22
Fund Liquidation................................22
TAXES..............................................23
Tax-Deferred Accounts...........................23
Taxable Accounts................................23
MANAGEMENT.........................................24
Investment Management...........................24
Code of Ethics..................................25
Transfer and Administrative Services............25
Distribution of Fund Shares.....................26
Expenses........................................26
FURTHER INFORMATION ABOUT THE FUNDS................26

- --------------------------------------------------------------------------------
NO PERSON IS AUTHORIZED BY THE FUNDS TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATION OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS OR IN OTHER PRINTED
OR WRITTEN MATERIAL ISSUED BY OR FOR THE FUNDS, AND YOU SHOULD NOT RELY ON ANY
OTHER INFORMATION OR REPRESENTATION.

TRANSACTION AND OPERATING EXPENSE TABLE
- --------------------------------------------------------------------------------------------------------

2000 2005 2010 2015 2020 2025
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
SHAREHOLDER
TRANSACTION EXPENSES:
<S> <C> <C> <C> <C> <C> <C>
Maximum Sales Load Imposed
on Purchases none none none none none none
Maximum Sales Load Imposed on
Reinvested Dividends none none none none none none
Deferred Sales Load none none none none none none
Redemption Fee(1) none none none none none none
Exchange Fee none none none none none none

ANNUAL FUND
OPERATING EXPENSES:(2)
(as a percentage of net assets)
Management Fees .30% .26% .21% .24% .26% .00%
12b-1 Fees none none none none none none
Other Expenses .31% .36% .41% .38% .36% .62%
Total Fund Operating Expenses .61% .62% .62% .62% .62% .62%

Example: You would pay the following expenses on a $1,000 investment, assuming
a 5% annual return and redemption at the end of each time period:

1 year $ 6 $ 6 $ 6 $ 6 $ 6 $ 6
3 years 20 20 20 20 20 20
5 years 34 35 35 35 35 35
10 years 76 77 77 77 77 77
</TABLE>

(1) Redemption proceeds sent by wire are subject to a $10 processing fee.
(2) Benham Management Corporation (the "Manager") has agreed to limit each
Fund's total operating expenses to specified percentages of each Fund's
average daily net assets. The agreement provides that the Manager may
recover amounts absorbed on behalf of the Fund during the preceding 11
months if, and to the extent that, for any given month, Fund expenses were
less than the expense limit in effect at that time. The current expense
limits for each of the Funds is .62%. These expense limits are subject to
annual renewal in June. Amounts which are paid by unaffiliated third parties
do not apply to these expense limits. If the expense limits were not in
effect, each Fund's Management Fee, Other Expenses and Total Fund Operating
Expenses would be as follows, respectively: 2005 Portfolio, .30%, .36% and
.66%; 2010 Portfolio, .30%, .41% and .71%; 2015 Portfolio, .30%, .38% and
.68%; 2020 Portfolio, .30%, .36% and .66%; and 2025 Portfolio, .30%, .66%
and .96%.

Each Fund pays the Manager management fees equal to an annualized percentage
of each Fund's average daily net assets. Other expenses include administrative
and transfer agent fees paid to Twentieth Century Services, Inc.

The purpose of the above table is to help you understand the various costs
and expenses that you, as a shareholder, will bear directly or indirectly in
connection with an investment in the shares of the Funds. The example set forth
above assumes reinvestment of all dividends and distributions and uses a 5%
annual rate of return as required by SEC regulations.

NEITHER THE 5% RATE OF RETURN NOR THE EXPENSES SHOWN ABOVE SHOULD BE
CONSIDERED INDICATIONS OF PAST OR FUTURE RETURNS AND EXPENSES. ACTUAL RETURNS
AND EXPENSES MAY BE GREATER OR LESS THAN THOSE SHOWN.

<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS

2000 PORTFOLIO

The Financial Highlights for each of the periods presented have been
audited by KPMG Peat Marwick LLP, independent auditors (except as noted). Their
reports appear in the Funds' annual reports to shareholders which are
incorporated by reference into the Statement of Additional Information. The
semiannual and the annual reports contain additional performance information and
will be made available upon request and without charge.

For a Share Outstanding Throughout the Six Months Ended March 31 (unaudited) and Years Ended September 30 (except as noted)

Mar. 31
1996 Sept. 30, Sept. 30, Sept. 30, Sept. 30, Sept. 30, Sept. 30, Sept. 30, Dec. 31, Dec. 31,
(unaudited) 1995 1994 1993 1992 1991 1990 1989+ 1988 1987
- ------------------------------------------------------------------------------------------------------------------------------------

PER-SHARE DATA++
- --------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value at
Beginning of Period...... $76.86 66.93 72.40 62.16 52.67 43.11 42.79 37.16 33.33 35.44
Income (Losses) From
Investment Operations
Net Investment Income.. 2.30 4.37 3.99 3.94 3.90 3.69 3.40 2.36 2.94 2.68
Net Realized and Unrealized
Gains (Losses) on
Investments.......... (.44) 5.56 (9.46) 6.30 5.59 5.87 (3.08) 3.27 .89 (4.79)
------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total Income (Losses)
From Investment
Operations........... 1.86 9.93 (5.47) 10.24 9.49 9.56 .32 5.63 3.83 (2.11)
-------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Less Distributions
Dividends from Net
Investment Income.... (3.87) (3.42) (3.25) (2.34) (2.22) (2.09) (2.35) 0 (2.23) (4.72)
Distributions from Net
Realized Capital Gains 0 0 (2.95) (1.83) (.16) 0 (.10) 0 0 0
Distributions in Excess of
Net Realized
Capital Gains........ 0 0 (1.20) 0 0 0 0 0 0 0
-------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total Distributions.. (3.87) (3.42) (7.40) (4.17) (2.38) (2.09) (2.45) 0 (2.23) (4.72)
-------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Reverse Share Split... 3.87 3.42 7.40 4.17 2.38 2.09 2.45 0 2.23 4.72
-------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net Asset Value at
End of Period........... $78.72 76.86 66.93 72.40 62.16 52.67 43.11 42.79 37.16 33.33
======== ======= ======= ======= ======= ======= ======= ======= ======= =======
TOTAL RETURN*........... 2.42% 14.84% (7.54)% 16.46% 18.02% 22.18% .75% 15.15% 11.49% (5.95)%
- ------------
SUPPLEMENTAL DATA AND RATIOS
- ----------------------------
Net Assets at End of Period
(in thousands of dollars) $277,298 294,736 243,895 291,418 190,063 89,655 53,216 34,820 14,073 6,285
Ratio of Expenses to Average
Daily Net Assets+++ .61%** .63% .59% .60% .66% .66% .70% .70%** .70% .70%
Ratio of Net Investment
Income to Average
Daily Net Assets+++ 5.78%** 6.13% 5.74% 5.94% 6.90% 7.67% 7.84% 7.81%** 8.33% 8.08%
Portfolio Turnover Rate 7.46% 52.64% 89.35% 76.59% 92.59% 67.39% 78.76% 49.14% 162.54% 72.70%

- ------------------------------------------------------------------------------------------------------------------------------------

+ In 1989, the fiscal year-end for Benham Target Maturities Trust was changed from December 31 to September 30.

++ Per-share data in this table are calculated using the average shares outstanding during the year. Dividends and
distributions shown in the table will be different than the actual per-share distributions to shareholders.

+++The ratios for the period beginning with the year ended September 30, 1995 include expenses paid through expense
offset arrangements.

* Total return figures assume reinvestment of dividends and capital gain distributions and are not annualized.

** Annualized.

</TABLE>

- ------------------------------------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)

2005 PORTFOLIO

For a Share Outstanding Throughout the Six Months Ended March 31 (unaudited) and Years Ended September 30 (except as noted)

PER-SHARE DATA++
- --------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value at
Beginning of Period............ $56.61 45.22 51.84 41.18 35.13 27.74 28.61 24.36 21.28 23.74
Income (Losses) From
Investment Operations
Net Investment Income........ 1.69 3.33 3.11 2.90 2.69 2.47 2.27 1.54 1.90 1.77
Net Realized and Unrealized
Gains (Losses) on
Investments................. (1.06) 8.06 (9.73) 7.76 3.36 4.92 (3.14) 2.71 1.18 (4.23)
-------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total Income (Losses)
From Investment
Operations.................. .63 11.39 (6.62) 10.66 6.05 7.39 (.87) 4.25 3.08 (2.46)
-------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Less Distributions
Dividends from Net
Investment Income........... (2.14) (2.41) (2.70) (2.51) (1.75) (.86) (1.60) 0 (1.53) (3.52)
Distributions from Net
Realized Capital Gains...... (.60) (.67) (8.47) (1.01) (.37) 0 (.07) 0 0 (.13)
-------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Total Distributions......... (2.74) (3.08) (11.17) (3.52) (2.12) (.86) (1.67) 0 (1.53) (3.65)
-------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Reverse Share Split.......... 2.74 3.08 11.17 3.52 2.12 .86 1.67 0 1.53 3.65
-------- ------- ------- ------- ------- ------- ------- ------- ------- -------
Net Asset Value at
End of Period.................. $57.24 56.61 45.22 51.84 41.18 35.13 27.74 28.61 24.36 21.28
======== ======= ======= ======= ======= ======= ======= ======= ======= =======
TOTAL RETURN*.................. 1.11% 25.16% (12.75)% 25.89% 17.22% 26.64% (3.04)% 17.45% 14.48% (10.36)%
- ------------
SUPPLEMENTAL DATA AND RATIOS
- ----------------------------
Net Assets at End of Period
(in thousands of dollars)....$234,007 183,452 96,207 149,890 168,697 161,388 46,303 24,955 8,948 3,680
Ratio of Expenses to Average
Daily Net Assets+++.......... .67%** .71% .64% .62% .63% .70% .70% .70%** .70% .70%
Ratio of Net Investment
Income to Average
Daily Net Assets+++.......... 5.71%** 6.58% 6.37% 6.44% 7.27% 7.80% 7.93% 7.66%** 8.44% 8.31%
Portfolio Turnover Rate...... 17.84% 34.23% 68.11% 49.89% 64.38% 85.38% 186.02% 71.98% 27.25% 68.11%

- ------------------------------------------------------------------------------------------------------------------------------------

+ In 1989, the fiscal year-end for Benham Target Maturities Trust was changed from December 31 to September 30.

+++The ratios for the period beginning with the year ended September 30, 1995 include expenses paid through expense
offset arrangements.

* Total return figures assume reinvestment of dividends and capital gain distributions and are not annualized.

** Annualized.
</TABLE>

- ------------------------------------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)

2010 PORTFOLIO

For a Share Outstanding Throughout the Six Months Ended March 31 (unaudited) and Years Ended September 30 (except as noted)

PER-SHARE DATA++
- --------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value at
Beginning of Period............ $42.14 31.67 38.13 28.53 25.08 19.18 20.59 17.31 14.96 17.65
Income (Losses) From
Investment Operations
Net Investment Income........ 1.25 2.41 2.24 2.05 1.88 1.72 1.61 1.08 1.29 1.23
Net Realized and
Unrealized Gains (Losses)
on Investments.............. (1.20) 8.06 (8.70) 7.55 1.57 4.18 (3.02) 2.20 1.06 (3.92)
-------- ------- -------- ------- ------- ------- ------- ------- ------- --------
Total Income (Losses)
From Investment
Operations.................. .05 10.47 (6.46) 9.60 3.45 5.90 (1.41) 3.28 2.35 (2.69)
-------- ------- -------- ------- ------- ------- ------- ------- ------- --------
Less Distributions
Dividends from Net
Investment Income........... (1.58) (1.48) (1.46) (1.58) (1.14) (1.05) (1.50) 0 (.42) (.90)
Distributions from Net
Realized Capital Gains...... 0 (.48) (4.31) (1.14) 0 0 (.09) 0 0 0
-------- ------- -------- ------- ------- ------- ------- ------- ------- -------
Total Distributions....... (1.58) (1.96) (5.77) (2.72) (1.14) (1.05) (1.59) 0 (.42) (.90)
-------- ------- -------- ------- ------- ------- ------- ------- ------- --------
Reverse Share Split.......... 1.58 1.96 5.77 2.72 1.14 1.05 1.59 0 .42 .90
-------- ------- -------- ------- ------- ------- ------- ------- ------- --------
Net Asset Value at
End of Period.................. $42.19 42.14 31.67 38.13 28.53 25.08 19.18 20.59 17.31 14.96
======== ======= ======== ======= ======= ======= ======= ======= ======= ========
TOTAL RETURN*.................. .12% 33.06% (16.92)% 33.61% 13.76% 30.76% (6.85)% 18.95% 15.71% (15.24)%
- ------------
SUPPLEMENTAL DATA AND RATIOS
- ----------------------------
Net Assets at End of Period
(in thousands of dollars)...$114,095 95,057 46,312 70,551 55,565 47,661 37,222 42,439 9,617 9,297
Ratio of Expenses to Average
Daily Net Assets+++.......... .71%** .71% .68% .66% .70% .70% .70% .70%** .70% .70%
Ratio of Net Investment
Income to Average
Daily Net Assets+++.......... 5.60%** 6.56% 6.35% 6.32% 7.20% 7.73% 7.82% 7.34%** 8.11% 8.13%
Portfolio Turnover Rate...... 16.77% 26.00% 35.35% 131.50% 95.25% 130.91% 191.16% 88.43% 258.70% 83.59%

- ------------------------------------------------------------------------------------------------------------------------------------

+ In 1989, the fiscal year-end for Benham Target Maturities Trust was changed from December 31 to September 30.

+++The ratios for the period beginning with the year ended September 30, 1995 include expenses paid through expense
offset arrangements.

* Total return figures assume reinvestment of dividends and capital gain distributions and are not annualized.

** Annualized.
</TABLE>

- ------------------------------------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)

2015 PORTFOLIO

For a Share Outstanding Throughout the Six Months Ended March 31 (unaudited) and Years Ended September 30 (except as noted)

PER-SHARE DATA++
- --------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value at
Beginning of Period............$32.20 22.79 29.04 20.39 18.44 13.75 15.62 12.63 11.37 14.24
Income (Losses) From
Investment Operations
Net Investment Income........ .89 1.71 1.57 1.46 1.33 1.26 1.18 .79 .94 .90
Net Realized and
Unrealized Gains (Losses)
on Investments.............. (1.36) 7.70 (7.82) 7.19 .62 3.43 (3.05) 2.20 .32 (3.77)
-------- ------- -------- ------- ------- ------- -------- ------- ------- --------
Total Income (Losses)
From Investment
Operations.................. (.47) 9.41 (6.25) 8.65 1.95 4.69 (1.87) 2.99 1.26 (2.87)
-------- ------- -------- ------- ------- ------- -------- ------- ------- --------
Less Distributions
Dividends from Net
Investment Income........... (1.27) (.87) (1.19) (1.45) (1.23) (.97) (.50) 0 (.55) (.22)
Distributions from Net
Realized Capital Gains...... (1.59) 0 (7.08) (.34) 0 0 (.01) 0 0 0
Distributions in Excess of Net
Realized Capital Gains...... 0 0 (.37) 0 0 0 0 0 0 0
-------- ------- -------- ------- ------- ------- -------- ------- ------- --------
Total Distributions......... (2.86) (.87) (8.64) (1.79) (1.23) (.97) (.51) 0 (.55) (.22)
-------- ------- -------- ------- ------- ------- -------- ------- ------- --------
Reverse Share Split.......... 2.86 .87 8.64 1.79 1.23 .97 .51 0 .55 .22
-------- ------- -------- ------- ------- ------- -------- ------- ------- --------
Net Asset Value at
End of Period..................$31.73 32.20 22.79 29.04 20.39 18.44 13.75 15.62 12.63 11.37
======== ======= ======== ======= ======= ======= ======== ======= ======= ========
TOTAL RETURN*.................. 1.46% 41.29% (21.52)% 42.42% 10.57% 34.11% (11.97)% 23.67% 11.08% (20.15)%
- ------------
SUPPLEMENTAL DATA AND RATIOS
- ----------------------------
Net Assets at End of Period
(in thousands of dollars)..$119,108 114,647 66,073 89,023 131,106 222,118 295,577 233,792 11,790 2,006
Ratio of Expenses to Average
Daily Net Assets+++.......... .71%** .71% .68% .63% .62% .61% .70% .70%** .70% .70%
Ratio of Net Investment
Income to Average
Daily Net Assets+++.......... 5.17%** 6.40% 5.97% 6.28% 7.04% 7.79% 7.74% 7.02%** 7.97% 7.99%
Portfolio Turnover Rate...... 9.25% 69.97% 64.90% 138.34% 103.25% 39.91% 81.27% 48.31% 188.24% 508.59%

- ------------------------------------------------------------------------------------------------------------------------------------

+ In 1989, the fiscal year-end for Benham Target Maturities Trust was changed from December 31 to September 30.

+++The ratios for the period beginning with the year ended September 30, 1995 include expenses paid through expense
offset arrangements.

* Total return figures assume reinvestment of dividends and capital gain distributions and are not annualized.

** Annualized.
</TABLE>

- ------------------------------------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)

2020 PORTFOLIO

For a Share Outstanding Throughout the Six Months Ended March 31 (unaudited) and Years Ended September 30 (except as noted)

Mar. 31
1996 Sept. 30, Sept. 30, Sept. 30, Sept. 30, Sept. 30, Sept. 30,
(unaudited) 1995 1994 1993 1992 1991 1990+
- ------------------------------------------------------------------------------------------------------------------------------------

PER-SHARE DATA++
- --------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value at
Beginning of Period.................... $22.47 15.28 20.72 13.63 12.54 9.63 12.00
Income (Losses) From Investment Operations
Net Investment Income................ .67 1.19 1.13 1.00 .92 .85 .60
Net Realized and Unrealized Gains (Losses)
on Investments...................... (1.25) 6.00 (6.57) 6.09 .17 2.06 (2.97)
-------- ------ -------- ------- ------- ------- --------
Total Income (Losses) From
Investment Operations............... (.58) 7.19 (5.44) 7.09 1.09 2.91 (2.37)
-------- ------ -------- ------- ------- ------- --------
Less Distributions
Dividends from Net Investment Income. (.48) (.21) (0.28) (.53) (.63) (.21) 0
Distributions from Net Realized Capital Gains (.05) 0 (1.31) (.72) (.08) 0 0
Distributions in Excess of
Net Realized Capital Gains.......... 0 0 (1.18) 0 0 0 0
-------- ------ -------- ------- ------- ------- --------
Total Distributions................. (.53) (.21) (2.77) (1.25) (.71) (.21) 0
-------- ------ -------- ------- ------- ------- --------
Reverse Share Split.................. .53 .21 2.77 1.25 .71 .21 0
-------- ------ -------- ------- ------- ------- --------
Net Asset Value at End of Period....... $21.89 22.47 15.28 20.72 13.63 12.54 9.63
======== ====== ======== ======= ======= ======= ========
TOTAL RETURN*.......................... (2.58)% 47.05% (26.25)% 52.02% 8.69% 30.22% (19.75)%
- ------------
SUPPLEMENTAL DATA AND RATIOS
- ----------------------------
Net Assets at End of Period
(in thousands of dollars)............ $768,720 574,702 58,535 56,125 41,793 88,332 53,198
Ratio of Expenses to Average
Daily Net Assets+++.................. .71%** .72% .70% .70% .66% .67% .70%**
Ratio of Net Investment Income to
Average Daily Net Assets+++......... 5.55%** 6.24% 6.28% 6.10% 7.19% 7.50% 7.79%**
Portfolio Turnover Rate.............. 33.85% 78.08% 116.46% 178.52% 144.05% 151.44% 188.60%

- ------------------------------------------------------------------------------------------------------------------------------------

+ From December 29, 1989 (commencement of operations), through September 30, 1990.

+++The ratios for the period beginning with the year ended September 30, 1995 include expenses paid through expense
offset arrangements.

* Total return figures assume reinvestment of dividends and capital gain distributions and are not annualized.

** Annualized.
</TABLE>

- ------------------------------------------------------------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)

2025 PORTFOLIO

For a Share Outstanding From February 15, 1996 (commencement of operations), through June 30, 1996 (Unaudited)

1996
- ------------------------------------------------------------------------------------------------------------------------------------

PER-SHARE DATA+
- --------------
<S> <C>
NET ASSET VALUE AT BEGINNING OF PERIOD......................................................... $19.85
Income From Investment Operation
Net Investment Income........................................................................ .43
Net Realized and Unrealized Losses on Investments............................................ (2.45)
--------
Total Losses From Investment Operations..................................................... (2.02)
--------
Less Distributions
Dividends from Net Investment Income......................................................... 0
--------
Reverse Share Split.......................................................................... 0
--------
NET ASSET VALUE AT END OF PERIOD............................................................... $17.83
========
TOTAL RETURN*.................................................................................. (10.18)%
- ------------
SUPPLEMENTAL DATA AND RATIOS
- ----------------------------
Net Assets at End of Period (in thousands of dollars)........................................ $30,463
Ratio of Expenses to Average Daily Net Assets++.............................................. .71%**
Ratio of Net Investment Income to Average Daily Net Assets++................................ 6.48%**
Portfolio Turnover Rate...................................................................... 30.53%

- ------------------------------------------------------------------------------------------------------------------------------------

+ Per-share data in this table are calculated using the average shares outstanding during the period.

++ These ratios include expenses paid through expense offset arrangements.

* Total return figures assume reinvestment of dividends and capital gain distributions and are not annualized.

** Annualized.
</TABLE>

INFORMATION REGARDING THE FUNDS
- --------------------------------------------------------------------------------

INVESTMENT POLICIES
OF THE FUNDS

The Funds have adopted certain investment restrictions that are set
forth in the Statement of Additional Information. Those restrictions, as well
as the investment objectives of the Funds identified below and any other
investment policies designated as "fundamental" in this Prospectus or in the
Statement of Additional Information, cannot be changed without shareholder
approval. The Funds have implemented additional investment policies and
practices to guide their activities in the pursuit of their respective
investment objectives. These policies and practices, which are described
throughout this Prospectus, are not designated as fundamental policies and
may be changed without shareholder approval.

The descriptions that follow are designed to help you determine whether
a fund fits your investment objectives. An investment in the Funds by itself
does not constitute a balanced investment plan.

For an explanation of the securities ratings referred to in the
following discussion, see "Other Information" in the Statement of Additional
Information.

INVESTMENT OBJECTIVES OF THE FUNDS

Benham Target Maturities Trust currently consists of six Funds with
target maturity years of 2000, 2005, 2010, 2015, 2020, and 2025,
respectively. Each Fund will be liquidated shortly after the conclusion of
its target maturity year. Additional funds may be introduced from time to
time. There is no assurance that a Fund will achieve its investment
objective.

Each Fund seeks to provide the highest attainable investment return
consistent with the creditworthiness of U.S. Treasury securities and the
professional management of reinvestment and market risks.

INVESTMENT POLICIES

Each Fund invests primarily in zero-coupon U.S. Treasury securities (a
"zero"). Unlike U.S. Treasury securities with coupons attached, which pay
interest periodically, zeros pay no interest. Instead, these securities are
issued at a substantial discount from their maturity value, and this discount
is amortized over the life of the security. Investment return comes from the
difference between the price at which a zero is issued (or purchased) and the
price at which it matures (or is sold).

To approximate the experience an investor would have if he or she
purchased zeros directly, the Manager manages each Fund to track as closely
as possible the price behavior of a zero with the same term to maturity. To
correct for factors such as shareholder purchases and redemptions (and
related transaction costs) that differentiate investing in a portfolio of
zeros from investing directly in a zero, the Manager executes portfolio
transactions necessary to accommodate shareholder activity each business day.
To limit reinvestment risk, the Manager adjusts each Fund's weighted average
maturity ("WAM") to fall within the Fund's target maturity year so that,
normally, at least 90% of the securities held mature within one year of the
Fund's target maturity year.

By adhering to these investment parameters, the Manager expects that
shareholders who hold their shares until a Fund's WAM*, and who reinvest all
dividends and capital gain distributions, will realize an investment return
and a maturity value that does not differ substantially from the anticipated
growth rate ("AGR") and anticipated value at maturity ("AVM") calculated on
the day the shares were purchased.

The Manager calculates each Fund's AGR and AVM each day the Trust is
open for business. AGR and AVM daily calculations assume, among other
factors, that the Fund's expense ratio and portfolio composition remain
constant for the life of the Fund.

Transaction costs, interest rate changes, and the Manager's efforts to
improve total return by taking advantage of market opportunities also cause
the Funds' AGRs and AVMs to vary from day to day. Despite these so-called
"destabilizing" factors, however, each Fund's AGR and AVM tend to fluctuate
within narrow ranges. The following table shows each Fund's AVM as of
September 30 for each of the past five years. (AGRs are illustrated in the
Statement of Additional Information.)

ANTICIPATED VALUE AT MATURITY

9/30/91 9/30/92 9/30/93 9/30/94 9/30/95
------- ------- ------- ------- -------
2000 Portfolio 98.28 101.01 100.69 100.86 100.99
2005 Portfolio 98.72 99.78 100.21 100.58 100.32
2010 Portfolio 98.54 100.11 100.94 101.38 101.02
2015 Portfolio 105.13 107.05 106.84 107.95 109.62
2020 Portfolio 94.04 101.83 100.76 102.11 102.31

The Funds' share prices and growth rates are not guaranteed by the
Trust, the Manager, or any of their affiliates. There is no guarantee that
the Funds' AVMs will fluctuate as little in the future as they have in the
past.
*A Fund's weighted average maturity date can be calculated at any point
in time by adding its WAM to the current date. For example, if today were
November 17, 1995, and the Fund's WAM were six years, the Fund's weighted
average maturity date would be November 17, 2001. Please note that a Fund's
weighted average maturity date typically precedes the date on which the Fund
will be liquidated. For details on Fund liquidation, see page 22.

ZERO COUPON SECURITIES

Zero-coupon U.S. Treasury securities (or zeros) are the unmatured
interest coupons and underlying principal portions of U.S. Treasury bonds.
Originally, these securities were created by broker-dealers who bought
Treasury bonds and deposited these securities with a custodian bank. The
broker-dealers then sold receipts representing ownership interests in the
coupons or principal portions of the bonds. Some examples of zero-coupon
securities sold through custodial receipt programs are CATS (Certificates of
Accrual on Treasury Securities), TIGRs (Treasury Investment Growth Receipts),
and generic TRs (Treasury Receipts).

The U.S. Treasury subsequently introduced a program called Separate
Trading of Registered Interest and Principal of Securities ("STRIPS"),
through which it exchanges eligible securities for their component parts and
then allows the component parts to trade in book-entry form. (Book-entry
trading eliminates the bank credit risks associated with
broker-dealer-sponsored custodial receipt programs.) STRIPS are direct
obligations of the U.S. government and have the same credit risks as other
U.S. Treasury securities.

Principal and interest on bonds issued by the Resolution Funding
Corporation ("REFCORP") have also been separated and issued as zero-coupon
securities. The U.S. government and its agencies may issue securities in
zero-coupon form. These securities are referred to as "original issue
zero-coupon securities."

OTHER INVESTMENTS

As a Fund's target maturity year approaches, the Manager may buy
coupon-bearing securities whose duration and price characteristics are
similar to those of aging zero-coupon securities. Towards the end of a Fund's
target maturity year and until the Fund is liquidated, the proceeds of
maturing zero-coupon securities are invested in U.S. Treasury bills.

OTHER INVESTMENT PRACTICES,
THEIR CHARACTERISTICS AND RISKS

The Funds are designed for investors with long-term financial goals that
correspond to one or more of the target maturities offered. Investors who use
zeros or the Funds for short-term speculative purposes should understand
that, although most of the reinvestment risk associated with coupon-bearing
bonds has been eliminated, the

prices of zeros can fluctuate dramatically between issuance and maturity.
When interest rates rise, the price of a zero falls more sharply than the
price of a coupon-bearing security of the same maturity. Correspondingly,
when interest rates fall, the price of a zero rises more sharply than the
price of a coupon-bearing security.

Each Fund's share price will fluctuate daily in response to Fund
activity and changes in the market value of its investments. Due to the price
volatility of zeros, redemptions made prior to a Fund's target maturity year
may result in unanticipated capital gains or losses for the Funds. These
capital gains and losses will be distributed to shareholders regardless of
whether they have redeemed shares. Although shareholders have the option to
redeem shares on any business day, those seeking to minimize their exposure
to share price volatility should plan to hold their shares until the end of
their Fund's target maturity year.

Investing in a portfolio of zeros is different from investing directly
in a zero. Although the Manager adheres to investment policies designed to
assure close correspondence between the price behavior of a Fund and that of
a zero with the same maturity characteristics, precise forecasts of maturity
value and yield to maturity are not possible.

For additional information regarding the investment practices of any of
the Funds, see the Statement of Additional Information.

COUPON-BEARING U.S. TREASURY SECURITIES

U.S. Treasury bills, notes, and bonds are direct obligations of the U.S.
Treasury. Historically, they have involved no risk of loss of principal if
held to maturity. Between issuance and maturity, however, the prices of these
securities change in response to changes in market interest rates.
Coupon-bearing securities generate current interest payments, and part of a
Fund's return may come from reinvesting interest earned on these securities.

REFCORP BONDS

REFCORP issues bonds whose interest payments are guaranteed by the U.S.
Treasury and whose principal amounts are secured by zero-coupon U.S. Treasury
securities held in a separate custodial account at the Federal Reserve Bank
of New York. The principal amount and maturity date of REFCORP bonds are the
same as the par amount and maturity date of the corresponding zeros; upon
maturity, REFCORP bonds are repaid from the proceeds of the zeros.

CASH MANAGEMENT

Each Fund may invest up to 5% of its total assets in money market funds,
including those advised by the Manager, provided that the investment is
consistent with the Fund's investment policies and restrictions.

SECURITIES LENDING

The Funds may lend portfolio securities to broker-dealers to earn
additional income. This practice could result in a loss or a delay in
recovering the Fund's securities. Securities loans are subject to guidelines
prescribed by the board of trustees, which are set forth in the Statement of
Additional Information. Loans are limited to one-third of the Fund's total
assets and must be fully collateralized.

PORTFOLIO TURNOVER

The portfolio turnover rates of the Funds are shown in the Financial
Highlights tables on pages 4, 5, 6, 7, 8 and 9 of this Prospectus.

With respect to each series of shares, investment decisions to purchase
and sell securities are based on the anticipated contribution of the security
in question to the particular fund's objectives. The rate of portfolio
turnover is irrelevant when management believes a change is in order to
achieve those objectives and, accordingly, the annual portfolio turnover rate
cannot be accurately anticipated.

The portfolio turnover of each Fund may be higher than other mutual
funds with similar investment objectives. The Funds' annual portfolio
turnover rates are not expected to exceed 150% and may vary from year to
year. An annual portfolio turnover rate of 100% or more is considered high. A
high turnover rate involves correspondingly higher transaction costs that are
borne directly by a Fund. It may also affect the character of capital gains,
if any, realized and distributed by a Fund since short-term capital gains are
taxable as ordinary income.

U.S. GOVERNMENT SECURITIES

Generally, the state tax-exempt interest income earned by the Funds is
passed through to the Funds' shareholders as state tax-free dividends.

Each Fund may therefore quote state tax-equivalent yields, which show
the state taxable yields an investor would have to earn before taxes to equal
the Fund's state tax-free yields. As a prospective investor in the Funds, you
should determine whether your state tax-equivalent yield is likely to be
higher with a taxable or with a tax-exempt Fund. To determine this, you may
use the formulas depicted below.
The tax-equivalent yield is based on each Fund's current state tax-free
yield and your state income tax rate. The formula is:

Fund's State Tax-Free Yield Your State
---------------------------- = Tax-Equivalent
100% - State Tax Rate Yield

PERFORMANCE ADVERTISING

From time to time, the Funds may advertise performance data. Fund
performance may be shown by presenting one or more performance measurements,
including cumulative total return or average annual total return, yield,
effective yield and tax-equivalent yield(for tax-exempt funds).

CUMULATIVE TOTAL RETURN data is computed by considering all elements of
return, including reinvestment of dividends and capital gains distributions,
over a period of time. AVERAGE ANNUAL TOTAL RETURN over a states period of
time that would have produced a fund's cumulative total return over the same
period if the fund's performance had remained constant throughout.

A quotation of YIELD reflects a fund's income over a stated period
expressed as a percentage of the fund's share price. The EFFECTIVE YIELD is
calculated in a similar manner but, when annualized, the income earned by the
investment is assumed to be reinvested. The effective yield will be slightly
higher than the yield because of the compounding effect on the assumed
reinvestment.

Yield is calculated by adding over a 30-day (or one-month) period all
interest and dividend income (net of fund expenses) calculated on each day's
market values, dividing this sum by the average number of fund shares
outstanding during the period, and expressing the result as a percentage of
the fund's share price on the last day of the 30-day (or one month) period.
The percentage is then annualized. Capital gains and losses are not included
in the calculation.

Yields are calculated according to accounting methods that are
standardized in accordance with SEC rules. The SEC yield should be regarded
as an estimate of the Fund's rate of investment income, and it may not equal
the Fund's actual income distribution rate, the income paid to a
shareholder's account, or the income reported in the Fund's financial
statements.

A TAX-EQUIVALENT YIELD demonstrates the taxable yield necessary to
produce after-tax yield equivalent to that of a mutual fund which invests in
exempt obligations. (See "U.S. Government Securities," this page, for a
description of the formulas used in comparing yields to tax-equivalent
yields.)

The Funds may also include in advertisements data comparing performance
with the performance of non-related investment media, published editorial
comments and performance rankings compiled by independent organizations (such
as Lipper Analytical Services or Donoghue's Money Fund Report) and
publications that monitor the performance of mutual funds. Performance
information may be quoted numerically or may be presented in a table, graph
or other illustration. In addition, fund performance may be compared to
well-known indices of market performance. A fund's performance may also be
compared, on a relative basis, to the other funds in our fund family. This
relative comparison, which may be based upon historical or expected fund
performance, volatility or other fund characteristics, may be presented
numerically, graphically or in text. The performance of a fund may also be
combined or blended with other funds in our fund family, and that combined or
blended performance may be compared to the same indices to which individual
funds may be compared.

All performance information advertised by the Funds is historical in
nature and is not intended to represent or guarantee future results. The
value of Fund shares when redeemed may be more or less than their original
cost.

HOW TO INVEST WITH TWENTIETH CENTURY AND THE BENHAM GROUP
- --------------------------------------------------------------------------------

The following section explains how to invest with Twentieth Century and
The Benham Group, including purchases, redemptions, exchanges and special
services. You will find more detail about doing business with us by referring
to the Investor Services Guide that you will receive when you open an
account.

If you own or are considering purchasing Fund shares through an
employer-sponsored retirement plan or through a bank, broker-dealer or other
financial intermediary, the following sections, as well as the information
contained in our Investor Services Guide, may not apply to you. Please read
"Employer-Sponsored Retirement Plans and Institutional Accounts," page 20.

HOW TO OPEN AN ACCOUNT

To open an account, you must complete and sign an application,
furnishing your taxpayer identification number. (You must also certify
whether you are subject to withholding for failing to report income to the
IRS.) Investments received without a certified taxpayer identification number
will be returned.

The minimum investment is $2,500 ($1,000 for IRA accounts). These
minimums will be waived if you establish an automatic investment plan to your
account that is the equivalent of at least $50 per month. See "Automatic
Investment Plan," page 16.

The minimum investment requirements may be different for some types of
retirement accounts. Call one of our Investor Services Representatives for
information on our retirement plans, which are available for individual
investors or for those investing through their employers.

Please note: If you register your account as belonging to multiple
owners (e.g., as joint tenants), you must provide us with specific
authorization on your application in order for us to accept written or
telephone instructions from a single owner. Otherwise, all owners will have
to agree to any transactions that involve the account (whether the
transaction request is in writing or over the telephone).

You may invest in the following ways:

BY MAIL

Send a completed application and check or money order payable in U.S.
dollars to Twentieth Century.

BY WIRE

You may make your initial investment by wiring funds. To do so, call us
or mail a completed application and provide your bank with the following
information:

RECEIVING BANK AND ROUTING NUMBER:
Commerce Bank, N.A. (101000019)

BENEFICIARY (BNF):
Twentieth Century Services, Inc.
4500 Main St., Kansas City, MO 64111

BENEFICIARY ACCOUNT NUMBER (BNF ACCT):
2804918

REFERENCE FOR BENEFICIARY (RFB):
Twentieth Century account number into which you are investing. If more
than one, leave blank and see Bank to Bank Information below.

ORIGINATORTO BENEFICIARY (OBI):
Name and address of owner of account into which you are investing.

BANK TO BANK INFORMATION
(BBI OR FREE FORM TEXT):
o Taxpayer identification or social security number
o If more than one account, account numbers and amount to be invested in
each account.
o Current tax year, previous tax year or rollover designation if an IRA.
Specify whether IRA, SEP-IRA or SARSEP-IRA.

BY EXCHANGE

Call 1-800-345-2021 from 7 a.m. to 7 p.m. Central time to get
information on opening an account by exchanging from another Twentieth
Century or Benham account. See page 16 for more information on exchanges.

IN PERSON

If you prefer to work with a representative in person, please visit one
of our Investors Centers, located at:

4500 Main Street
Kansas City, MO 64111

1665 Charleston Road
Mountain View, CA 94043

2000 S. Colorado Blvd.
Denver, CO 80222.

SUBSEQUENT INVESTMENTS

Subsequent investments may be made by an automatic bank, payroll or
government direct deposit (see "Automatic Investment Plan," this page) or by
any of the methods below. The minimum investment requirement for subsequent
investments: $250 for checks submitted without the remittance portion of a
previous statement or confirmation, $50 for all other types of subsequent
investments.

BY MAIL

When making subsequent investments, enclose your check with the
remittance portion of the confirmation of a previous investment. If the
remittance slip is not available, indicate your name, address and account
number on your check or a separate piece of paper. (Please be aware that the
investment minimum for subsequent investments is higher without a remittance
slip.)

BY TELEPHONE

Once your account is open, you may make investments by telephone if you
have authorized us (by choosing "Full Services" on your application) to draw
on your bank account. You may call an Investor Services Representative or use
our Automated Information Line.

BY WIRE

You may make subsequent investments by wire. Follow the wire transfer
instructions on page 15 and indicate your account number.

IN PERSON

You may make subsequent investments in person at one of our Investors
Centers. The locations of our three Investors Centers are listed on this
page.

AUTOMATIC INVESTMENT PLAN

You may elect on your application to make investments automatically by
authorizing us to draw on your bank account regularly. Such investments must
be at least the equivalent of $50 per month. You also may choose an automatic
payroll or government direct deposit. If you are establishing a new account,
check the appropriate box under "Automatic Investments" on your application
to receive more information. If you would like to add a direct deposit to an
existing account, please call one of our Investor Services Representatives.

HOW TO EXCHANGE FROM ONE
ACCOUNT TO ANOTHER

As long as you meet any minimum initial investment requirements, you may
exchange your Fund shares to our other funds up to six times per year per
account. For any single exchange, the shares of each fund being acquired must
have a value of at least $100. However, we will allow investors to set up an
Automatic Exchange Plan between any two funds in the amount of at least $50
per month. See our Investor Services Guide for further information about
exchanges.

BY MAIL

You may direct us in writing to exchange your shares from one Twentieth
Century or Benham account to another. For additional information, please see
our Investor Services Guide.

BY TELEPHONE

You can make exchanges over the phone (either with an Investor Services
Representative or using our Automated Information Line--see page 18) if you
have authorized us to accept telephone instructions. You can authorize this
by selecting "Full Services" on your application or by calling us at
1-800-345-2021 to receive the appropriate form.

HOW TO REDEEM SHARES

We will redeem or "buy back" your shares at any time. Redemptions will
be made at the next net asset value determined after a complete redemption
request is received.

Please note that a request to redeem shares in an IRA or 403(b) plan
must be accompanied by an executed IRS Form W4-P and a reason for withdrawal
as specified by the IRS.

BY MAIL

Your written instructions to redeem shares may be made either by a
redemption form, which we will send to you upon request, or by a letter to
us. Certain redemptions may require a signature guarantee. Please see
"Signature Guarantee," page 18.

BY TELEPHONE

If you have authorized us to accept telephone instructions, you may
redeem your shares by calling an Investor Services Representative.

BY CHECK-A-MONTH

If you have at least a $10,000 balance in your account, you may redeem
shares by Check-A-Month. A Check-A-Month plan automatically redeems enough
shares each month to provide you with redemption proceeds in an amount you
choose (minimum $50). To set up a Check-A-Month plan, please call and request
our Check-A-Month brochure.

OTHER AUTOMATIC REDEMPTIONS

You may elect to make redemptions automatically by authorizing us to
send funds directly to you or to your account at a bank or other financial
institution. To set up automatic redemptions, call one of our Investor
Services Representatives.

REDEMPTION PROCEEDS

Please note that shortly after a purchase of shares is made by check or
electronic draft (also known as an ACH draft) from your bank, we may wait up
to 15 days or longer to send redemption proceeds (to allow your purchase
funds to clear). No interest is paid on the redemption proceeds after the
redemption is processed but before your redemption proceeds are sent.

Redemption proceeds may be sent to you in one of the following ways:

BY CHECK

Ordinarily, all redemption checks will be made payable to the registered
owner of the shares and will be mailed only to the address of record. For
more information, please refer to our Investor Services Guide.

BY WIRE AND ACH

You may authorize us to transmit redemption proceeds by wire or ACH.
These services will be effective 15 days after we receive the authorization.

Your bank will usually receive wired funds within 48 hours of
transmission. Funds transferred by ACH may be received up to seven days after
transmission. Wired funds are subject to a $10 fee to cover bank wire
charges, which is deducted from redemption proceeds. Once the funds are
transmitted, the time of receipt and the funds' availability are not under
our control.

REDEMPTION OF SHARES
IN LOW-BALANCE ACCOUNTS

Whenever the shares held in an account have a value of less than the
required minimum, a letter will be sent advising you of the necessity to
bring the value of the shares held in the account up to the minimum. If
action is not taken within 90 days of the letter's date, the shares held in
the account will be redeemed and proceeds from the redemption will be sent by
check to your address of record. We reserve the right to increase the
investment minimums.

SIGNATURE GUARANTEE

To protect your accounts from fraud, some transactions will require a
signature guarantee. Which transactions will require a signature guarantee
will depend on which service options you elect when you open your account.
For example, if you choose "In Writing Only," a signature guarantee will be
required when:

o Redeeming more than $25,000
o Establishing or increasing a Check-A-Month or automatic transfer on an
existing account.

You may obtain a signature guarantee from a bank or trust company,
credit union, broker- dealer, securities exchange or association, clearing
agency or savings association, as defined by federal law.

For a more in-depth explanation of our signature guarantee policy, or if
you live outside the United States and would like to know how to obtain a
signature guarantee, please consult our Investor Services Guide.

We reserve the right to require a signature guarantee on any
transaction, or to change this policy at any time.

SPECIAL INVESTOR SERVICES

We offer several service options to make your account easier to manage.
These are listed on the account application. Please make note of these
options and elect the ones that are appropriate for you. Be aware that the
"Full Services" option offers you the most flexibility. You will find more
information about each of these service options in our Investor Services
Guide.

Our special investor services include:

AUTOMATED INFORMATION LINE

We offer an Automated Information Line, 24 hours a day, seven days a
week, at 1-800-345-8765. By calling the Automated Information Line, you may
listen to fund prices, yields and total return figures. You may also use the
Automated Information Line to make investments into your accounts (if we have
your bank information on file) and obtain your share balance, value and most
recent transactions. If you have authorized us to accept telephone
instructions, you also may exchange shares from one fund to another via the
Automated Information Line. Redemption instructions cannot be given via the
Automated Information Line.

OPEN ORDER SERVICE

Through our open order service, you may designate a price at which to
buy shares of a variable-priced fund by exchange from one of our money market
funds, or a price at which to sell shares of a variable-priced fund by
exchange to one of our money market funds. The designated purchase price must
be equal to or lower, or the designated sale price equal to or higher, than
the variable-priced fund's net asset value at the time the order is placed,
If the designated price is met within 90 calendar days, we will execute your
exchange order automatically at that price (or better). Open orders not
executed within 90 days will be canceled.

If the fund you have selected deducts a distribution from its share
price, your order price will be adjusted accordingly so the distribution does
not inadvertently trigger an open order transaction on your behalf. If you
close or re-register the account from which the shares are to be redeemed,
your open order will be canceled.

Because of their time-sensitive nature, open order transactions are
accepted only by telephone or in person. These transactions are subject to
exchange limitations described in each fund's prospectus, except that orders
and cancellations received before 2 p.m. Central time are effective the same
day, and orders or cancellations received after 2 p.m. Central time are
effective the next business day.

TAX-QUALIFIED RETIREMENT PLANS

Each Fund is available for your tax-deferred retirement plan. Call or
write us and request the appropriate forms for:

o Individual Retirement Accounts ("IRAs")
o 403(b) plans for employees of public school systems and non-profit
organizations
o Profit sharing plans and pension plans for corporations and other
employers.

If your IRA and 403(b) accounts do not total $10,000, each account is
subject to an annual $10 fee, up to a total of $30 per year.

You can also transfer your tax-deferred plan to us from another company
or custodian. Call or write us for a "Request to Transfer" form.

IMPORTANT POLICIES REGARDING
YOUR INVESTMENTS

Every account is subject to policies that could affect your investment.
Please refer to the Investor Services Guide for further information about the
policies discussed below, as well as further detail about the services we
offer.
(1) We reserve the right for any reason to suspend the offering of shares
for a period of time, or to reject any specific purchase order
(including purchases by exchange). Additionally, purchases may be
refused if, in the opinion of the manager, they are of a size that
would disrupt the management of the fund.

(2) We reserve the right to make changes to any stated investment
requirements, including those that relate to purchases, transfers and
redemptions. In addition, we may also alter, add to or terminate any
investor services and privileges. Any changes may affect all
shareholders or only certain series or classes of shareholders.

(3) Shares being acquired must be qualified for sale in your state of
residence.

(4) Transactions requesting a specific price and date, other than open
orders, will be refused.

(5) If a transaction request is made by a corporation, partnership,
trust, fiduciary, agent or unincorporated association, we will
require evidence satisfactory to us of the authority of the
individual making the request.

(6) We have established procedures designed to assure the authenticity of
instructions received by telephone. These procedures include
requesting personal identification from callers, recording telephone
calls, and providing written confirmations of telephone transactions.
These procedures are designed to protect shareholders from
unauthorized or fraudulent instructions. If we do not employ
reasonable procedures to confirm the genuineness of instructions,
then we may be liable for losses due to unauthorized or fraudulent
instructions. The company, its transfer agent and investment adviser
will not be responsible for any loss due to instructions they
reasonably believe are genuine.

(7) All signatures should be exactly as the name appears in the
registration. If the owner's name appears in the registration as Mary
Elizabeth Jones, she should sign that way and not as Mary E. Jones.

(8) Unusual stock market conditions have in the past resulted in an
increase in the number of shareholder telephone calls. If you
experience difficulty in reaching us

during such periods, you may send your transaction instructions by
mail, express mail or courier service, or you may visit one of our
Investors Centers. You may also use our Automated Information Line if
you have requested and received an access code and are not attempting
to redeem shares.

(9) If you fail to provide us with the correct certified taxpayer
identification number, we may reduce any redemption proceeds by $50
to cover the penalty the IRS will impose on us for failure to report
your correct taxpayer identification number on information reports.

(10) We will perform special inquiries on shareholder accounts. A research
fee of $15 may be applied.

REPORTS TO SHAREHOLDERS

At the end of each calendar quarter, we will send you a consolidated
statement that summarizes all of your Twentieth Century and Benham holdings,
as well as an individual statement for each fund you own that reflects all
year-to-date activity in your account. You may request a statement of your
account activity at any time.

With the exception of most automatic transactions, each time you invest,
redeem, transfer or exchange shares, we will send you a confirmation of the
transactions. See the Investor Services Guide for more detail.

Carefully review all the information relating to transactions on your
statements and confirmations to ensure that your instructions were acted on
properly. Please notify us immediately in writing if there is an error. If
you fail to provide notification of an error with reasonable promptness,
i.e., within 30 days of non-automatic transactions or within 30 days of the
date of your consolidated quarterly statement, in the case of automatic
transactions, we will deem you to have ratified the transaction.

No later than January 31st of each year, we will send you reports that
you may use in completing your U.S. income tax return. See the Investor
Services Guide for more information.

Each year, we will send you an annual and a semiannual report relating
to your fund, each of which is incorporated herein by reference. The annual
report includes audited financial statements and a list of portfolio
securities as of the fiscal year end. The semiannual report includes
unaudited financial statements for the first six months of the fiscal year,
as well as a list of portfolio securities at the end of the period. You also
will receive an updated prospectus at least once each year. Please read these
materials carefully as they will help you understand your fund.

EMPLOYER-SPONSORED
RETIREMENT PLANS AND
INSTITUTIONAL ACCOUNTS

Information contained in our Investor Services Guide and in the "How to
Invest" sections beginning on page 15 pertain to shareholders who invest
directly with Twentieth Century rather than through an employer-sponsored
retirement plan or through a financial intermediary. If you own or are
considering purchasing Fund shares through an employer-sponsored retirement
plan, your ability to purchase shares of the Funds, exchange them for shares
of other Twentieth Century or Benham funds, and redeem them will depend on
the terms of your plan. If you own or are considering purchasing Fund shares
through a bank, broker-dealer, insurance company or other financial
intermediary, your ability to purchase, exchange and redeem shares will
depend on your agreement with, and the policies of, such financial
intermediary.

You may reach one of our Institutional Investor Service Representatives
by calling 1-800-345-3533 to request information about our funds and
services, to obtain a current prospectus or to get answers to any questions
about our Funds that you are unable to obtain through your plan administrator
or financial intermediary.

ADDITIONAL INFORMATION YOU SHOULD KNOW
- --------------------------------------------------------------------------------

SHARE PRICE

WHEN SHARE PRICE IS DETERMINED

The price of your shares is also referred to as their net asset value.
Net asset value is determined by calculating the total value of a fund's
assets, deducting total liabilities and dividing the result by the number of
shares outstanding. Net asset value is determined at the close of regular
trading on each day that the New York Stock Exchange (the "Exchange") is
open.

Investments and requests to redeem or exchange shares will receive the
share price next determined after receipt by us of the investment, redemption
or exchange request. For example, investments and requests to redeem or
exchange shares received by us or our authorized agents ONE HOUR BEFORE the
close of business on the Exchange, usually 2 p.m. Central time, are effective
on, and will receive the price determined, that day as of the close of the
Exchange. Investment, redemption and exchange requests received thereafter
are effective on, and receive the price determined as of, the close of the
Exchange on the next day the Exchange is open.

Investments are considered received only when your check or wired funds
are received by us. Wired funds are considered received on the day they are
deposited in our bank account if your telephone call is received ONE HOUR
BEFORE the close of business on the Exchange, usually
2 p.m. Central time and the money is deposited that day.

Investments by telephone pursuant to your prior authorization to us to
draw on your bank account are considered received at the time of your
telephone call.

Investment and transaction instructions received by us on any business
day by mail prior to the close of business on the Exchange will receive that
day's price. Investments and instructions received after that time will
receive the price determined on the next business day.

If you invest in fund shares through an employer-sponsored retirement
plan or other financial intermediary, it is the responsibility of your plan
recordkeeper or financial intermediary to transmit your purchase, exchange
and redemption requests to the fund's transfer agent prior to the applicable
cut-off time for receiving orders and to make payment for any purchase
transactions in accordance with the fund's procedures or any contractual
arrangement with the fund or the fund's distributor in order for you to
receive that day's price.

HOW SHARE PRICE IS DETERMINED

The valuation of assets for determining net asset value may be
summarized as follows:

Portfolio securities of each Fund, except as otherwise noted, listed or
traded on a domestic securities exchange are valued at the last sale price on
that exchange. Portfolio securities primarily traded on foreign securities
exchanges are generally valued at the preceding closing values of such
securities on the exchange where primarily traded. If no sale is reported, or
if local convention or regulation so provides, the mean of the latest bid and
asked prices is used. Depending on local convention or regulation, securities
traded over-the-counter are priced at the mean of the latest bid and asked
prices, or at the last sale price. When market quotations are not readily
available, securities and other assets are valued at fair value as determined
in accordance with procedures adopted by the board of trustees.

Debt securities not traded on a principal securities exchange are valued
through valuations obtained from a commercial pricing service or at the most
recent mean of the bid and asked prices provided by investment dealers in
accordance with procedures established by the board of trustees.

WHERE TO FIND INFORMATION ABOUT SHARE PRICE

The net asset values of the Funds are published in leading newspapers
daily. The net asset values, as well as yield information on all of the Funds
and other funds in the Twentieth Century family of funds, may be obtained by
calling us.

DISTRIBUTIONS

Each Fund declares an ordinary income dividend (and a capital gain
distribution, if necessary) in December. Distributions from net realized
securities gains, if any, generally are declared and paid once a year, but
the Funds may make distributions on a more frequent basis to comply with the
distribution requirements of the Internal Revenue Code, in all events in a
manner consistent with the provisions of the 1940 Act.

Participants in employer-sponsored retirement or savings plans must
reinvest all distributions. For shareholders investing through taxable
accounts, distributions will be reinvested unless you elect to receive them
in cash. Distributions of less than $10 generally will be reinvested.
Distributions made shortly after a purchase by check or ACH may be held up to
15 days. You may elect to have distributions on shares held in Individual
Retirement Accounts and 403(b) plans paid in cash only if you are 591/2 years
old or permanently and totally disabled. Distribution checks normally are
mailed within seven days after the record date. Please consult our Investor
Services Guide for further information regarding your distribution options.

The board of trustees may elect not to distribute capital gains in whole
or in part to take advantage of loss carryovers.

BUYING A DIVIDEND

The timing of your investment could have undesirable tax consequences.
If you open a new account or buy more shares for your current account just
before the day a dividend or distribution is reflected in your Fund's share
price, you will receive a portion of your investment back as a taxable
dividend or distribution.

REVERSE SHARE SPLITS

At the same time that the Funds' annual dividends (and capital gain
distributions, if any) are declared, the board of trustees also declares a
reverse share split for each Fund that exactly offsets the per-share amount
of the Fund's dividends (and capital gain distributions).

Following a reverse share split, shareholders who have chosen to
reinvest dividends and capital gain distributions own exactly the same number
of shares they owned prior to the distribution and reverse share split.
Shareholders who have elected to take distributions in cash own fewer shares.
Reverse share splits cause the Funds' share prices to behave similarly to the
prices of directly held zero-coupon securities with comparable maturity
characteristics. Although the trustees intend to declare a reverse share
split each time a dividend or capital gain distribution is declared, they
reserve the right not to do so.

FUND LIQUIDATION

During a Fund's target maturity year, shareholders will be asked if they
wish to receive payment of the liquidation proceeds in cash or to exchange
their shares for those of another Benham fund or another Fund. If the Trust
has not received instructions by December 31 of the Fund's target maturity
year, shares will be exchanged for shares of Benham Capital Preservation Fund
("CPF") or, if CPF is not available, for shares of another money market fund
in the Twentieth Century family of funds.

TAXES

Each Fund has elected to be taxed as a regulated investment company
under Subchapter M of the Internal Revenue Code, which means that to the
extent its income is distributed to shareholders, it pays no income taxes.

TAX-DEFERRED ACCOUNTS

If the Fund's shares are purchased through tax-deferred accounts, such
as a qualified employer-sponsored retirement or savings plan, income and
capital gains distributions paid by the Fund will generally not be subject to
current taxation, but will accumulate in your account under the plan on a
tax-deferred basis.

Employer-sponsored retirement and savings plans are governed by complex
tax rules. If you elect to participate in your employer's plan, consult your
plan administrator, your plan's summary plan description, or a professional
tax advisor regarding the tax consequences of participation in the plan,
contributions to, and withdrawals or distributions from the plan.

TAXABLE ACCOUNTS

Zero-coupon securities purchased by the Funds accrue interest (commonly
referred to as "imputed income") for federal income tax purposes even though
zeros do not pay current interest. The Funds must distribute this imputed
income to shareholders as ordinary income dividends, which are subject to
federal taxes but exempt from state taxes.

Distributions of net investment income and net short-term capital gains
are taxable to you as ordinary income, except as described below. The
dividends from net income of the fixed income funds do not qualify for the
70% dividends-received deduction for corporations since they are derived from
interest income. Dividends representing income derived from tax-exempt bonds
generally retain the bonds' tax-exempt character in a shareholder's hands.
Distributions from net long-term capital gains are taxable as long-term
capital gains regardless of the length of time you have held the shares on
which such distributions are paid. However, you should note that any loss
realized upon the sale or redemption of shares held for six months or less
will be treated as a long-term capital loss to the extent of any distribution
of long-term capital gain to you with respect to such shares.

Distributions of capital gains are taxable to you regardless of whether
they are taken in cash or reinvested, even if the value of your shares is
below your cost. If you purchase shares shortly before a capital gain
distribution, you must pay income taxes on the distribution, even though the
value of your investment (plus cash received, if any) will not have
increased. In addition, the share price at the time you purchase shares may
include unrealized gains in the securities held in the investment portfolio
of the fund. If these portfolio securities are subsequently sold and the
gains are realized, they will, to the extent not offset by capital losses, be
paid to you as a distribution of capital gains and will be taxable to you as
short-term or long-term capital gains.

In January of the year following the distribution, we or your financial
intermediary will send you a Form 1099-DIV notifying you of the status of
your distributions for federal income tax purposes.

Distributions may also be subject to state and local taxes, even if all
or a substantial part of such distribution are derived from interest on U.S.
government obligations which, if you received them directly, would be exempt
from state income tax. However, most but not all states allow this tax
exemption to pass through to fund shareholders when a fund pays distributions
to its shareholders. You should consult your tax adviser about the tax status
of such distributions in your own state.

If you have not complied with certain provisions of the Internal Revenue
Code and its Regulations, we are required by federal law to

withhold and remit to the IRS 31% of reportable payments (which may include
dividends, capital gains distributions and redemptions). Those regulations
require you to certify that the social security number or tax identification
number you provide is correct and that you are not subject to 31% withholding
for previous under-reporting to the IRS. You will be asked to make the
appropriate certification on your application. PAYMENTS REPORTED BY US THAT
OMIT YOUR SOCIAL SECURITY NUMBER OR TAX IDENTIFICATION NUMBER WILL SUBJECT US
TO A PENALTY OF $50, WHICH WILL BE CHARGED AGAINST YOUR ACCOUNT IF YOU FAIL
TO PROVIDE THE CERTIFICATION BY THE TIME THE REPORT IS FILED, AND IS NOT
REFUNDABLE.

Redemption of shares of a fund (including redemptions made in an
exchange transaction) will be a taxable transaction for federal income tax
purposes and shareholders will generally recognize a gain or loss in an
amount equal to the difference between the basis of the shares and the amount
received. Assuming that shareholders hold such shares as a capital asset, the
gain or loss will be a capital gain or loss and will generally be long term
if shareholders have held such shares for a period of more than one year. If
a loss is realized on the redemption of fund shares, the reinvestment in
additional funds shares within 30 days before or after the redemption may be
subject to the "wash sale" rules of the Internal Revenue Code, resulting in a
postponement of the recognition of such loss for federal income tax purposes.

MANAGEMENT

INVESTMENT MANAGEMENT

The Funds are series of the Benham Target Maturities Trust (the
"Trust"). Under the laws of the Commonwealth of Massachusetts, the board of
trustees is responsible for managing the business and affairs of the Trust.
Acting pursuant to an investment management agreement entered into with the
Trust, Benham Management Corporation (the "Manager") serves as the investment
manager of the Funds. Its principal place of business is 1665 Charleston
Road, Mountain View, California 94043. The Manager has been providing
investments advisory services to investment companies and other clients since
1971.

The Manager supervises and manages the investment portfolio of each of
the Funds and directs the purchase and sale of their investment securities.
The Manager utilizes a team of portfolio managers, assistant portfolio
managers and analysts acting together to manage the assets of the Funds. The
team meets regularly to review portfolio holdings and to discuss purchase and
sale activity. The team adjusts holdings in the Funds' portfolios and the
Funds' asset mix as it deems appropriate in pursuit of the Funds' investment
objectives. Individual portfolio manager members of the team may also adjust
portfolio holdings of the Funds or of sectors of the Funds as necessary
between team meetings.

In June 1995, Twentieth Century Companies, Inc. ("TCC") acquired Benham
Management International, Inc., the then-parent company of the Manager. TCC
is the parent company of Investors Research Corporation ("IRC"), which
provides investment management services to the Twentieth Century family of
funds. In the acquisition, the Manager became a wholly owned subsidiary of
TCC. Certain employees of the Manager provide investment management services
to the Twentieth Century family of funds, while certain Twentieth Century
employees provide investment management services to Benham funds.

The portfolio manager of the team managing the Funds described in this
Prospectus and his work experience for the last five years is as follows:

DAVID SCHROEDER, Vice President, joined the Manager in 1990 and has been
primarily responsible for the day-to-day operations of each of the Funds
since July, 1990, the Benham Treasury Note Fund since January, 1992, and the
Benham Long-Term Treasury and Agency Fund

since September, 1992. Mr. Schroeder has co-managed the Benham GNMA Income
Fund since January, 1996.

The activities of the Manager are subject only to directions of the
Trust's board of trustees. For the services provided to the Funds, the
Manager receives a monthly investment advisory fee equal to its pro rata
share of the dollar amount derived from applying the Trust's average daily
net assets to an investment advisory fee schedule.

The investment advisory fee rate cannot exceed .35% of average daily net
assets, and it drops to a marginal rate of .19% of average daily net assets
as Trust assets increase.

CODE OF ETHICS

The Trust and the Manager have adopted a Code of Ethics, which restricts
personal investing practices by employees of the Manager and its affiliates.
Among other provisions, the Code of Ethics requires that employees with
access to information about the purchase or sale of securities in the Funds'
portfolios obtain preclearance before executing personal trades. With respect
to portfolio managers and other investment personnel, the Code of Ethics
prohibits acquisition of securities in an initial public offering, as well as
profits derived from the purchase and sale of the same security within 60
calendar days. These provisions are designed to ensure that the interests of
the fund shareholders come before the interests of the people who manage
those funds.

TRANSFER AND ADMINISTRATIVE SERVICES

Twentieth Century Services, Inc., 4500 Main Street, Kansas City,
Missouri, 64111, ("TCS") acts as transfer, administrative services and
dividend paying agent for the Funds. TCS provides facilities, equipment and
personnel to the Funds and is paid for such services by the Funds. For
administrative services, each Fund pays TCS a monthly fee equal to its pro
rata share of the dollar amount derived from applying the average daily net
assets of all of the Funds managed by the Manager. The administrative fee
rate ranges from .11% to .08% of average daily net assets, dropping as assets
managed by the Manager increase. For transfer agent services, each Fund pays
TCS a monthly fee for each shareholder account maintained and for each
shareholder transaction executed during that month.

The Funds charge no sales commissions, or "loads," of any kind. However,
investors who do not choose to purchase or sell Fund shares directly from TCS
may purchase or sell Fund shares through registered broker-dealers and other
qualified service providers, who may charge investors fees for their
services. These broker-dealers and service providers generally provide
shareholder, administrative and/or accounting services which would otherwise
be provided by TCS as the Funds' transfer agent. To accommodate these
investors, the Manager and its affiliates have entered into agreements with
some broker-dealers and service providers to provide these services. Fees for
such services are borne normally by the Funds at the rates normally paid to
TCS, which would otherwise provide the services. Any distribution expenses
associated with these arrangements are borne by the Manager.

From time to time, special services may be offered to shareholders who
maintain higher share balances in our family of funds. These services may
include the waiver of minimum investment requirements, expedited confirmation
of shareholder transactions, newsletters and a team of personal
representatives. Any expenses associated with these special services will be
paid by the Manager or its affiliates.

The Manager and TCS are both wholly owned by Twentieth Century
Companies, Inc. James E. Stowers Jr., Chairman of the board of directors of
TCC, controls TCC by virtue of his ownership of a majority of its common
stock.

DISTRIBUTION OF FUND SHARES

The Funds' shares are distributed by Twentieth Century Securities, Inc.
(the "Distributor"), a registered broker-dealer and an affiliate of the
Manager. The Manager pays all expenses for promoting sales of, and
distributing the Fund shares offered by this Prospectus. The Funds do not pay
any commissions or other fees to the Distributor or to any other
broker-dealers or financial intermediaries in connection with the
distribution of Fund shares.

EXPENSES

Each Fund pays certain operating expenses directly, including, but not
limited to: custodian, audit, and legal fees; fees of the independent
directors or trustees; costs of printing and mailing prospectuses, statements
of additional information, proxy statements, notices, and reports to
shareholders; insurance expenses; and costs of registering the Fund's shares
for sale under federal and state securities laws. See the Statements of
Additional Information for a more detailed discussion of independent trustee
compensation.

FURTHER INFORMATION ABOUT THE FUNDS

The Trust was organized as a Massachusetts business trust on November 8,
1984. The Trust is a diversified, open-end management investment company and
currently consists of six series. Its business and affairs are managed by its
officers under the direction of its board of trustees.

The principal office of the Trust is Twentieth Century Tower, 4500 Main
Street, P. O. Box 419200, Kansas City, Missouri 64141-6200. All inquiries may
be made by mail to that address, or by phone to 1-800-345-2021. (For
international callers: 816-531-5575.)

The Funds are individual series of the Trust which issues shares with no
par value. Each series is commonly referred to as a fund. The assets
belonging to each series of shares are held separately by the custodian and
in effect each series is a separate fund.

Each share, irrespective of series, is entitled to one vote for each
dollar of net asset value applicable to such share on all questions, except
those matters which must be voted on separately by the series of shares
affected. Matters affecting only one Fund are voted upon only by that Fund.

Shares have non-cumulative voting rights, which means that the holders
of more than 50% of the shares voting for the election of trustees can elect
all of the trustees if they choose to do so, and in such event the holders of
the remaining less-than 50% of the shares will not be able to elect any
person or persons to the board of trustees.

Unless required by the 1940 Act, it will not be necessary for the Trust
to hold annual meetings of shareholders. As a result, shareholders may not
vote each year on the election of trustees or the appointment of auditors.
However, pursuant to the Trust's by-laws, the holders of shares representing
at least 10% of the votes entitled to be cast may request that the Trust hold
a special meeting of shareholders. We will assist in the communication with
other shareholders.

WE RESERVE THE RIGHT TO CHANGE ANY OF OUR POLICIES, PRACTICES AND
PROCEDURES DESCRIBED IN THIS PROSPECTUS, INCLUDING THE STATEMENT OF
ADDITIONAL INFORMATION, WITHOUT SHAREHOLDER APPROVAL EXCEPT IN THOSE
INSTANCES WHERE SHAREHOLDER APPROVAL IS EXPRESSLY REQUIRED.

THIS PROSPECTUS CONSTITUTES AN OFFER TO SELL SECURITIES OF A FUND ONLY
IN THOSE STATES WHERE THE FUND'S SHARES HAVE BEEN REGISTERED OR OTHERWISE
QUALIFIED FOR SALE. A FUND WILL NOT ACCEPT APPLICATIONS FROM PERSONS RESIDING
IN STATES WHERE THE FUND'S SHARES ARE NOT REGISTERED.

BENHAM
Target Maturities Trust

Prospectus
September 3, 1996

TWENTIETH CENTURY MUTUAL FUNDS
and THE BENHAM GROUP
- --------------------------------------------

P.O. Box 419200
Kansas City, Missouri
64141-6200
- --------------------------------------------
Person-to-person assistance:
1-800-345-2021 or 816-531-5575
- --------------------------------------------
Automated Information Line:
1-800-345-8765
- --------------------------------------------
Telecommunications Device for the Deaf:
1-800-634-4113 or 816-753-1865
- --------------------------------------------
Fax: 816-340-7962
- --------------------------------------------
Internet: http://www.twentieth-century.com
- --------------------------------------------
BENHAM
TARGET MATURITIES TRUST
- --------------------------------------------------------------------------------
BN-BKT-5489 [recycled logo]
9608 Recycled

<PAGE>
BENHAM TARGET MATURITIES TRUST

2000 PORTFOLIO
2005 PORTFOLIO
2010 PORTFOLIO
2015 PORTFOLIO
2020 PORTFOLIO
2025 PORTFOLIO

4500 Main Street
Kansas City, MO 64111

Person-to-Person Assistance: 1-800-345-2021 or 816-531-5575
Automated: 1-800-345-8765

STATEMENT OF ADDITIONAL INFORMATION

September 3, 1996

This Statement is not a prospectus, but should be read in conjunction with the
Trust's current Prospectus dated September 3, 1996. The Trust's Annual Report
for the fiscal year ended September 30, 1995 and Semiannual Report for the
period ended March 31, 1996 are incorporated herein by reference. To obtain a
copy of the Prospectus, Annual Report or Semiannual Report, call or write
Twentieth Century Mutual Funds.

TABLE OF CONTENTS

Page

Investment Policies and Techniques 2
Investment Restrictions 2
Portfolio Transactions 4
Valuation of Portfolio Securities 5
Predictability of Return 6
Performance 8
Taxes 10
About the Trust 11
Trustees and Officers 12
Investment Advisory Services 15
Transfer and Administrative Services 16
Direct Portfolio Expenses 17
Expense Limitation Agreement 17
Additional Purchase and Redemption Information 18
Other Information 19

INVESTMENT POLICIES AND TECHNIQUES

The following paragraphs provide a more detailed description of the securities
and investment practices identified in the Prospectus. Unless otherwise noted,
the policies described in this Statement of Additional Information are not
fundamental and may be changed by the board of trustees.

LOANS OF PORTFOLIO SECURITIES

Each Portfolio may lend its portfolio securities to earn additional income. If a
borrower defaults on a securities loan, the lending Portfolio could experience
delays in recovering the securities it loaned; if the value of the loaned
securities increased in the meantime, the Portfolio could suffer a loss. To
minimize the risk of default on securities loans, Benham Management Corporation
(BMC) adheres to the following guidelines established by the board of trustees:

TYPE AND AMOUNT OF COLLATERAL. At the time a loan is made, the Portfolio must
receive, from or on behalf of a borrower, collateral consisting of any
combination of cash and full faith and credit U.S. government securities equal
to not less than 102% of the market value of the securities loaned. Cash
collateral received by a Portfolio in connection with loans of portfolio
securities may be commingled by the Portfolio's custodian with other cash and
marketable securities, provided that the loan agreement expressly allows such
commingling.

ADDITIONS TO COLLATERAL. Collateral must be marked to market daily, and the
borrower must agree to add to collateral to the extent necessary to maintain the
102% level specified in guideline (1) above. The borrower must deposit
additional collateral not later than the business day following the business day
on which a collateral deficiency occurs or collateral appears to be inadequate.

TERMINATION OF LOAN. The Portfolio must have the ability to terminate a loan of
portfolio securities at any time. The borrower must be obligated to redeliver
the borrowed securities within the normal settlement period following receipt of
the termination notice. The normal settlement period for U.S. government
securities is two trading days.

REASONABLE RETURN ON LOAN. The borrower must agree that the Portfolio (a) will
receive all dividends, interest, or other distributions on loaned securities and
(b) will be paid a reasonable return on such loans either in the form of a loan
fee or premium or from the retention by the Portfolio of part or all of the
earnings and profits realized from the investment of cash collateral in full
faith and credit U.S. government securities.

LIMITATIONS ON PERCENTAGE OF PORTFOLIO ASSETS ON LOAN. A Portfolio's loans may
not exceed 33 % of its total assets.

CREDIT ANALYSIS. As part of the regular monitoring procedures it follows to
evaluate banks and broker-dealers in connection with, for example, repurchase
agreements and municipal securities credit issues, BMC, the Portfolios'
investment advisor, analyzes and monitors the creditworthiness of all borrowers
with whom securities lending agreements are contemplated or entered into.

INVESTMENT RESTRICTIONS

The Portfolios' investment restrictions set forth below are fundamental and may
not be changed without approval of a majority of the outstanding votes of
shareholders of the Portfolio as determined in accordance with the Investment
Company Act of 1940 (the "1940 Act").

EACH PORTFOLIO MAY NOT:

(1) Purchase the securities of any issuer (other than obligations issued or
guaranteed by the U.S. government, its agencies or instrumentalities) if,
as a result, (a) more than 5% of the value of its total assets would be
invested in the securities of that issuer, or (b) the Portfolio would hold
more than 10% of the outstanding voting securities of that issuer.

(2) Purchase the securities of any issuer (other than obligations issued or
guaranteed by the U.S. government, its agencies or instrumentalities) if,
as a result, 25% or more of the value of its total assets would be invested
in securities of issuers having their principal business activities in the
same industry.

(3) Purchase the securities of any issuer (other than obligations issued or
guaranteed by the U.S. government, its agencies or instrumentalities) if,
as a result, more than 5% of the value of its total assets would be
invested in the securities (taken at cost) of issuers which, at the time of
purchase, had been in operation less than three years, including
predecessors and unconditional guarantors.

(4) Purchase any equity securities in any companies, including warrants or
bonds with warrants attached, or any preferred stocks, convertible bonds,
or convertible debentures.

(5) Engage in transactions involving puts, calls, straddles, or spreads.

(6) Invest in securities that are not readily marketable or the disposition of
which is restricted under federal securities laws (collectively, "illiquid
securities") if, as a result, more than 10% of the Portfolio's net assets
would be invested in illiquid securities.

(7) Acquire or retain the securities of any other investment company if, as a
result, more than 3% of such investment company's outstanding shares would
be held by the Trust, more than 5% of the value of the Trust's assets would
be invested in shares of such investment company, or more than 10% of the
value of the Trust's assets would be invested in shares of investment
companies in the aggregate, except in connection with a merger,
consolidation, acquisition, or reorganization.

(8) Purchase or retain securities of any issuer if, to the knowledge of the
Trust's management, those officers and trustees of the Trust and of its
investment advisor, who each own beneficially more than 0.5% of the
outstanding securities of such issuer, together own beneficially more than
5% of such securities.

(9) Acquire securities for the purpose of exercising control over management
of the issuer.

(10) Issue or sell any class of senior security as defined in the Investment
Company Act of 1940.

(11) Purchase, sell, or invest in real estate, commodities, commodity contracts,
foreign exchange, or interests in oil, gas, or other mineral exploration or
development programs.

(12) Portfolio may not engage in any short-selling operations.

(13) Purchase securities on margin, except for such short-term credits as are
necessary for the clearance of purchases of portfolio securities.

(14) Act as an underwriter of securities issued by others, except to the extent
that the purchase of portfolio securities may be deemed to be an
underwriting.

(15) Borrow money in excess of 33 % of the market value of its total assets, and
then only from a bank and as a temporary measure to satisfy redemption
requests or for extraordinary or emergency purposes, and provided that
immediately after any such borrowing there is an asset coverage of at least
300 per centum for all such borrowings. To secure any such borrowing, a
Portfolio may not mortgage, pledge, or hypothecate in excess of 33 % of the
value of its total assets. A Portfolio will not purchase any security while
borrowings representing more than 5% of its total assets are outstanding. A
Portfolio will not borrow in order to increase income (leverage), but only
to facilitate redemption requests that might require untimely disposition
of portfolio securities.

(16) Make loans to others, except for the lending of portfolio securities
pursuant to guidelines established by the board of trustees or for the
purchase of debt securities in accordance with its investment objectives
and policies.

Unless otherwise indicated, percentage limitations included in the restrictions
apply at the time the transactions are entered into. Accordingly, any later
increase or decrease beyond the specified limitation resulting from a change in
the Portfolio's net assets will not be considered in determining whether it has
complied with these investment restrictions.

PORTFOLIO TRANSACTIONS

Each Portfolio's assets are invested by BMC in a manner consistent with the
Portfolio's investment objective, policies and restrictions, and with any
instructions that the board of trustees may issue from time to time. Within this
framework, BMC is responsible for making all determinations as to the purchase
and sale of portfolio securities and for taking all steps necessary to implement
securities transactions on behalf of the Portfolios. In placing orders for the
purchase and sale of portfolio securities, BMC will use its best possible price
and execution and will otherwise place orders with broker-dealers subject to and
in accordance with any instructions that the board of trustees may issue from
time to time. BMC will select broker-dealers to execute portfolio transactions
on behalf of the Portfolios solely on the basis of best price and execution.

U.S. government securities generally are traded in the over-the-counter (OTC)
market through broker-dealers. A broker-dealer is a securities firm or bank that
makes a market for securities by offering to buy at one price and sell at a
slightly higher price. The difference between these prices is known as a spread.

BMC expects to execute most transactions on a net basis through broker-dealers
unless it is determined that a better price or execution can be obtained on a
commission basis through a broker. Portfolio securities may also be purchased
directly from the issuer. The Portfolios paid no brokerage commissions during
the fiscal years ended September 30, 1995, 1994 and 1993.

Each Portfolio may hold portfolio securities until they mature, or it may sell
or otherwise dispose of these securities, replacing them with other securities
consistent with its investment objective and policies. The Portfolios' turnover
rates for the fiscal years ended September 30, 1995 and 1994, are indicated in
the following table.

PORTFOLIO TURNOVER RATES
FISCAL FISCAL
PORTFOLIO 1995 1994

2000 Portfolio 52.64% 89.35%
2005 Portfolio 34.23 68.11
2010 Portfolio 26.00 35.35
2015 Portfolio 69.97 64.90
2020 Portfolio 78.08 116.46
2025 Portfolio 30.53 --

VALUATION OF PORTFOLIO SECURITIES

Each Fund's net asset value per share ("NAV") is calculated by Twentieth Century
Services, Inc. (TCS), as of the close of business of the New York Stock Exchange
(the "Exchange") each day the Exchange is open for business, usually at 3:00
p.m. Central Time. The Exchange has designated the following holiday closings
for 1996: New Year's Day (observed), Presidents` Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day, and Christmas Day (observed).
Although TCS expects the same holiday schedule to be observed in the future, the
Exchange may modify its holiday schedule at any time.

BMC typically completes its trading on behalf of each Portfolio in various
markets before the Exchange closes for the day.

Each Portfolio's share price is calculated by adding the value of all portfolio
securities and other assets, deducting liabilities, and dividing the result by
the number of shares outstanding. Expenses and interest on portfolio securities
are accrued daily.

Most securities held by the Portfolios are priced at market value using prices
obtained from an independent pricing service. Because of the large number of
zero-coupon Treasury obligations available, many do not trade each day. In
valuing these securities, the pricing service generally takes into account
institutional trading, trading in similar groups of securities, and any
developments related to specific securities.

The methods used by the pricing service and the valuations so established are
reviewed by BMC under the general supervision of the board of trustees. There
are a number of pricing services available. BMC, on the basis of ongoing
evaluation of these services, may use other pricing services or discontinue the
use of any pricing service in whole or in part.

Securities maturing within 60 days of the valuation date may be valued at
amortized cost, which is cost plus or minus any amortized discount or premium,
unless the trustees determine that this would not result in fair valuation of a
given security. Other assets and securities for which quotations are not readily
available are valued in good faith at their fair market value using methods
approved by the board of trustees.

PREDICTABILITY OF RETURN

ANTICIPATED VALUE AT MATURITY. The maturity values of zero-coupon bonds are
specified at the time the bonds are issued, and this feature, combined with the
ability to calculate yield to maturity, has made these instruments popular
investment vehicles for investors seeking reliable investments to meet long-term
financial goals.

To provide a comparable investment opportunity while allowing investors the
flexibility to purchase or redeem shares each day the Trust is open for
business, each Portfolio consists primarily of zero-coupon bonds but is actively
managed to accommodate shareholder activity and to take advantage of perceived
market opportunities. Because of this active management approach, BMC does not
guarantee that a certain price per share will be attained by the time a
Portfolio is liquidated. Instead, BMC attempts to track the price behavior of a
directly held zero-coupon bond by

(1) Maintaining a weighted average maturity within the Portfolio's target
maturity year;

(2) Investing at least 90% of assets in securities that mature within one year
of the Portfolio's target maturity year;

(3) Investing a substantial portion of assets in Treasury STRIPS (the most
liquid Treasury zero);

(4) Under normal conditions, maintaining a cash balance of less than 1%;

(5) Executing portfolio transactions necessary to accommodate net shareholder
purchases or redemptions on a daily basis; and

(6) Whenever feasible, contacting several U.S. government securities dealers
for each intended transaction in an effort to obtain the best price on each
transaction.

These measures enable the advisor to calculate an anticipated value at maturity
(AVM) for each Portfolio that approximates the price per share the Portfolio
will achieve by its weighted average maturity date. The AVM calculation is as
follows:

AVM = P(1+AGR/2)2T

where P = the Portfolio's current price per share; T = the Portfolio's weighted
average term to maturity in years; and AGR = the anticipated growth rate.

This calculation assumes that the shareholder will reinvest all dividend and
capital gain distributions (if any). It also assumes an expense ratio and a
portfolio composition that remain constant for the life of the Portfolio.
Because Portfolio expenses and composition do not remain constant, however, BMC
calculates AVM for each Portfolio each day the Trust is open for business.

In addition to the measures described above, which BMC believes are adequate to
assure close correspondence between the price behavior of each Portfolio and the
price behavior of directly held zero-coupon bonds with comparable maturities,
the Trust has made an undertaking to the staff of the Securities and Exchange
Commission (SEC) that each Portfolio will invest at least 90% of its net assets
in zero-coupon bonds until it is within four years of its target maturity year
and at least 80%

of its net assets in zero-coupon securities while the Portfolio is within two to
four years of its target maturity year. This undertaking may be revoked if the
market supply of zero-coupon securities diminishes unexpectedly, although it
will not be revoked without prior consultation with the SEC staff. In addition,
BMC has undertaken that any coupon-bearing bond purchased on behalf of a
Portfolio will have a duration that falls within the Portfolio's target maturity
year.

ANTICIPATED GROWTH RATE. BMC also calculates an anticipated growth rate (AGR)
for each Portfolio each day the Trust is open for business. AGR is a calculation
of the annualized rate of growth an investor may expect from his or her purchase
date to the Portfolio's target maturity date. As is the case with calculations
of AVM, the AGR calculation assumes that the investor will reinvest all
dividends and capital gain distributions (if any) and that the Portfolio's
expense ratio and portfolio composition will remain constant. Each Portfolio's
AGR changes from day to day primarily because of changes in interest rates and,
to a lesser extent, to changes in portfolio composition and other factors that
affect the value of the Portfolio's investments.

BMC expects that shareholders who hold their shares until a Portfolio's weighted
average maturity date and who reinvest all dividends and capital gain
distributions (if any), will realize an investment return and maturity value
that do not differ substantially from the AGR and AVM calculated on the day his
or her shares were purchased.

The following table illustrates investor experience with the 1990 Portfolio, a
series of the Trust that was first offered on March 25, 1985, and that was
liquidated on January 25, 1991. This table is not indicative of the future
performance of the existing Portfolios.

DATE SHARE PRICE (P) AGR WEIGHTED AVERAGE AVM
(in $) MATURITY (T) (in $)

April 1985 56.03 10.58 5.64 100.25
June 60.62 9.68 5.42 101.17
September 62.72 9.44 5.08 100.23
December 67.75 8.26 4.95 101.15
March 1986 73.60 6.86 4.69 100.98
June 74.80 6.83 4.38 100.38
September 76.82 6.59 4.16 100.63
December 79.01 6.27 3.86 100.26
March 1987 79.88 6.34 3.59 99.93
June 79.01 7.21 3.27 99.63
September 77.28 8.57 3.14 100.62
December 81.02 7.52 2.7 99.33
March 1988 83.61 6.98 2.51 99.33
June 83.97 6.55 2.62 99.42
September 84.96 6.97 2.09 98.04
December 85.70 8.39 1.68 98.38
March 1989 86.76 9.18 1.50 99.25
June 90.47 7.57 1.23 99.16
September 91.91 7.81 0.98 99.08
December 94.00 7.38 0.74 99.17

DATE SHARE PRICE (P) AGR WEIGHTED AVERAGE AVM
(in $) MATURITY (T) (in $)

March 1990 95.62 7.68 0.52 99.44
June 97.48 7.44 0.32 99.82
September 99.32 6.73 0.15 100.31
December 101.13 4.33 0.07 101.43

Calculations in the table on the previous page may not reconcile precisely due
to rounding of share price, AGR, and weighted average maturity to two decimal
points.

Note that the 1990 Portfolio's share price on December 31, 1990, was not the
same as its AVM on that date because the Portfolio had not yet been liquidated
and still held short-term Treasury securities with a 25-day maturity. The
Portfolio was liquidated on January 25, 1991, at a final share price of $101.46.

As a further demonstration of how the Portfolios have behaved over time, the
following table shows each Portfolio's AGR and AVM as of September 30 for each
of the past five years.
<TABLE>
<CAPTION>
9/30/91 9/30/92 9/30/93 9/30/94 9/30/95
AGR AVM AGR AVM AGR AVM AGR AVM AGR AVM
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
2000 Portfolio 7.14% $ 98.28 6.01% $101.01 4.66% $100.21 6.76% $100.86 5.37% $100.99
2005 Portfolio 7.49 98.72 6.89 99.78 5.53 100.21 7.33 100.58 5.75 100.32
2010 Portfolio 7.56 98.54 7.21 100.11 5.92 100.94 7.54 101.38 6.04 101.02
2015 Portfolio 7.52 105.13 7.43 107.05 6.04 106.84 7.56 107.95 6.21 109.62
2020 Portfolio 7.34 94.04 7.37 101.87 6.02 100.76 7.52 102.11 6.20 102.31
</TABLE>

The Portfolios' share prices and growth rates are not guaranteed by the Trust or
any of its affiliates. There is no guarantee that the Portfolios' AVMs will
fluctuate as little in the future as they have in the past.

PERFORMANCE

The Portfolios yields and total returns may be quoted in advertising and sales
literature. These figures, as well as the Portfolio`s share price will vary.
Past performance should not be considered as indicative of future results.

Yield quotations are based on the investment income per share earned during a
particular 30-day period, less expenses accrued during the period (net
investment income), and are computed by dividing a Portfolio's net investment
income by its share price on the last day of the period, according to the
following formula:
6
YIELD = 2 [(a - b + 1) - 1]
-----
cd

where a = dividends and interest earned during the period, b = expenses accrued
for the period (net of reimbursements), c = the average daily number of shares
outstanding during the period that were entitled to receive dividends, and d =
the maximum offering price per share on the last day of the period.

Each Portfolio's yield for the 30-day period ended June 30, 1996, calculated
using the SEC yield formula described above, is indicated below.

30-DAY YIELD
PORTFOLIO (THROUGH 6/30/96)

2000 Portfolio 5.50%
2005 Portfolio 6.09
2010 Portfolio 6.32
2015 Portfolio 6.55
2020 Portfolio 6.73
2025 Portfolio 6.40

Total returns quoted in advertising and sales literature reflect all aspects of
a Portfolio's return, including the effect of reinvesting dividends and capital
gain distributions and any change in the Portfolio's NAV during the period.

Average annual total returns are calculated by determining the growth or decline
in value of a hypothetical historical investment in a Portfolio over a stated
period and then calculating the annually compounded percentage rate that would
have produced the same result if the rate of growth or decline in value had been
constant throughout the period. For example, a cumulative return of 100% over
ten years would produce an average annual return of 7.18%, which is the steady
annual rate that would result in 100% growth on a compounded basis in ten years.
While average annual total returns are a convenient means of comparing
investment alternatives, investors should realize that a Portfolio's performance
is not constant over time but changes from year to year and that average annual
total returns represent averaged figures as opposed to actual year-to-year
performance.

The Portfolios' average annual total returns for the one-year, five-year,
ten-year, and life-of-portfolio periods ended June 30, 1996, are indicated in
the following table.

AVERAGE ANNUAL TOTAL RETURNS

PORTFOLIO ONE-YEAR FIVE-YEAR TEN-YEAR LIFE-OF-PORTFOLIO*

2000 Portfolio 11.69% 10.36% 8.80% 13.50%
2005 Portfolio 15.94 12.56 9.57 15.34
2010 Portfolio 19.11 13.32 9.43 16.50
2015 Portfolio 21.29 13.97 N/A 10.14
2020 Portfolio 23.53 13.43 N/A 10.09

* The 2000, 2005, and 2010 Portfolios commenced operations on March 25, 1985.
The 2015 Portfolio commenced operations on September 1, 1986. The 2020 Portfolio
commenced operations on December 29, 1989. The 2025 Portfolio commenced
operations on February 16, 1996. The cumulative return since inception through
June 30, 1996 is (10.18%).

In addition to average annual total returns, each Portfolio may quote unaveraged
or cumulative total returns reflecting the simple change in value of an
investment over a stated period. Average annual and cumulative total returns may
be quoted as percentages or as dollar amounts and may be calculated for a single
investment, a series of investments, or a series of redemptions over any time
period. Total returns may be broken down into their components of income and
capital (including

capital gains and changes in share price) in order to illustrate the
relationship of these factors and their contributions to total return.

The Portfolios' performances may be compared with the performance of other
mutual funds tracked by mutual fund rating services or with other indexes of
market performance. This may include comparisons with funds that, unlike the
Twentieth Century family of funds, are sold with a sales charge or deferred
sales charge. Sources of economic data that may be considered in making such
comparisons may include, but are not limited to, U.S. Treasury bill, note, and
bond yields, money market fund yields, U.S. government debt and percentage held
by foreigners, the U.S. money supply, net free reserves, and yields on
current-coupon GNMAs (source: Board of Governors of the Federal Reserve System);
the federal funds and discount rates (source: Federal Reserve Bank of New York);
yield curves for U.S. Treasury securities and AA/AAA-rated corporate securities
(source: Bloomberg Financial Markets); yield curves for AAA-rated tax-free
municipal securities (source: Telerate); yield curves for foreign government
securities (sources: Bloomberg Financial Markets and Data Resources, Inc.);
total returns on foreign bonds (source: J.P. Morgan Securities Inc.); various
U.S. and foreign government reports; the junk bond market (source: Data
Resources, Inc.); the CRB Futures Index (source: Commodity Index Report); the
price of gold (sources: London a.m./p.m. fixing and New York Comex Spot Price);
rankings of any mutual fund or mutual fund category tracked by Lipper Analytical
Services, Inc. or Morningstar, Inc.; mutual fund rankings published in major,
nationally distributed periodicals; data provided by the Investment Company
Institute; Ibbotson Associates, Stocks, Bonds, Bills, and Inflation; major
indexes of stock market performance; and indexes and historical data supplied by
major securities brokerage or investment advisory firms. The Portfolios may also
utilize reprints from newspapers and magazines furnished by third parties to
illustrate the Portfolios' historical performances.

The Portfolios' shares are sold without a sales charge (or "load"). No-load
funds offer an advantage to investors when compared to load funds with
comparable investment objectives and strategies. For example, if you invest
$10,000 in a no-load fund, 100% of your investment is used to buy shares. If you
invest $10,000 in a fund with a 5.5% load, only $9,450 ($10,000 minus $550) is
used to buy shares. Over time, this difference can have a significant effect on
total return. Assuming a compounded annual growth rate of 10% for both
investments, the no-load fund investment would be worth $25,937 after ten years,
while the load fund investment would be worth only $24,511.

TAXES

Each Portfolio intends to qualify annually as a "regulated investment company"
under Subchapter M of the Internal Revenue Code (the "Code"). By so qualifying,
each Portfolio will be exempt from federal and California income taxes to the
extent that it distributes substantially all of its net investment income and
net realized capital gains to shareholders.

As holders of zero-coupon Treasury securities ("zeros"), the Portfolios receive
no cash payments of interest prior to the dates these securities mature.
However, portfolio holdings that include zeros accrue interest (commonly
referred to as "imputed income") for federal income tax purposes.

Under the Code, dividends derived from interest, imputed income, and any
short-term capital gains are federally taxable to shareholders as ordinary
income, regardless of whether such dividends are taken in cash or reinvested in
additional shares. Distributions designated as being made from a Portfolio's net
realized long-term capital gains are taxable to shareholders as long-term
capital gains, regardless of the length of time shares are held. Corporate
investors are not eligible for the dividends-received deduction with respect to
distributions from the Portfolios.

Upon redeeming, selling, or exchanging shares of a Portfolio, shareholders will
realize a taxable gain or loss depending upon their basis in the shares
liquidated. The gain or loss generally will be long-term or short-term depending
on the length of time the shares were held. However, a loss recognized by a
shareholder in the disposition of shares on which capital gain dividends were
paid (or deemed paid) before the shareholder had held his or her shares for more
than six months would be treated as a long-term capital loss for tax purposes.

Dividends paid by each Portfolio are exempt from state personal income taxes in
all states because the Portfolios derive their income from debt securities of
the U.S. government whose interest payments are state tax-exempt. Distributions
of capital gains are generally not exempt from state and local taxes.

The information above is only a summary of some of the tax considerations
generally affecting the Portfolios and their shareholders; no attempt has been
made to discuss individual tax consequences. A prospective investor should
consult his or her tax advisor or state or local tax authorities to determine
whether the Portfolios are suitable investments based on his or her tax
situation.

ABOUT THE TRUST

Benham Target Maturities Trust (the "Trust") was organized as a Massachusetts
business trust on November 8, 1984. The Declaration of Trust permits the
trustees to issue an unlimited number of full and fractional shares of
beneficial interest without par value, which may be issued in series
(Portfolios). Currently, there are six series of the Trust, as follows: 2000
Portfolio, 2005 Portfolio, 2010 Portfolio, 2015 Portfolio, 2020 Portfolio and
2025 Portfolio. The board of trustees may create additional series from time to
time. In addition, the board of trustees may liquidate a series at the
conclusion of its target maturity year.

Shares of each Portfolio have equal voting rights, although each Portfolio votes
separately on matters affecting it exclusively. Voting rights are not
cumulative; investors holding more than 50% of the Trust's (i.e., all
Portfolios') outstanding shares may elect a board of trustees. The Trust has
instituted dollar-based voting, meaning that the number of votes you are
entitled to is based upon the dollar amount of the their investment. The
election of trustees is determined by the votes received from all Trust
shareholders without regard to whether a majority of shares of any one series
voted in favor of a particular nominee or all nominees as a group. Each
shareholder has rights to dividends and distributions declared by a Portfolio
and to the net assets of such Portfolio upon its liquidation or dissolution
proportionate to his or her share ownership interest in the Portfolio.

The shareholders of a Massachusetts business trust could, under certain
circumstances, be held personally liable for its obligations. However, the
Declaration of Trust contains an express disclaimer of shareholder liability for
acts or obligations of the Trust. The Declaration of Trust also provides for
indemnification and reimbursement of expenses of any shareholder held personally
liable for obligations of the Trust. The Declaration of Trust provides that the
Trust will, upon request, assume the defense of any claim made against any
shareholder for any act or obligation of the Trust and satisfy any judgment
thereon. The Declaration of Trust further provides that the Trust may maintain
appropriate insurance (for example, fidelity, bonding, and errors and omissions
insurance) for the protection of the Trust, its shareholders, trustees,
officers, employees, and agents to cover possible tort and other liabilities.
Thus, the likelihood that a shareholder would incur financial loss on account of
shareholder liability is limited to circumstances in which both inadequate
insurance exists and the Trust itself is unable to meet its obligations.

CUSTODIAN BANK: State Street Bank and Trust Company, 225 Franklin Street,
Boston, Massachusetts 02101, is custodian of the Trust's assets. Services
provided by the custodian bank include (a) settling portfolio purchases and
sales, (b) reporting failed trades, (c) identifying and collecting portfolio
income, and (d) providing safekeeping of securities. The custodian takes no part
in determining the Fund's investment policies or in determining which securities
are sold or purchased by the Fund. Effective October 7, 1996, Chase Manhattan
Bank, 4 Chase Metrotech Center, Brooklyn, NY 11245 will provide the custodian
services for the Fund.

INDEPENDENT AUDITORS: KPMG Peat Marwick LLP, 1000 Walnut, Suite 1600, Kansas
City, Missouri 64106, serves as the Trust's independent auditors. KPMG audits
the annual report and provides tax and other services.

TRUSTEES AND OFFICERS

The Trust's activities are overseen by a board of trustees, including seven
independent trustees. The individuals listed below whose names are marked by an
asterisk (*) are "interested persons" of the Trust (as defined in the Investment
Company Act of 1940) by virtue of, among other considerations, their affiliation
with either the Trust; the Trust's investment advisor, Benham Management
Corporation (BMC); the Trust's agent for transfer and administrative services,
Twentieth Century Services, Inc. (TCS); the Trust's distribution agent,
Twentieth Century Securities, Inc.; the parent corporation, Twentieth Century
Companies, Inc. (TCC) or TCC's subsidiaries; or other funds advised by BMC. The
trustees listed below serve as trustees or directors of other funds managed by
BMC. Unless otherwise noted, a date in parentheses indicates the date the
trustee or officer began his or her service in a particular capacity. The
trustees' and officers' address with the exception of Mr. Stowers III and Ms.
Roepke is 1665 Charleston Road, Mountain View, California 94043. The address of
Mr. Stowers III and Ms. Roepke is 4500 Main Street, Kansas City, Missouri 64111.

TRUSTEES

*JAMES M. BENHAM, chairman of the board of trustees (1985), president and chief
executive officer (1996). Mr. Benham is also chairman of the boards of Benham
Financial Services, Inc. (BFS) (1985), BMC (1971), and Benham Distributors, Inc.
(BDI) (1988); president of BMC (1971), and BDI (1988); and a member of the board
of governors of the Investment Company Institute (1988). Mr. Benham has been in
the securities business since 1963, and he frequently comments through the media
on economic conditions, investment strategies, and the securities markets.

ALBERT A. EISENSTAT, independent trustee (1995). Mr. Eisenstat is an independent
director of each of Commercial Metals Co. (1982), Sungard Data Systems (1991)
and Business Objects S/A (1994). Previously, he served as vice president of
corporate development and corporate secretary of Apple Computer and served on
its Board of Directors (1985 to 1993).

RONALD J. GILSON, independent trustee (1995); Charles J. Meyers Professor of Law
and Business at Stanford Law School (1979) and the Mark and Eva Stern Professor
of Law and Business at Columbia University School of Law (1992); counsel to
Marron, Reid & Sheehy (a San Francisco law firm, 1984).

MYRON S. SCHOLES, independent trustee (1985). Mr. Scholes is a principal of
Long-Term Capital Management (1993). He is also Frank E. Buck Professor of
Finance at the Stanford Graduate School of Business (1983) and a director of
Dimensional Fund Advisors (1982) and the Smith Breeden

Family of Funds (1992). From August 1991 to June 1993, Mr. Scholes was a
managing director of Salomon Brothers Inc. (securities brokerage).

KENNETH E. SCOTT, independent trustee (1985). Mr. Scott is Ralph M. Parsons
Professor of Law and Business at Stanford Law School (1972) and a director of
RCM Capital Funds, Inc. (June 1994).

EZRA SOLOMON, independent trustee (1985). Mr. Solomon is Dean Witter Professor
of Finance Emeritus at the Stanford Graduate School of Business, where he served
as Dean Witter Professor of Finance from 1965 to 1990, and a director of
Encyclopedia Britannica.

ISAAC STEIN, independent trustee (1992). Mr. Stein is former chairman of the
board (1990 to 1992) and chief executive officer (1991 to 1992) of Esprit de
Corp. (clothing manufacturer). He is a member of the board of Raychem
Corporation (electrical equipment, 1993), president of Waverley Associates, Inc.
(private investment firm, 1983), and a director of ALZA Corporation
(pharmaceuticals, 1987). He is also a trustee of Stanford University (1994) and
chairman of Stanford Health Services (hospital, 1994).

*JAMES E. STOWERS III, trustee (1995). Mr. Stowers III is president and director
of Twentieth Century Investors, Inc., TCI Portfolios, Inc., Twentieth Century
World Investors, Inc., Twentieth Century Premium Reserves, Inc., Twentieth
Century Capital Portfolios, Inc., Twentieth Century Companies, Inc., Investors
Research Corporation and Twentieth Century Services, Inc.

JEANNE D. WOHLERS, independent trustee (1985). Ms. Wohlers is a private investor
and an independent director and partner of Windy Hill Productions, LP.
Previously, she served as vice president and chief financial officer of Sybase,
Inc. (software company, 1988 to 1992).

OFFICERS

*JAMES M. BENHAM, president and chief executive officer (1996).

*DOUGLAS A. PAUL, secretary (1988), vice president (1990), and general counsel
(1990); secretary, vice president and general counsel of BMC, BFS, BDI and all
of the funds in the Benham Group.

*ANN N. McCOID, CPA, controller (1987); controller of BFS and all of the funds
in the Benham Group.

*MARYANNE ROEPKE, CPA, chief financial officer and treasurer (1995); vice
president, treasurer and principal accounting officer, Twentieth Century
Strategic Asset Allocations; vice president and treasurer, Twentieth Century
Investors, Inc., Twentieth Century World Investors, Inc., Twentieth Century
Capital Portfolios, Inc., Twentieth Century Premium Reserves, Inc. and TCI
Portfolios, Inc.; vice president, Twentieth Century Services, Inc.

As of July 31, 1996, the Trust's officers and trustees, as a group, owned less
than 1% of each Portfolio's total shares outstanding.

The table on the next page summarizes the compensation that the trustees of the
Funds received for the Portfolio's fiscal year ended September 30, 1995, as well
as the compensation received for serving as a director or trustee of all other
funds managed by BMC.

<TABLE>
<CAPTION>
TRUSTEE COMPENSATION FOR THE FISCAL YEAR ENDED
September 30, 1995
- ---------------------------------------------------------------------------------------------------------------------------
NAME OF AGGREGATE PENSION OR ESTIMATED TOTAL
TRUSTEE* COMPENSATION RETIREMENT BENEFITS ANNUAL BENEFITS COMPENSATION
FROM ACCRUED AS PART OF UPON RETIREMENT FROM FUND AND
THE FUND FUND EXPENSES FUND COMPLEX**
PAID TO TRUSTEES
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Albert A. Eisenstat $0 (1995 Portfolio) Not Applicable Not Applicable $64,375
$0 (2000 Portfolio)
$0 (2005 Portfolio)
$0 (2010 Portfolio)
$0 (2015 Portfolio)
$0 (2020 Portfolio)
- ---------------------------------------------------------------------------------------------------------------------------
Ronald J. Gilson $ 259 (1995 Portfolio) Not Applicable Not Applicable $41,083
$ 357 (2000 Portfolio)
$ 284 (2005 Portfolio)
$ 255 (2010 Portfolio)
$ 271 (2015 Portfolio)
$ 324 (2020 Portfolio)
- ---------------------------------------------------------------------------------------------------------------------------
Myron S. Scholes $ 802 (1995 Portfolio) Not Applicable Not Applicable $64,375
$ 1113 (2000 Portfolio)
$ 856 (2005 Portfolio)
$ 767 (2010 Portfolio)
$ 847 (2015 Portfolio)
$ 922 (2020 Portfolio)
- ---------------------------------------------------------------------------------------------------------------------------
Kenneth E. Scott $ 770 (1995 Portfolio) Not Applicable Not Applicable $64,625
$1018 (2000 Portfolio)
$ 870 (2005 Portfolio)
$ 768 (2010 Portfolio)
$ 808 (2015 Portfolio)
$ 888 (2020 Portfolio)
- ---------------------------------------------------------------------------------------------------------------------------
Ezra Solomon $ 809 (1995 Portfolio) Not Applicable Not Applicable $62,045
$1128 (2000 Portfolio)
$ 858 (2005 Portfolio)
$ 768 (2010 Portfolio)
$ 856 (2015 Portfolio)
$ 909 (2020 Portfolio)
- ---------------------------------------------------------------------------------------------------------------------------
Isaac Stein $ 771 (1995 Portfolio) Not Applicable Not Applicable $62,375
$1007 (2000 Portfolio)
$ 862 (2005 Portfolio)
$ 763 (2010 Portfolio)
$ 808 (2015 Portfolio)
$ 866 (2020 Portfolio)
- ---------------------------------------------------------------------------------------------------------------------------
Jeanne D. Wohlers $ 816 (1995 Portfolio) Not Applicable Not Applicable $66,875
$1161 (2000 Portfolio)
$ 876 (2005 Portfolio)
$ 777 (2010 Portfolio)
$ 868 (2015 Portfolio)
$ 946 (2020 Portfolio)
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
* Interested directors receive no compensation for their services as such.

** Twentieth Century family of funds includes 66 no-load mutual funds.

INVESTMENT ADVISORY SERVICES

Each Portfolio has an investment advisory agreement with BMC dated June 1, 1995,
that was approved by shareholders on May 31, 1995.

BMC is a California corporation and a wholly owned subsidiary of Twentieth
Century Companies (TCC), a Delaware corporation. BMC, as well as BFS and BDI,
became wholly owned subsidiaries of TCC on June 1, 1995, upon the merger of
Benham Management International (BMI), the former parent of BMC, BFS and BDI,
into TCC. BMC has served as investment advisor to the Fund since the Fund's
inception. TCC is a holding company that owns all of the stock of the operating
companies that provide the investment management, transfer agency, shareholder
service, and other services for the Twentieth Century family of funds. James E.
Stowers, Jr., controls TCC by virtue of his ownership of a majority of its
common stock. BMC has been a registered investment advisor since 1971 and is
investment advisor to the rest of Twentieth Century's Benham brand mutual funds.

Each Portfolio's agreement with BMC continues for an initial period of two years
and thereafter from year to year provided that, after the initial two-year
period, it is approved at least annually by vote of a majority of the
Portfolio's outstanding shares, or by vote of a majority of the Trust's
trustees, including a majority of those trustees who are neither parties to the
agreement nor interested persons of any such party, cast in person at a meeting
called for the purpose of voting on such approval.

Each investment advisory agreement is terminable on sixty days' written notice,
either by the Portfolio or by BMC, to the other party and terminates
automatically in the event of its assignment.

Each investment advisory agreement stipulates that BMC will provide the
Portfolio with investment advice and portfolio management services in accordance
with the Portfolio's investment objective, policies, and restrictions. Each
agreement also provides that BMC will determine what securities will be
purchased and sold by the Portfolio and assist the Trust's officers in carrying
out decisions made by the board of trustees.

Under the investment advisory agreements, each Portfolio pays BMC a monthly
investment advisory fee equal to its pro rata share of the dollar amount derived
from applying the Trust's average daily net assets to the following annual
investment advisory fee schedule:

INVESTMENT ADVISORY FEE SCHEDULE FOR THE TARGET PORTFOLIOS

.35% of the first $750 million
.25% of the next $750 million
.24% of the next $1 billion
.23% of the next $1 billion
.22% of the next $1 billion
.21% of the next $1 billion
.20% of the next $1 billion
.19% of net assets over $6.5 billion

Investment advisory fees paid by each Portfolio for the fiscal years ended
September 30, 1995, 1994, and 1993, are indicated in the following table. Fee
amounts are net of amounts reimbursed and recouped as described on the following
page.

INVESTMENT ADVISORY FEES*

FISCAL FISCAL FISCAL
PORTFOLIO 1995 1994 1993

2000 Portfolio $984,031 $943,356 $820,950
2005 Portfolio 420,328 400,711 564,663
2010 Portfolio 175,368 186,373 212,938
2015 Portfolio 336,887 224,852 363,795
2020 Portfolio 422,436 152,691 143,370

*Net of reimbursements

TRANSFER AND ADMINISTRATIVE SERVICES

Twentieth Century Services, Inc., 4500 Main Street, Kansas City, Missouri,
64111, (TCS) acts as transfer, administrative services and dividend paying agent
for the Funds. TCS provides facilities, equipment and personnel to the Funds and
is paid for such services by the Funds. For administrative services, each Fund
pays TCS a monthly fee equal to its pro rata share of the dollar amount derived
from applying the average daily net assets of all of the Funds managed by the
Manager to the following administrative fee rate schedule:

GROUP ASSETS ADMINISTRATIVE FEE RATE

up to $4.5 billion .11%
up to $6 billion .10
up to $9 billion .09
over $9 billion .08

For transfer agent services, each Portfolio pays TCS monthly fees of $1.1875 for
each shareholder account maintained and $1.35 for each shareholder transaction
executed during that month.

Administrative service and transfer agent fees paid by each Portfolio for the
fiscal years ended September 30, 1995, 1994, and 1993, are indicated in the
following tables. Fee amounts are net of reimbursements as described below.

ADMINISTRATIVE FEES
FISCAL FISCAL FISCAL
PORTFOLIO 1995 1994 1993

2000 Portfolio $274,835 $265,769 $217,868
2005 Portfolio 121,534 113,361 148,149
2010 Portfolio 64,928 54,429 54,803
2015 Portfolio 108,475 66,096 94,959
2020 Portfolio 185,592 50,714 39,598

TRANSFER AGENT FEES
FISCAL FISCAL FISCAL
PORTFOLIO 1995 1994 1993

2000 Portfolio $285,145 $170,682 $147,151
2005 Portfolio 183,211 104,835 113,016
2010 Portfolio 130,450 67,306 54,491
2015 Portfolio 202,013 78,543 78,654
2020 Portfolio 350,332 69,631 41,881

DIRECT PORTFOLIO EXPENSES

Each Portfolio pays certain operating expenses that are not assumed by BMC or
TCS. These include fees and expenses of the independent trustees; custodian,
audit, tax preparation, and pricing fees; fees of outside counsel and counsel
employed directly by the Trust; costs of printing and mailing prospectuses,
statements of additional information, proxy statements, notices, confirmations,
and reports to shareholders; fees for registering the Portfolio's shares under
federal and state securities laws; brokerage fees and commissions (if any);
trade association dues; costs of fidelity and liability insurance policies
covering the Portfolio; costs for incoming WATS lines maintained to receive and
handle shareholder inquiries; and organizational costs.

EXPENSE LIMITATION AGREEMENT

BMC may recover amounts absorbed on behalf of the Portfolios during the
preceding 11 months if, and to the extent that, for any given month, the
Portfolios expense limit in effect at that time. BMC has agreed to limit the
Portfolios' expenses to .62% of the Portfolios' average daily net assets until
May 31, 1997.

The Portfolios' contractual expense limit is subject to annual renewal. The
expense limit for the year ended September 30, 1995, was .70% of average daily
net assets.

Net amounts absorbed and recouped for the fiscal years ended September 30, 1995,
1994, and 1993, are indicated in the table below.

NET REIMBURSEMENTS (RECOUPMENTS)

FISCAL FISCAL FISCAL
PORTFOLIO 1995 1994 1993

2000 Portfolio $0 $0 $0
2005 Portfolio 15,078 1,904 0
2010 Portfolio 57,258 6,924 (5,399)
2015 Portfolio 51,419 9,885 0
2020 Portfolio 243,519 27,220 6,370

ADDITIONAL PURCHASE AND REDEMPTION INFORMATION

The Portfolios' shares are continuously offered at net asset value. The Benham
Group may reject or limit the amount of an investment to prevent any one
shareholder or affiliated group from controlling the Trust or one of its series;
to avoid jeopardizing a series' tax status; or whenever, in management's
opinion, such rejection is in the Trust's or series' best interest. As of July
31, 1996, the shareholders owning 5% or more of a Fund's total outstanding
shares are listed below.

- --------------------------------------------------------------------------------
FUND SHAREHOLDER # OF SHARE HOLD % OF TOTAL
NAME AND ADDRESS SHARES OUTSTANDING
- --------------------------------------------------------------------------------

2000 Charles Schwab & Co. 490,506.013 14.3%
Portfolio 101 Montgomery Street
San Francisco, CA 94104-4122
- --------------------------------------------------------------------------------

2005 Charles Schwab & Co. 651,518.857 16.2%
Portfolio 101 Montgomery Street
San Francisco, CA 94104-4122
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
2010 National Financial Services Corp. 132,056.058 5.0%
Portfolio P.O. Box 3908
Church Street Station
New York, NY 10008-3908

Charles Schwab & Co. 599,304.060 22.8%
101 Montgomery Street
San Francisco, CA 94104-4122
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
2015 Charles Schwab & Co. 913,950.834 24.9%
Portfolio 101 Montgomery Street
San Francisco, CA 94104-4122

- --------------------------------------------------------------------------------
2020 National Financial Services Corp. 5,220,425.785 12.4%
Portfolio P.O. Box 3908
Church Street Station
New York, NY 10008-3908

Charles Schwab & Co. 14,253,036.191 33.8%
101 Montgomery Street
San Francisco, CA 94104-4122
- --------------------------------------------------------------------------------
2025 National Financial Services Corp. 148,101.953 8.1%
Portfolio P.O. Box 3908
Church Street Station
New York, NY 10008-3908

Charles Schwab & Co. 523,452.515 28.6%
101 Montgomery Street
San Francisco, CA 94104-4122
- --------------------------------------------------------------------------------

TCS charges neither fees nor commissions on the purchase and sale of fund
shares. However, TCS may charge fees for special services requested by a
shareholder or necessitated by acts or omissions of a shareholder. For example,
TCS may charge a fee for processing dishonored investment checks or stop-payment
requests. See the Investor Services Guide for more information.

Share purchases and redemptions are governed by California law.

PORTFOLIO LIQUIDATIONS. On or before January 31st of the year following a
Portfolio's target maturity year, its investments will be sold or allowed to
mature; its liabilities will be discharged, or a provision will be made for
their discharge; and its accounts will be closed. A shareholder may choose to
redeem his or her shares in one of the following ways: (i) by receiving
redemption proceeds or (ii) by exchanging shares for shares of another Benham
fund. If the Portfolio receives no instructions from a shareholder, his or her
shares will be exchanged for shares of Capital Preservation Fund (or a similar
fund if Capital Preservation Fund is not available). The estimated expenses of
terminating and liquidating a Portfolio will be accrued ratably over its target
maturity year. These expenses, which are charged to income (as are all
expenses), are not expected to exceed significantly the ordinary annual expenses
incurred by a Portfolio and, therefore, should have little or no effect on the
maturity value of the Portfolio.

OTHER INFORMATION

The Funds' investment advisor, BMC, has been continuously registered with the
SEC under the Investment Advisers Act of 1940 since December 14, 1971. The Trust
has filed a registration statement under the Securities Act of 1933 and the
Investment Company Act of 1940 with respect to the shares offered. Such
registrations do not imply approval or supervision of the Trust or the advisor
by the SEC.

For further information, refer to registration statements and exhibits on file
with the SEC in Washington, D.C. These documents are available upon payment of a
reproduction fee. Statements in the Prospectus and in this Statement of
Additional Information concerning the contents of contracts or other documents,
copies of which are filed as exhibits to the registration statement, are
qualified by reference to such contracts or documents.

19
<PAGE>
BENHAM TARGET MATURITIES TRUST

1933 Act Post-Effective Amendment No. 25
1940 Act Amendment No. 27
- --------------------------------------------------------------------------------

PART C OTHER INFORMATION

Item 24. Financial Statements and Exhibits

(a) FINANCIAL STATEMENTS. Audited financial statements for each series of
the Trust for the fiscal year ended September 30, 1995, are
incorporated herein by reference to the Registrant's Annual Report
dated September 30, 1995 filed on November 11, 1995 (Accession
# 757928-95-000003).

(b) EXHIBITS.

(1) Agreement and Declaration of Trust dated May 31, 1995, is
incorporated herein by reference to Exhibit 1(b) of
Post-Effective Amendment No. 24 filed on November 29, 1995
(Accession # 757928-95-000005).

(2) Amended and Restated Bylaws, dated May 17, 1995, are
incorporated herein by reference to Exhibit 2(b) of
Post-Effective Amendment No. 24 filed on November 29, 1995
(Accession # 757928-95-000005).

(3) Not applicable.

(4) Not applicable.

(5) Investment Advisory Agreement between Benham Target
Maturities Trust: 1995 Portfolio, Benham Target Maturities
Trust: 2000 Portfolio, Benham Target Maturities Trust: 2005
Portfolio, Benham Target Maturities Trust: 2010 Portfolio,
Benham Target Maturities Trust: 2015 Portfolio, Benham Target
Maturities Trust: 2020 Portfolio, and any additional series
and Benham Management Corporation, dated June 1, 1995, is
incorporated herein by reference to Exhibit 5(a) of
Post-Effective Amendment No. 24 filed on November 29, 1995
(Accession # 757928-95-000005).

(6) Distribution Agreement between Benham Target Maturities
Trust and Twentieth Century Securities, Inc. dated as of
September 3, 1996, is incorporated herein by reference to
Exhibit 6 of Post-Effective Amendment No. 29 to the
Registration Statement of the Benham Government Income Trust
filed on August 30, 1996 (Accession # 773674-96-000007).

(7) Not applicable.

(8) 1993 Omnibus Custodian Agreement between the Benham Group
of Funds (including Benham Target Maturities Trust) and State
Street Bank and Trust Company, dated August 10, 1993, is
incorporated herein by reference to Exhibit 8 to
Post-Effective Amendment No. 22.

(9) Administrative Services and Transfer Agency Agreement
between Benham Target Maturities Trust and Twentieth Century
Services, Inc. dated as of September 3, 1996,. is incorporated
herein by reference to Exhibit 9 of Post-Effective Amendment
No. 29 to the Registration Statement of the Benham Government
Income Trust filed on August 30, 1996 (Accession #
773674-96-000007).

(10) Opinion and consent of counsel as to the legality of the
securities being registered, dated November 14, 1995 is
incorporated herein by reference to the Rule 24f-2 Notice
filed on November 15, 1995 (Accession # 757928-95-000002).

(11) Consent of KPMG Peat Marwick, LLP, independent auditors,
is included herein.

(12) Not applicable.

(13) Not applicable.

(14) (a)Benham Individual Retirement Account Plan,
including all instructions and other relevant
documents, dated February 1992, is incorporated by
reference to Exhibit 14(a) to Post-Effective
Amendment No. 20.

(b) Benham Pension/Profit Sharing plan, including all
instructions and other relevant documents, dated
February 1992, is incorporated by reference to
Exhibit 14(b) to Post-Effective Amendment No. 20.

(15) Not applicable.

(16) Schedule for computation of each performance quotation
provided in response to Item 22 is included herein.

(17) Power of Attorney dated August 21, 1995, is incorporated
herein by reference to Exhibit 17 of Post-Effective Amendment
No. 24 filed on November 29, 1995 (Accession #
757928-95-000005).

Item 25. Persons Controlled by or Under Common Control with Registrant.

Not applicable.

Item 26. Number of Holders of Securities.

As of July 31, 1996, each Portfolio of Benham Target Maturities Trust had the
following number of shareholders of record:

2000 Portfolio........................13,384
2005 Portfolio........................12,529
2010 Portfolio..........................7288
2015 Portfolio..........................7446
2020 Portfolio..........................5190
2025 Portfolio..........................1261

Item 27. Indemnification.

As stated in Article VII, Section 3 of the Declaration of Trust, incorporated
herein by reference to Exhibit 1 to the Registration Statement, "The Trustees
shall be entitled and empowered to the fullest extent permitted by law to
purchase insurance for and to provide by resolution or in the Bylaws for
indemnification out of Trust assets for liability and for all expenses
reasonably incurred or paid or expected to be paid by a Trustee or officer in
connection with any claim, action, suit, or proceeding in which he or she
becomes involved by virtue of his or her capacity or former capacity with the
Trust. The provisions, including any exceptions and limitations concerning
indemnification, may be set forth in detail in the Bylaws or in a resolution
adopted by the Board of Trustees."

Registrant hereby incorporates by reference, as though set forth fully herein,
Article VI of the Registrant's Bylaws, amended on May 17, 1995, appearing as
Exhibit 2(b) of Post-Effective Amendment No. 24 filed on November 29, 1995
(Accession # 757928-95-000005).

Item 28. Business and Other Connections of Investment Advisor.

The Registrant's investment advisor, Benham Management Corporation, provides
investment advisory services for various collective investment vehicles and
institutional clients and serves as investment advisor to a number of open-end
investment companies.

Item 29. Principal Underwriters.

The Registrant's distribution agent, Twentieth Century Securities, Inc., is
distribution agent to Capital Preservation Fund, Inc., Capital Preservation Fund
II, Inc., Benham California Tax-Free and Municipal Funds, Benham Government
Income Trust, Benham Municipal Trust, Benham Target Maturities Trust, Benham
Equity Funds, Benham International Funds, Benham Investment Trust, Benham
Manager Funds, TCI Portfolios, Inc., Twentieth Century Capital Portfolios, Inc.,
Twentieth Century Investors, Inc., Twentieth Century Premium Reserves, Inc.,
Twentieth Century Strategic Allocations, Inc. and Twentieth Century World
Investors, Inc. The information required with respect to each director, officer
or partner of Twentieth Century Securities is incorporated herein by reference
to Twentieth Century Securities' Form B-D filed on November 21, 1985 (SEC File
No. 8-35220; Firm CRD No. 17437).

Item 30. Location of Accounts and Records.

Benham Management Corporation, the Registrant's investment advisor, maintains
its principal office at 1665 Charleston Road, Mountain View, CA 94043. The
Registrant and its agent for transfer and administrative services, Twentieth
Century Services, maintain their principal office at 4500 Main St., Kansas City,
MO 64111. Twentieth Century Services maintains physical possession of each
account, book, or other document, and shareholder records as required by
ss.31(a) of the 1940 Act and rules thereunder. The computer and data base for
shareholder records are located at Central Computer Facility, 401 North Broad
Street, Sixth Floor, Philadelphia, PA 19108.

Item 31. Management Services.

Not applicable.

Item 32. Undertakings.

Registrant undertakes to furnish each person to whom a Prospectus is delivered
with a copy of the Registrant's latest report to shareholders, upon request and
without charge.

<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant has duly caused this Post-Effective
Amendment No. 25/Amendment No. 27 to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Mountain View, and State of
California, on the 30th day of August, 1996. I hereby certify that this
Amendment meets the requirements for immediate effectiveness pursuant to Rule
485(b).

BENHAM TARGET MATURITIES TRUST

By: /s/ Douglas A. Paul
Douglas A. Paul
Vice President, Secretary, and General Counsel

Pursuant to the requirements of the Securities Act of 1933, this Post-Effective
Amendment No. 25/Amendment No. 27 has been signed below by the following persons
in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Date
<S> <C> <C>
* Chairman of the Board of Trustees, August 30, 1996
- --------------------------------- President, and
James M. Benham Chief Executive Officer

* Trustee August 30, 1996
- ---------------------------------
Albert A. Eisenstat

* Trustee August 30, 1996
- ---------------------------------
Ronald J. Gilson

* Trustee August 30, 1996
- ---------------------------------
Myron S. Scholes

* Trustee August 30, 1996
- ---------------------------------
Kenneth E. Scott

* Trustee August 30, 1996
- ---------------------------------
Ezra Solomon

* Trustee August 30, 1996
- ---------------------------------
Isaac Stein

* Trustee August 30, 1996
- ---------------------------------
James E. Stowers III

* Trustee August 30, 1996
- ---------------------------------
Jeanne D. Wohlers

* Chief Financial Officer, Treasurer August 30, 1996
- ---------------------------------
Maryanne Roepke

</TABLE>

/s/ Douglas A. Paul
*by Douglas A. Paul, Attorney in Fact (pursuant to a Power of Attorney dated
March 4, 1996).

EXHIBIT DESCRIPTION

EX-99.B1 Agreement and Declaration of Trust dated May 31, 1995, is
incorporated herein by reference to Exhibit 1(b) of Post-Effective
Amendment No. 24 filed on November 29, 1995 (Accession #
757928-95-000005).

EX-99.B2 Amended and Restated Bylaws, dated May 17, 1995, are incorporated
herein by reference to Exhibit 2(b) of Post-Effective Amendment No.
24 filed on November 29, 1995 (Accession # 757928-95-000005).

EX-99.B5 Investment Advisory Agreement between Benham Target Maturities
Trust: 1995 Portfolio, Benham Target Maturities Trust: 2000
Portfolio, Benham Target Maturities Trust: 2005 Portfolio, Benham
Target Maturities Trust: 2010 Portfolio, Benham Target Maturities
Trust: 2015 Portfolio, Benham Target Maturities Trust: 2020
Portfolio, and any additional series and Benham Management
Corporation, dated June 1, 1995, is incorporated herein by reference
to Exhibit 5(a) of Post-Effective Amendment No. 24 filed on November
29, 1995 (Accession # 757928-95-000005).

EX-99.B6 Distribution Agreement between Benham Target Maturities Trust and
Twentieth Century Securities, Inc. dated as of September 3, 1996, is
incorporated herein by reference to Exhibit 6 of Post-Effective
Amendment No. 29 to the Registration Statement of the Benham
Government Income Trust filed on August 30, 1996 (Accession #
773674-96-000007).

EX-99.B8 1993 Omnibus Custodian Agreement between the Benham Group of Funds
(including Benham Target Maturities Trust) and State Street Bank and
Trust Company, dated August 10, 1993, is incorporated herein by
reference to Exhibit 8 to Post-Effective Amendment No. 22.

EX-99.B9 Administrative Services and Transfer Agency Agreement between Benham
Target Maturities Trust and Twentieth Century Services, Inc. dated
as of September 3, 1996,. is incorporated herein by reference to
Exhibit 9 of Post-Effective Amendment No. 29 to the Registration
Statement of the Benham Government Income Trust filed on August 30,
1996 (Accession # 773674-96-000007).

EX-99.B10 Opinion and consent of counsel as to the legality of the securities
being registered, dated November 15, 1995 is incorporated herein by
reference to the Rule 24f-2 Notice filed on November 15, 1995
(Accession # 757928-95-000002).

EX-99.B11 Consent of KPMG Peat Marwick, LLP, independent auditors, is included
herein.

EX-99.B14 a) Benham Individual Retirement Account Plan, including all
instructions and other relevant documents, dated February
1992, is incorporated by reference to Exhibit 14(a) to
Post-Effective Amendment No. 20.

b) Benham Pension/Profit Sharing plan, including all instructions
and other relevant documents, dated February 1992, is
incorporated by reference to Exhibit 14(b) to Post-Effective
Amendment No. 20.

EX-99.B16 Schedule for computation of each performance quotation provided in
response to Item 22 is included herein.

EX-99.B17 Power of Attorney dated August 21, 1995, is incorporated herein by
reference to Exhibit 17 of Post-Effective Amendment No. 24 filed on
November 29, 1995 (Accession # 757928-95-000005).

EX-27.5.1 FDS - 2000 Portfolio

EX-27.5.2 FDS - 2005 Portfolio

EX-27.5.3 FDS - 2010 Portfolio

EX-27.5.4 FDS - 2015 Portfolio

EX-27.5.5 FDS - 2020 Portfolio

EX-27.5.6 FDS - 2025 Portfolio

Consent of Independent Auditors

The Board of Trustees and Shareholders
Benham Target Maturities Trust:

We consent to the inclusion in Benham Target Maturities Trust's Post-Effective
Amendment No. 25 to the Registration Statement No. 2-94608 on Form N-1A under
the Securities Act of 1933 and Amendment No. 27 to the Registration Statement
No. 811-4165 filed on Form N-1A under the Investment Company Act of 1940 of our
reports dated November 3, 1995 on the financial statements and financial
highlights of the 2000 Portfolio, 2005 Portfolio, 2010 Portfolio, 2015 Portfolio
and 2020 Portfolio (the five funds then comprising the Benham Target Maturities
Trust) for the periods indicated therein, which reports have been incorporated
by reference into the Statements of Additional Information of Benham Target
Maturities Trust. We also consent to the reference to our firm under the heading
"Financial Highlights" in the Prospectus and under the heading "About the Trust"
in the Statements of Additional Information which are incorporated by reference
in the Prospectus.

/s/KPMG Peat Marwick LLP

Kansas City, Missouri
August 30, 1996

BENHAM TARGET MATURITIES TRUST - 2000 PORTFOLIO

YIELD CALCULATION
MARCH 31, 1996

[ ( A-B ) 6 ]
Formula: Yield = 2[ (------- + 1) - 1 ]
[ ( C*D ) ]

A = Investment income earned during the period.

B = Expenses accrued for the period (net of reimbursements).

C = The average daily number of shares outstanding during the period that were
entitled to receive dividends.

D = The per share price on the last day of the period.

Calculation:

A = $1,414,679.67

B = $144,696.24

C = 3,561,178.465

D = $78.72

Yield = 5.50%

<PAGE>

BENHAM TARGET MATURITIES TRUST - 2005 PORTFOLIO
YIELD CALCULATION
MARCH 31, 1996

[ ( A-B ) 6 ]
Formula: Yield = 2[ (------- + 1) - 1 ]
[ ( C*D ) ]

A = Investment income earned during the period.

B = Expenses accrued for the period (net of reimbursements).

C = The average daily number of shares outstanding during the period that were
entitled to receive dividends.

D = The per share price on the last day of the period.

Calculation:

A = $1,289,499.44

B = $114,073.77

C = 4,097,014.646

D = $57.24

Yield = 6.09%

<PAGE>

BENHAM TARGET MATURITIES TRUST - 2010 PORTFOLIO
YIELD CALCULATION
MARCH 31, 1996

[ ( A-B ) 6 ]
Formula: Yield = 2[ (------- + 1) - 1 ]
[ ( C*D ) ]

A = Investment income earned during the period.

B = Expenses accrued for the period (net of reimbursements).

C = The average daily number of shares outstanding during the period that were
entitled to receive dividends.

D = The per share price on the last day of the period.

Calculation:

A = $663,830.08

B = $66,485.93

C = 2,722,105.631

D = $42.19

Yield = 6.32%

<PAGE>

BENHAM TARGET MATURITIES TRUST - 2015 PORTFOLIO
YIELD CALCULATION
MARCH 31, 1996

[ ( A-B ) 6 ]
Formula: Yield = 2[ (------- + 1) - 1 ]
[ ( C*D ) ]

A = Investment income earned during the period.

B = Expenses accrued for the period (net of reimbursements).

C = The average daily number of shares outstanding during the period that were
entitled to receive dividends.

D = The per share price on the last day of the period.

Calculation:

A = $710,472.37

B = $69,011.89

C = 3,751,706.060

D = $31.73

Yield = 6.55%

<PAGE>

BENHAM TARGET MATURITIES TRUST - 2020 PORTFOLIO
YIELD CALCULATION
MARCH 31, 1996

[ ( A-B ) 6 ]
Formula: Yield = 2[ (------- + 1) - 1 ]
[ ( C*D ) ]

A = Investment income earned during the period.

B = Expenses accrued for the period (net of reimbursements).

C = The average daily number of shares outstanding during the period that were
entitled to receive dividends.

D = The per share price on the last day of the period.

Calculation:

A = $4,371,166.12

B = $417,144.98

C = 32,649,582.540

D = $21.89

Yield = 6.73%

<PAGE>

BENHAM TARGET MATURITIES TRUST - 2025 PORTFOLIO
YIELD CALCULATION
MARCH 31, 1996

[ ( A-B ) 6 ]
Formula: Yield = 2[ (------- + 1) - 1 ]
[ ( C*D ) ]

A = Investment income earned during the period.

B = Expenses accrued for the period (net of reimbursements).

C = The average daily number of shares outstanding during the period that were
entitled to receive dividends.

D = The per share price on the last day of the period.

Calculation:

A = $89,212.79

B = $8,917.79

C = 847,791.820

D = $18.11

Yield = 6.36%

<PAGE>

BENHAM TARGET MATURITIES TRUST - 2025 PORTFOLIO
YIELD CALCULATION
JUNE 30, 1996

[ ( A-B ) 6 ]
Formula: Yield = 2[ (------- + 1) - 1 ]
[ ( C*D ) ]

A = Investment income earned during the period.

B = Expenses accrued for the period (net of reimbursements).

C = The average daily number of shares outstanding during the period that were
entitled to receive dividends.

D = The per share price on the last day of the period.

Calculation:

A = $151,320.92

B = $12,766.14

C = 1,477,441.026

D = $17.83

Yield = 6.40%

<PAGE>
BENHAM TARGET MATURITIES TRUST - 2000 PORTFOLIO

AVERAGE ANNUAL TOTAL RETURN
MARCH 31, 1996

( ERV ) 1/N
Formula: T = (-----) - 1
( P )

P = A hypothetical initial payment of $1,000.

ERV = Ending redeemable value of a hypothetical $1,000 payment made at the
beginning of the period.

N = Number of years.

T = Average annual total return.

P ERV N T
Calculation: --------- --------- -------- -------

One Year $1,000.00 $1,116.90 1.000000 11.69%

Five Years $1,000.00 $1,637.04 5.000000 10.36%

Ten Years $1,000.00 $2,324.28 10.000000 8.80%

Date Of Inception* $1,000.00 $4,038.65 11.023300 13.50%

*Date Of Inception: March 25, 1985

<PAGE>

BENHAM TARGET MATURITIES TRUST - 2005 PORTFOLIO
AVERAGE ANNUAL TOTAL RETURN
MARCH 31, 1996

( ERV ) 1/N
Formula: T = (-----) - 1
( P )

P = A hypothetical initial payment of $1,000.

ERV = Ending redeemable value of a hypothetical $1,000 payment made at the
beginning of the period.

N = Number of years.

T = Average annual total return.

P ERV N T
Calculation: --------- --------- -------- -------

One Year $1,000.00 $1,159.40 1.000000 15.94%

Five Years $1,000.00 $1,806.84 5.000000 12.56%

Ten Years $1,000.00 $2,494.12 10.000000 9.57%

Date Of Inception* $1,000.00 $4,821.96 11.023300 15.34%

*Date Of Inception: March 25, 1985

<PAGE>

BENHAM TARGET MATURITIES TRUST - 2010 PORTFOLIO
AVERAGE ANNUAL TOTAL RETURN
MARCH 31, 1996

( ERV ) 1/N
Formula: T = (-----) - 1
( P )

P = A hypothetical initial payment of $1,000.

ERV = Ending redeemable value of a hypothetical $1,000 payment made at the
beginning of the period.

N = Number of years.

T = Average annual total return.

P ERV N T
Calculation: --------- --------- -------- -------

One Year $1,000.00 $1,191.10 1.000000 19.11%

Five Years $1,000.00 $1,868.67 5.000000 13.32%

Ten Years $1,000.00 $2,462.43 10.000000 9.43%

Date Of Inception* $1,000.00 $5,384.32 11.023300 16.50%

*Date Of Inception: March 25, 1985

<PAGE>

BENHAM TARGET MATURITIES TRUST - 2015 PORTFOLIO
AVERAGE ANNUAL TOTAL RETURN
MARCH 31, 1996

( ERV ) 1/N
Formula: T = (-----) - 1
( P )

P = A hypothetical initial payment of $1,000.

ERV = Ending redeemable value of a hypothetical $1,000 payment made at the
beginning of the period.

N = Number of years.

T = Average annual total return.

P ERV N T
Calculation: --------- --------- -------- -------

One Year $1,000.00 $1,212.90 1.000000 21.29%

Five Years $1,000.00 $1,922.88 5.000000 13.97%

Ten Years

Date Of Inception* $1,000.00 $2,523.05 9.582200 10.14%

*Date Of Inception: September 1, 1986

<PAGE>

BENHAM TARGET MATURITIES TRUST - 2020 PORTFOLIO
AVERAGE ANNUAL TOTAL RETURN
MARCH 31, 1996

( ERV ) 1/N
Formula: T = (-----) - 1
( P )

P = A hypothetical initial payment of $1,000.

ERV = Ending redeemable value of a hypothetical $1,000 payment made at the
beginning of the period.

N = Number of years.

T = Average annual total return.

P ERV N T
Calculation: --------- --------- -------- -------

One Year $1,000.00 $1,235.30 1.000000 23.53%

Five Years $1,000.00 $1,877.76 5.000000 13.43%

Ten Years

Date Of Inception* $1,000.00 $1,824.66 6.256200 10.09%

*Date Of Inception: December 29, 1989

<PAGE>

BENHAM TARGET MATURITIES TRUST - 2025 PORTFOLIO
AVERAGE ANNUAL TOTAL RETURN
JUNE 30, 1996

( ERV ) 1/N
Formula: T = (-----) - 1
( P )

P = A hypothetical initial payment of $1,000.

ERV = Ending redeemable value of a hypothetical $1,000 payment made at the
beginning of the period.

N = Number of years.

T = Average annual total return.

P ERV N T
Calculation: --------- --------- -------- -------

One Year

Five Years

Ten Years

Date Of Inception* $1,000.00 $960.61 0.374317 -10.18%

*Date Of Inception: February 15, 1996

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