IDS
Federal
Income
Fund
1995 semiannual report and
supplement to the prospectus
(icon) Federal building
The goals of IDS Federal Income Fund, Inc. are
to provide shareholders with a high level of
current income and safety of principal consistent
with investment in U.S. government and government
agency securities.
Distributed by
American Express
Financial Advisors Inc.
(icon) Federal building
A comfortable compromise
Balancing risk and reward is something all investors
must consider. In the fixed-income area,
intermediate-term securities issued by the federal
government and its agencies offer a good middle ground.
These securities, which form the core of Federal Income
Fund, normally provide greater investment stability than
long-term bonds, while still offering a yield higher than
that of guaranteed investments such as bank CDs. For a
conservative investor, that can be a rewarding combination.
Contents
From the president 3
From the portfolio manager 3
Financial statements 5
Notes to financial statements 8
Investments in securities 17
Board members and officers 21
IDS mutual funds 22
Supplement to the prospectus
<PAGE>
To our shareholders
(Photo of)
William R. Pearce
President of the Fund
(Photo of)
James W. Snyder
Portfolio Manager
From the president
If you're an experienced investor, you know that 1995 was an
unusually strong year for the U.S. financial markets. Perhaps
just as important, you also know that history shows that bull
markets don't last forever. Though they're often unpredictable,
declines - whether they're brief or long-lasting, moderate or
substantial - are always a possibility.
That fact reinforces the need for investors to review periodically
their long-term goals and assess whether their investment program
remains on track to achieving them. Your quarterly investment
statements are one part of that monitoring process. The other is a
meeting with your American Express financial advisor. That becomes
even more important if there's a major change in your financial
situation or in the financial markets.
William R. Pearce
From the portfolio manager
During the past six months, the bond market continued to rally
strongly, enhancing the total return to shareholders of IDS Federal
Income Fund. For the first half of the Fund's fiscal year (July
through December, 1995), the increase in the Fund's net asset value
combined with net investment income amounted to a total return of
nearly 6% (Class A shares).
The bond market's remarkable advance, which actually began late in
1994, was fueled by the favorable forces of moderate economic growth
and a surprisingly low rate of inflation. Adding further support to
the market during the past six months were two reductions of short-
term interest rates by the Federal Reserve Board and the possibility
of an agreement to balance the federal budget. The ultimate result of
all this good news was an ongoing decline in long-term interest rates,
a trend that drives up the values of previously issued bonds and, in
turn, the net asset value of bond-holders such as this Fund.
An aggressive approach
In anticipation of falling long-term rates, we maintained a relatively
aggressive strategy that centered on keeping a longer-than-average
maturity level among the securities held in our portfolio. Because a
portfolio's sensitivity to interest rate changes increases as its
average maturity lengthens, the Fund enjoyed an extra performance
boost when rates came down.
Also benefiting our results was our decision to increase our holdings
among U.S. Treasury bonds (particularly those in the five- to ten-year
maturity range), whose prices rose more during the period than those
of our core investments in mortgage-backed securities. This resulted
from the fact that falling interest rates spawn more home
refinancings, which tempers the performance of mortgage-backed
securities.
Environment little changed
We should also note that we continued to hold a small amount of
derivative securities in the portfolio. Consistent with our investment
policy, we used these investments as a hedge against unfavorable
market swings, or as an efficient investment strategy with an overall
defensive characteristic. This is in contrast to using them as tools
for risky, speculative investments.
While most of the bond market's latest major advance is now probably
behind us, we still look forward to positive performance during the
rest of the fiscal year. The key factors of modest economic growth and
subdued inflation appear to be holding forth, and there is still hope
of a successful resolution in the balanced budget negotiations. Given
that outlook, unless there is a marked reversal among those factors,
we expect to stay with the basic strategies that proved productive
over the past six months.
James W. Snyder
<PAGE>
Class A
6-month performance
(All figures per share)
Net asset value (NAV)
Dec. 31, 1995 $5.09
June 30, 1995 $4.97
Increase $0.12
Distributions
July 1, 1995 - Dec. 31, 1995
From income $0.16
From capital gains $ --
Total distributions $0.16
Total return* +5.8%**
Class B
6-month performance
(All figures per share)
Net asset value (NAV)
Dec. 31, 1995 $5.09
June 30, 1995 $4.96
Increase $0.13
Distributions
July 1, 1995 - Dec. 31, 1995
From income $0.14
From capital gains $ --
Total distributions $0.14
Total return* +5.5%**
Class Y
6-month performance
(All figures per share)
Net asset value (NAV)
Dec. 31, 1995 $5.09
June 30, 1995 $4.97
Increase $0.12
Distributions
July 1, 1995 - Dec. 31, 1995
From income $0.17
From capital gains $ --
Total distributions $0.17
Total return* +5.9%**
* The prospectus discusses the effect of sales charges, if
any, on the various classes.
**The total return is a hypothetical investment in the Fund
with all distributions reinvested.
<PAGE>
PAGE
<TABLE>
<CAPTION>
Financial statements
Statement of assets and liabilities
IDS Federal Income Fund, Inc.
Dec. 31, 1995
_____________________________________________________________________________________________________________
Assets
_____________________________________________________________________________________________________________
<S> <C>
(Unaudited)
Investments in securities, at value (Note 1)
(identified cost $1,595,293,306) $1,674,417,854
Cash in bank on demand deposit 35,918,739
Accrued interest receivable 11,387,783
Receivable for investment securities sold 20,752,965
U.S. government securities held as collateral (Note 4) 22,247,109
_____________________________________________________________________________________________________________
Total assets 1,764,724,450
_____________________________________________________________________________________________________________
Liabilities
_____________________________________________________________________________________________________________
Dividends payable to shareholders 1,562,909
Payable for investment securities purchased 82,544,363
Payable upon return of securities loaned (Note 4) 22,247,109
Accrued investment management services fee 45,729
Accrued distribution fee 19,060
Accrued service fee 14,775
Accrued transfer agency fee 10,490
Accrued administrative services fee 4,307
Other accrued expenses 233,124
Open option contracts written, at value
(premium received $6,669,599)(Note 6) 10,103,462
_____________________________________________________________________________________________________________
Total liabilities 116,785,328
_____________________________________________________________________________________________________________
Net assets applicable to outstanding capital stock $1,647,939,122
_____________________________________________________________________________________________________________
Represented by
_____________________________________________________________________________________________________________
Capital stock -- authorized 10,000,000,000 shares of $.01 par value $ 3,237,474
Additional paid-in capital 1,640,527,046
Undistributed net investment income 708,960
Accumulated net realized loss (Notes 1 and 8) (69,508,945)
Unrealized appreciation (Note 5) 72,974,587
_____________________________________________________________________________________________________________
Total -- representing net assets applicable to outstanding capital stock $1,647,939,122
_____________________________________________________________________________________________________________
Net assets applicable to outstanding shares: Class A $1,083,349,492
Class B $ 469,571,434
Class Y $ 95,018,196
Net asset value per share of outstanding capital stock: Class A shares 212,791,088 $ 5.09
Class B shares 92,291,684 $ 5.09
Class Y shares 18,664,603 $ 5.09
See accompanying notes to financial statements.<PAGE>
PAGE
Financial statements
Statement of operations
IDS Federal Income Fund, Inc.
Six months ended Dec. 31, 1995
_____________________________________________________________________________________________________________
Investment income
_____________________________________________________________________________________________________________
(Unaudited)
Income:
Interest $54,755,781
_____________________________________________________________________________________________________________
Expenses (Note 2):
Investment management services fee 3,800,838
Distribution fee -- Class B 1,414,084
Transfer agency fee 835,901
Incremental transfer agency fee -- Class B 14,161
Service fee
Class A 887,982
Class B 329,257
Administrative services fee 359,141
Compensation of board members 15,431
Compensation of officers 6,355
Custodian fees 51,406
Postage 118,035
Registration fees 186,628
Reports to shareholders 18,607
Audit fees 17,500
Administrative 5,844
Other 13,175
_____________________________________________________________________________________________________________
Total expenses 8,074,345
Earnings credits on cash balances (Note 2) (1,289)
_____________________________________________________________________________________________________________
Total net expenses 8,073,056
_____________________________________________________________________________________________________________
Investment income -- net 46,682,725
_____________________________________________________________________________________________________________
Realized and unrealized gain (loss) -- net
_____________________________________________________________________________________________________________
Net realized gain on security transactions (Note 3) 9,539,616
Net realized loss on closed interest rate futures contracts (23,832,954)
Net realized gain on closed, exercised or expired option
contracts written (Note 6) 2,429,200
_____________________________________________________________________________________________________________
Net realized loss on investments (11,864,138)
Net change in unrealized appreciation or depreciation 50,134,147
_____________________________________________________________________________________________________________
Net gain on investments 38,270,009
_____________________________________________________________________________________________________________
Net increase in net assets resulting from operations $84,952,734
_____________________________________________________________________________________________________________
See accompanying notes to financial statements.
/TABLE
<PAGE>
PAGE
<TABLE>
<CAPTION>
Financial statements
Statements of changes in net assets
IDS Federal Income Fund, Inc.
_____________________________________________________________________________________________________________
Operations and distributions Dec. 31 1995 June 30, 1995
_____________________________________________________________________________________________________________
<S> <C> <C>
Six months ended Year ended
(Unaudited)
Investment income -- net $ 46,682,725 $ 71,607,308
Net realized loss on investments (11,864,138) (23,666,307)
Net change in unrealized appreciation or depreciation 50,134,147 52,857,972
_____________________________________________________________________________________________________________
Net increase in net assets resulting from operations 84,952,734 100,798,973
_____________________________________________________________________________________________________________
Distributions to shareholders from:
Net investment income
Class A (32,840,474) (64,225,838)
Class B (10,852,629) (4,334,929)
Class Y (2,949,122) (1,938,661)
_____________________________________________________________________________________________________________
Total distributions (46,642,225) (70,499,428)
_____________________________________________________________________________________________________________
Capital share transactions (Note 7)
_____________________________________________________________________________________________________________
Proceeds from sales
Class A shares (Note 2) 374,660,367 641,569,225
Class B shares 311,060,410 138,024,110
Class Y shares 16,911,097 89,538,242
Fund merger (Note 9)
Class A shares -- 3,521,950
Class B shares -- 213,190,532
Reinvestment of distributions at net asset value
Class A shares 28,250,428 54,545,686
Class B shares 10,499,112 4,222,182
Class Y shares 2,949,122 1,657,604
Payments for redemptions
Class A shares (322,538,483) (771,657,740)
Class B shares (Note 2) (154,323,960) (68,176,074)
Class Y shares (12,596,122) (7,300,426)
_____________________________________________________________________________________________________________
Increase in net assets from capital share transactions 254,871,971 299,135,291
_____________________________________________________________________________________________________________
Total increase in net assets 293,182,480 329,434,836
Net assets at beginning of period 1,354,756,642 1,025,321,806
_____________________________________________________________________________________________________________
Net assets at end of period
(including undistributed net investment income of
$708,960 and $668,460) $1,647,939,122 $1,354,756,642
_____________________________________________________________________________________________________________
See accompanying notes to financial statements.
</TABLE>
<PAGE>
PAGE
IDS Federal Income Fund, Inc.
Notes to financial statements
(Unaudited as to Dec. 31, 1995)
______________________________________________________________________________
1. Summary of significant accounting policies
The Fund is registered under the Investment Company Act of 1940 (as amended)
as a diversified, open-end management investment company. The goal of the Fund
is to provide shareholders with a high level of current income and safety of
principal consistent with investment in U.S. government and government agency
securities. The Fund offers Class A, Class B and Class Y shares. Class A
shares are sold with a front-end sales charge. Class B shares, which the Fund
began offering on March 20, 1995, may be subject to a contingent deferred
sales charge. Class B shares automatically convert to Class A shares after
eight years. Class Y shares, which the Fund also began offering on March 20,
1995, have no sales charge and are offered only to qualifying institutional
investors.
All classes of shares have identical voting, dividend, liquidation and other
rights, and the same terms and conditions, except that the level of
distribution fee, transfer agency fee and service fee (class specific
expenses) differs among classes. Income, expenses (other than class specific
expenses) and realized and unrealized gains or losses on investments are
allocated to each class of shares based upon its relative net assets.
Significant accounting policies followed by the Fund are summarized below:
Use of estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of increase and decrease in net assets from operations
during the period. Actual results could differ from those estimates.
Valuation of securities
All securities are valued at the close of each business day. Securities traded
on national securities exchanges or included in national market systems are
valued at the last quoted sales price; securities for which market quotations
are not readily available are valued at fair value according to methods
selected in good faith by the board. Determination of fair value involves,
among other things, reference to market indexes, matrixes and data from
independent brokers. Short-term securities maturing in more than 60 days from
the valuation date are valued at the market price or approximate market value
based on current interest rates; those maturing in 60 days or less are valued
at amortized cost.
Option transactions
In order to produce incremental earnings, protect gains, and facilitate buying
and selling of securities for investment purposes, the Fund may buy and sell
put and call options and write covered call options on portfolio securities
and may write cash-secured put and call options on U.S. government securities.
The Fund also may purchase mortgage-backed security (MBS) put spread options
and write covered MBS call spread options. MBS spread options are based upon
the changes in the price spread between a specified mortgage-backed security
and a like-duration Treasury security. The risk in writing a call option is
that the Fund gives up the opportunity of profit if the market price of the
security increases. The risk in writing a put option is that the Fund may
incur a loss if the market price of the security decreases and the option is
exercised. The risk in buying an option is that the Fund pays a premium
whether or not the option is exercised. The Fund also has the additional risk
of not being able to enter into a closing transaction if a liquid secondary
market does not exist. The Fund also may write over-the-counter options where
the completion of the obligation is dependent upon the credit standing of the
other party.
Option contracts are valued daily at the closing prices on their primary
exchanges and unrealized appreciation or depreciation is recorded. The Fund
will realize a gain or loss upon expiration or closing of the option
transaction. When options on debt securities or futures are exercised, the
Fund will realize a gain or loss. When other options are exercised, the
proceeds on sales for a written call option, the purchase cost for a written
put option or the cost of a security for a purchased put or call option is
adjusted by the amount of premium received or paid.
Futures transactions
In order to gain exposure to or protect itself from changes in the market, the
Fund may buy and sell interest rate futures contracts. Risks of entering into
futures contracts and related options include the possibility that there may
be an illiquid market and that a change in the value of the contract or option
may not correlate with changes in the value of the underlying securities.
Upon entering into a futures contract, the Fund is required to deposit either
cash or securities in an amount (initial margin) equal to a certain percentage
of the contract value. Subsequent payments (variation margin) are made or
received by the Fund each day. The variation margin payments are equal to the
daily changes in the contract value and are recorded as unrealized gains and
losses. The Fund recognizes a realized gain or loss when the contract is
closed or expires.
Federal taxes
Since the Fund's policy is to comply with all sections of the Internal Revenue
Code applicable to regulated investment companies and to distribute all of its
taxable income to shareholders, no provision for income or excise taxes is
required.
Net investment income (loss) and net realized gains (losses) may differ for
financial statement and tax purposes primarily because of the deferral of
losses on certain futures contracts, the recognition of certain foreign
currency gains (losses) as ordinary income (loss) for tax purposes, and losses
deferred due to "wash sale" transactions. The character of distributions made
during the year from net investment income or net realized gains may differ
from their ultimate characterization for federal income tax purposes. Also,
due to the timing of dividend distributions, the fiscal year in which amounts
are distributed may differ from the year that the income or realized gains
(losses) were recorded by the Fund.
Dividends to shareholders
Dividends from net investment income, declared daily and payable monthly, are
reinvested in additional shares of the Fund at net asset value or payable in
cash. Capital gains, when available, are distributed along with the last
income dividend of the calendar year.
Other
Security transactions are accounted for on the date securities are purchased
or sold. Interest income, including level-yield amortization of premium and
discount is accrued daily.
______________________________________________________________________________
2. Expenses and sales charges
Effective March 20, 1995, when the Fund began offering multiple classes of
shares, the Fund entered into agreements with AEFC for managing its portfolio,
providing administrative services and serving as transfer agent as follows:
Under its Investment Management Services Agreement, AEFC determines which
securities will be purchased, held or sold. The management fee is a percentage
of the Fund's average daily net assets in reducing percentages from 0.52% to
0.395% annually.
Under an Administrative Services Agreement, the Fund pays AEFC for
administration and accounting services at a percentage of the Fund's average
daily net assets in reducing percentages from 0.05% to 0.025% annually.
Under a separate Transfer Agency Agreement, AEFC maintains shareholder
accounts and records. The Fund pays AEFC an annual fee per shareholder account
for this service as follows:
o Class A $15.50
o Class B $16.50
o Class Y $15.50
Also effective March 20, 1995, the Fund entered into agreements with American
Express Financial Advisors Inc. for distribution and shareholder servicing-
related services as follows: Under a Plan and Agreement of Distribution, the
Fund pays a distribution fee at an annual rate of 0.75% of the Fund's average
daily net assets attributable to Class B shares for distribution-related
services.
Under a Shareholder Service Agreement, the Fund pays a fee for service
provided to shareholders by financial advisors and other servicing agents. The
fee is calculated at a rate of 0.175% of the Fund's average daily net assets
attributable to Class A and Class B shares.
AEFC will assume and pay any expenses (except taxes and brokerage commissions)
that exceed the most restrictive applicable state expense limitation.
Sales charges received by American Express Financial Advisors Inc. for
distributing Fund shares were $13,493,127 for Class A and $110,402 for Class B
for the six months ended Dec. 31, 1995. The Fund also pays custodian fees to
American Express Trust Company, an affiliate of AEFC.
During the six months ended Dec. 31, 1995, the Fund's custodian and transfer
agency fees were reduced by $1,289 as a result of earnings credits from
overnight cash balances.
The Fund has a retirement plan for its independent board members. Upon
retirement, board members receive monthly payments equal to one-half of the
retainer fee for as many months as they served as board members up to 120
months. There are no death benefits. The plan is not funded, but the Fund
recognizes the cost of payments during the time the board members serve on the
board. The retirement plan expense amounted to $4,982 for the six months ended
Dec. 31, 1995.
______________________________________________________________________________
3. Securities transactions
Cost of purchases and proceeds from sales of securities (other than short-term
obligations) aggregated $1,183,096,761 and $899,008,183, respectively, for the
six months ended Dec. 31, 1995. Realized gains and losses are determined on an
identified cost basis.
______________________________________________________________________________
4. Lending of portfolio securities
At Dec. 31, 1995, securities valued at $21,726,155 were on loan to brokers.
For collateral, the Fund received U.S. government securities valued at
$22,247,109. Income from securities lending amounted to $59,308 for the six
months ended Dec. 31, 1995. The risks to the Fund of securities lending are
that the borrower may not provide additional collateral when required or
return the securities when due.
______________________________________________________________________________
5. Interest rate futures contracts
At Dec. 31, 1995, investments in securities included securities valued at
$48,655,500 that were pledged as collateral to cover initial margin deposit on
400 open purchase contracts and 1,605 open sale contracts. The market value of
the open contracts at Dec. 31, 1995 was $235,001,719 with a net unrealized
loss of $2,716,098.
______________________________________________________________________________
6. Options contracts written
The number of contracts and premium amounts associated with options contracts
written is as follows:
<TABLE>
<CAPTION>
Six months ended Dec. 31, 1995
__________________________________________________________________________
Puts Calls MBS Puts and Calls
__________________________________________________________________________
Contracts Premium Contracts Premium Notional Premium
_________________________________________________________________________________________________
<S> <C> <C> <C> <C> <C> <C>
Balance June 30, 1995 1,325 $ 1,198,457 1,016 $ 1,902,171 $ -- $ --
Opened 8,077 9,889,483 10,263 13,844,434 34,500,000 1,988,437
Closed (7,083) (8,730,730) (6,198) (7,503,245) (30,700,000) (1,802,656)
Exercised (1,237) (1,128,428) (1,519) (1,804,846) -- --
Expired (209) (67,408) (1,412) (1,116,070) -- --
_________________________________________________________________________________________________
Balance Dec. 31, 1995 873 $ 1,161,374 2,150 $ 5,322,444 $ 3,800,000 $ 185,781
_________________________________________________________________________________________________
</TABLE>
<PAGE>
7. Capital share transactions
Transactions in shares of capital stock for the periods indicated are as
follows:
Six months ended Dec. 31, 1995
Class A Class B Class Y
_____________________________________________________________
Sold 74,894,798 62,202,838 3,383,556
Issued for reinvested 5,636,715 2,094,234 593,028
distributions
Redeemed (64,476,383) (30,829,592) (2,522,244)
_____________________________________________________________
Net increase 16,055,130 33,467,480 1,454,340
_____________________________________________________________
Year ended June 30, 1995
Class A Class B* Class Y*
____________________________________________________________
Sold 132,313,514 28,069,540 18,364,074
Fund Merger 723,045 43,767,303 --
Issued for reinvested 11,239,784 856,748 336,591
distributions
Redeemed (159,116,207) (13,869,387) (1,490,402)
_____________________________________________________________
Net increase (decrease) (14,839,864) 58,824,204 17,210,263
_____________________________________________________________
*Inception date was March 20, 1995.
______________________________________________________________________________
8. Capital loss carryover
For federal income tax purposes, the Fund had a capital loss carryover of
approximately $59,505,000 at Dec. 31, 1995, that if not offset by subsequent
capital gains, will expire in 2002 and 2003. It is unlikely the board will
authorize a distribution of any net realized gains until the available capital
loss carryover has been offset or expires.
<PAGE>
9. Fund merger
On March 17, 1995, IDS Federal Income Fund acquired the assets and assumed
the identified liabilities of IDS Strategy -- Short-Term Income Fund.
The aggregate net assets of IDS Federal Income Fund immediately before the
acquisition was $1,015,587,336.
The merger was accomplished by a tax-free exchange of 219,863,326 shares of
IDS Strategy -- Short-Term Income Fund valued at $216,712,482.
In exchange for the IDS Strategy -- Short-Term Income Fund shares and assets,
IDS Federal Income Fund issued the following number of shares:
Class A 723,045
Class B 43,767,303
IDS Strategy -- Short-Term Income Fund's net assets at that date were as
follows, which include the following amounts of capital stock, unrealized
depreciation and accumulated net realized loss that was combined with IDS
Federal Income Fund.
Total net Capital stock Unrealized Accumulated net
assets depreciation realized loss
___________________________________________________________________________
Class A $ 3,521,950 $ 3,580,826 $ (31,076) $ (27,800)
Class B 213,190,532 216,754,432 (1,881,087) (1,682,813)
<PAGE>
10. Financial highlights
<TABLE>
<CAPTION>
The table below shows certain important financial information
for evaluating the Fund's results.
Fiscal period ended June 30,
Per share income and capital changes*
Class A
1995** 1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C> <C>
Net asset value, $4.97 $4.85 $5.30 $5.19 $5.10 $5.00
beginning of period
Income from investment operations:
Net investment income .16 .32 .29 .32 .36 .42
Net gains (losses) .12 .11 (.31) .13 .09 .09
(both realized
and unrealized)
Total from investment .28 .43 (.02) .45 .45 .51
operations
Less distributions:
Dividends from net (.16) (.31) (.29) (.32) (.36) (.41)
investment income
Distributions from -- -- (.14) (.02) -- --
realized gains
Total distributions (.16) (.31) (.43) (.34) (.36) (.41)
Net asset value, $5.09 $4.97 $4.85 $5.30 $5.19 $5.10
end of period
Ratios/supplemental data
1995** 1995 1994 1993 1992 1991
Net assets, end of period $1,083 $977 $1,025 $1,025 $834 $397
(in millions)
Ratio of expenses to .91%*** .79% .76% .77% .79% .80%
average daily net assets
Ratio of net income to 6.47%*** 6.59% 5.64% 6.03% 6.93% 8.20%
average daily net assets
Portfolio turnover rate 61% 213% 304% 227% 104% 52%
(excluding short-term
securities)
Total return+ 5.8% 9.3% (0.5%) 9.0% 9.0% 10.8%
*For a share outstanding throughout the period. Rounded to the nearest cent.
**Six months ended Dec. 31, 1995 (Unaudited).
***Adjusted to an annual basis.
+Total return does not reflect payment of a sales charge.
/TABLE
<PAGE>
<TABLE>
<CAPTION>
Fiscal period ended June 30,
Per share income and capital changes*
Class B Class Y
1995*** 1995** 1995*** 1995**
<S> <C> <C> <C> <C>
Net asset value, $4.96 $4.87 $4.97 $4.87
beginning of period
Income from investment operations:
Net investment income .14 .06 .17 .07
Net gains .13 .14 .12 .15
(both realized
and unrealized)
Total from investment .27 .20 .29 .22
operations
Less distributions:
Dividends from net (.14) (.11) (.17) (.12)
investment income
Net asset value, $5.09 $4.96 $5.09 $4.97
end of period
Ratios/supplemental data
Class B Class Y
1995*** 1995** 1995*** 1995**
Net assets, end of period $470 $292 $95 $85
(in millions)
Ratio of expenses to 1.67%+ 1.74%+ .73%+ .75%+
average daily net assets
Ratio of net income to 5.73%+ 6.21%+ 6.66%+ 7.20%+
average daily net assets
Portfolio turnover rate 61% 213% 61% 213%
(excluding short-term
securities)
Total return++ 5.5% 4.1% 5.9% 4.5%
*For a share outstanding throughout the period.
Rounded to the nearest cent.
**Inception date was March 20, 1995 for Class B and Y.
***Six months ended Dec. 31, 1995 (Unaudited).
+Adjusted to an annual basis.
++Total return does not reflect payment of a sales charge.
</TABLE>
<PAGE>
PAGE
<TABLE>
<CAPTION>
Investments in securities
IDS Federal Income Fund, Inc. (Percentages represent value of
Dec. 31, 1995 (Unaudited) investments compared to net assets)
_____________________________________________________________________________________________________________________________
Bonds (99.5%)
_____________________________________________________________________________________________________________________________
Issuer Coupon Maturity Principal Value(a)
rate year amount
_____________________________________________________________________________________________________________________________
<S> <C> <C> <C> <C>
U.S. government obligations (26.4%)
U.S. Treasury 5.625% 2000 $ 17,275,000 $ 17,447,059
6.25 2000-23 35,200,000 36,368,042
6.50 2005 5,000,000 5,330,750
6.75 2000 15,400,000 (h) 16,215,430
6.875 2000 48,700,000 (h) 51,501,711
7.25 2016 4,000,000 4,567,560
7.50 2024 3,490,000 4,192,781
7.875 1996 5,000,000 5,015,950
8.125 2019 16,000,000 20,119,360
Zero Coupon 6.50 1999 37,500,000 (b) 31,440,000
Resolution Funding Corp 8.125 2019 8,000,000 9,912,960
Zero Coupon 6.06 2001 20,863,000 (b) 15,968,332
6.19 2002 18,050,000 (b,e,f) 12,818,027
6.20 2008 9,800,000 (b) 4,711,840
6.26 2006 22,500,000 (b) 12,359,250
6.28 2006 6,000,000 (b) 3,201,180
6.39 2003 16,000,000 (b,h) 10,360,640
6.39 2007 49,653,000 (b) 25,562,357
6.70 1999 43,335,000 (b,e,f) 36,443,868
7.02 2010 19,000,000 (b) 7,791,900
7.08 2007 38,120,000 (b) 19,316,929
7.17 2018 38,250,000 (b) 9,227,812
7.18 2009 16,000,000 (b) 6,969,280
7.87 2018-19 24,000,000 (b) 5,638,065
7.94 2012 89,150,000 (b) 32,669,018
8.04 2012 8,400,000 (b) 2,979,900
8.09 2012 74,200,000 (b) 26,775,070
______________
Total 434,905,071
_____________________________________________________________________________________________________________________________
Mortgage-backed securities (73.1%)
Federal Home Loan Mortgage Corporation (20.0%)
6.50 2003-10 30,436,959 30,612,676
7.00 2010 23,604,819 24,047,409
7.50 2024 9,380,655 9,629,805
8.00 2023-25 102,088,822 105,838,758
11.50 2024 5,323,528 5,897,457
Collateralized Mtge Obligation 6.75 2022 22,000,000 22,172,040
7.00 2021 10,000,000 10,180,800
8.25 2024 28,475,775 30,802,815
8.50 2022 9,150,000 10,168,395
Interest Only 10.00 2020 725,773 (c) 113,962
Inverse Floater 2.836 2008 2,322,561 (d) 1,894,444
5.04 2008 6,436,099 (d) 5,740,100
5.606 2023 3,956,343 (d) 3,117,994
5.845 2023 10,514,507 (d) 8,133,076
See accompanying notes to investments in securities.<PAGE>
5.85 2024 10,642,081 (d) 9,146,975
7.84 2022 11,779,586 (d) 10,749,932
8.05 2023 29,877,229 (d) 26,747,043
8.60 2008 6,331,388 (d) 6,073,511
13.317 2021 8,460,735 (d) 9,129,810
______________
Total 330,197,002
_____________________________________________________________________________________________________________________________
Federal National Mortgage Association (52.0%)
6.00 2009-23 45,496,182 44,763,012
6.50 2023-25 268,019,621 (e,f) 265,152,688
7.00 2023-25 169,177,588 170,645,832
7.50 2025 24,503,574 25,108,567
8.00 2021 5,746,623 5,958,558
8.50 2007-25 129,782,200 135,590,794
9.00 2023-24 19,186,199 20,229,545
12.00 2016 5,855,990 6,637,414
Collateralized Mtge Obligation 3.00 2019 11,250,000 9,767,700
4.50 2010 8,204,208 7,430,469
4.70 2022 12,732,716 12,628,435
5.00 2024 6,663,083 6,526,423
5.50 2008 12,985,885 12,756,424
6.00 2008 8,610,012 8,574,797
6.50 2017 2,965,318 2,962,323
7.00 2012 7,658,672 7,755,248
8.50 2021 12,350,000 13,206,226
9.515 2023 9,203,533 8,621,962
Interest Only 9.50 2018-23 19,586,586 (c) 15,592,857
10.00 2018-23 39,545,441 (c) 38,223,504
10.50 2021 5,671,001 (c) 5,060,829
Inverse Floater 5.673 2023 2,172,391 (d) 2,039,028
6.126 2023 6,052,314 (d) 5,221,573
7.17 2024 5,497,886 (d) 5,012,258
7.577 2023 3,456,299 (d) 2,736,317
8.406 2022 6,501,858 (d) 6,391,977
11.20 2021 10,856,119 (d) 11,205,578
Principal Only 12.568 2021 1,044,779 (g) 825,939
______________
Total 856,626,277
_____________________________________________________________________________________________________________________________
Government National Mortgage Association (1.1%)
9.00 2022 202,403 214,610
11.00 2010-19 16,435,386 18,528,439
______________
Total 18,743,049
_____________________________________________________________________________________________________________________________
Other mortgage-backed securities (--%)
Daiwa Securities
Collateralized Mtge Obligation
Inverse Floater 12.37 2009 42,780 (d) 42,780
_____________________________________________________________________________________________________________________________
Total bonds
(Cost: $1,561,372,122) $1,640,514,179
_____________________________________________________________________________________________________________________________
Options purchased (--%)
_____________________________________________________________________________________________________________________________
Issuer Number of Exercise Expiration Value (a)
contracts price date
_____________________________________________________________________________________________________________________________
Put
March T-bond Futures 58 $116 March 1996 $ 13,593
_____________________________________________________________________________________________________________________________
Total options purchased
(Cost: $31,102) $ 13,593
_____________________________________________________________________________________________________________________________
</TABLE>
<TABLE>
<CAPTION>
Short-term securities (2.1%)
_____________________________________________________________________________________________________________________________
Issuer Annualized Amount Value(a)
yield on payable
date of at
purchase maturity
_____________________________________________________________________________________________________________________________
<S> <C> <C> <C>
U.S. government agencies (1.8%)
Federal Home Loan Bank
Disc Note
01-16-96 5.70% $ 900,000 $ 897,590
Federal Home Loan
Mtge Corp Disc Notes
01-16-96 5.69 7,500,000 7,479,954
01-18-96 5.68 5,800,000 5,782,705
01-22-96 5.70 3,100,000 3,088,770
Federal Natl Mtge Assn
Disc Notes
01-04-96 5.70 3,300,000 3,297,397
01-16-96 5.70 4,400,000 4,388,219
01-17-96 5.47 4,400,000 4,388,010
Total 29,322,645
_____________________________________________________________________________________________________________________________
Commercial paper (0.3%)
Southwestern Bell Telephone
02-14-96 5.59 4,600,000 4,567,437
_____________________________________________________________________________________________________________________________
Total short-term securities
(Cost: $33,890,082) $ 33,890,082
_____________________________________________________________________________________________________________________________
Total investments in securities
(Cost: $1,595,293,306)(i) $1,674,417,854
_____________________________________________________________________________________________________________________________
Notes to investments in securities
_____________________________________________________________________________________________________________________________
(a) Securities are valued by procedures described in Note 1 to the
financial statements.
(b) For zero coupon bonds, the interest rate disclosed represents the
annualized effective yield on the date of acquisition.
(c) Interest-only represents securities that entitle holders to receive
only interest payments on the underlying mortgages. The yield to
maturity of an interest-only is extremely sensitive to the rate of
principal payments on the underlying mortgage assets. A rapid (slow)
rate of principal repayments may have an adverse (positive) effect
on yield to maturity.
(d) Inverse floaters represent securities that pay interest at a rate
that increases (decreases) in the same magnitude as, or in a multiple of,
a decline (increase) in the LIBOR (London InterBank Offering Rate) Index.
Interest rate disclosed is the rate in effect on Dec. 31, 1995.
(e) Partially pledged as initial deposit on the following open interest
rate futures contracts (see Note 5 to the financial statements):
Type of security Notional amount
________________________________________________________________
Purchase contracts
U.S. Treasury Note March 96, 5-year notes $ 40,000,000
Sale contracts
U.S. Treasury Bonds March 96 100,600,000
U.S. Treasury Note March 96, 10-year notes 59,900,000
(f) At Dec. 31, 1995, securities valued at $48,655,500 were held to cover
open call options written as follows:
<CAPTION>
Issuer Number of Exercise Expiration Value(a)
contracts price date
___________________________________________________________________________________
<S> <C> <C> <C> <C>
U.S. Treasury Bonds March 96 1,165 $116 Feb. 1996 $6,589,531
U.S. Treasury Bonds March 96 473 118 Feb. 1996 1,869,826
U.S. Treasury Bonds March 96 332 120 Feb. 1996 845,561
U.S. Treasury Bonds March 96 180 122 Feb. 1996 261,562
Mortgage-Backed Security (MBS) Spread 1,300 98 Jan. 1998 82,266
At Dec. 31, 1995, cash or short-term securities were designated to
cover open put options written as follows:
Issuer Number of Exercise Expiration Value(a)
contracts price date
__________________________________________________________________________________
U.S. Treasury Bonds March 96 300 $116 Feb. 1996 $ 70,311
U.S. Treasury Bonds March 96 473 118 Feb. 1996 251,281
U.S. Treasury Bonds March 96 100 120 Feb. 1996 107,812
Mortgage-Backed Security (MBS) Spread 1,300 98 Jan. 1998 12,187
Mortgage-Backed Security (MBS) Spread 1,200 98 Jan. 1998 13,125
(g) Principal only represents securities that entitle holders to receive
only principal payments on the underlying mortgages. The yield to
maturity of a principal only is sensitive to the rate of principal
payments on the underlying mortgage assets. A slow (rapid) rate of
principal repayments may have an adverse (positive) effect on yield
to maturity. Interest rate disclosed represents current yield based
upon the current cost basis and estimated timing of future cash flows.
(h) Security is partially or fully on loan. See Note 4 to the financial
statements.
(i) At Dec. 31, 1995, the cost of securities for federal income tax
purposes was approximately $1,595,289,000 and the approximate aggregate
gross unrealized appreciation and depreciation based on that cost was:
Unrealized appreciation $89,014,000
Unrealized depreciation (9,885,000)
____________________________________________________________
Net unrealized appreciation $79,129,000
____________________________________________________________
</TABLE>
<PAGE>
PAGE
Board members and officers
Board members and officers of the Fund
_____________________________________________________________________
President and interested board member
William R. Pearce
President of all funds in the IDS MUTUAL FUND GROUP.
_____________________________________________________________________
Independent board members
Lynne V. Cheney
Distinguished fellow, American Enterprise Institute for
Public Policy Research.
Robert F. Froehlke
Former president of all funds in the IDS MUTUAL FUND GROUP.
Heinz F. Hutter
Former president and chief operating officer, Cargill, Inc.
Anne P. Jones
Attorney and telecommunications consultant.
Donald M. Kendall
Former chairman and chief executive officer, PepsiCo, Inc.
Melvin R. Laird
Senior counsellor for national and international affairs,
The Reader's Digest Association, Inc.
Lewis W. Lehr
Former chairman and chief executive officer,
Minnesota Mining and Manufacturing Company (3M).
Edson W. Spencer
Former chairman and chief executive officer, Honeywell, Inc.
Wheelock Whitney
Chairman, Whitney Management Company.
C. Angus Wurtele
Chairman of the board and chief executive officer, The Valspar Corporation.
_____________________________________________________________________
Interested board members who are officers and/or employees of AEFC
William H. Dudley
Executive vice president, AEFC.
David R. Hubers
President and chief executive officer, AEFC.
John R. Thomas
Senior vice president, AEFC.
_____________________________________________________________________
Officers who are officers and/or employees of AEFC
Peter J. Anderson
Vice President of all funds in the IDS MUTUAL FUND GROUP.
Melinda S. Urion
Treasurer of all funds in the IDS MUTUAL FUND GROUP.
___________________________________________________________________
Other officer
Leslie L. Ogg
Vice president general Counsel and secretary of all funds in
the IDS MUTUAL FUND GROUP.<PAGE>
PAGE
IDS mutual funds
Cash equivalent investments
These money market funds have three main goals: conservation of
capital, constant liquidity and the highest possible current income
consistent with these objectives. Very limited risk.
IDS Cash Management Fund
Invests in such money market securities as high quality commercial
paper, bankers' acceptances, certificates of deposit (CDs) and
other bank securities.
(icon of) piggy bank
IDS Tax-Free Money Fund
Invests primarily in short-term bonds and notes issued by state and
local governments to seek high current income exempt from federal
income taxes.
(icon of) shield with piggy bank enclosed
Income investments
The funds in this group invest their assets primarily in corporate
bonds or government securities to seek interest income.
Secondary objective is capital growth. Risk varies by bond quality.
IDS Global Bond Fund
Invests primarily in debt securities of U.S. and foreign issuers to
seek high total return through income and growth of capital.
(icon of) globe
IDS Extra Income Fund
Invests mainly in long-term, high-yielding corporate fixed-income
securities in the lower rated, higher risk bond categories to seek
high current income. Secondary objective is capital growth.
(icon of) cornucopia<PAGE>
PAGE
IDS Bond Fund
Invests mainly in corporate bonds, at least 50% in the higher rated,
lower risk bond categories, or the equivalent, and in government bonds.
(icon of) greek column
IDS Selective Fund
Invests in high-quality corporate bonds and other highly rated debt
instruments including government securities and short-term
investments. Seeks current income and preservation of capital.
(icon of) skyline
IDS Federal Income Fund
Invests primarily in securities issued or guaranteed as to the timely
payment of principal and interest by the U.S. government, its agencies
and instrumentalities. Seeks a high level of current income and
safety of principal consistent with its type of investments.
(icon of) federal building
Tax-exempt income investments
These funds provide tax-free income by investing in municipal bonds.
The income is generally free from federal income tax. Risk varies
by bond quality.
IDS High Yield Tax-Exempt Fund
Invests primarily in medium- and lower-quality municipal bonds and
notes. Lower-quality securities generally involve greater risk of
principal and income.
(icon of) shield with basket of apples enclosed<PAGE>
PAGE
IDS State Tax-Exempt Funds
(CA, MA, MI, MN, NY, OH)
Invests primarily in high- and medium-grade municipal securities
to provide income to residents of each respective state that is
exempt from federal, state and local income taxes. (New York
is the only state that is exempt at the local level.)
(icon of) shield with U.S. enclosed
IDS Tax-Exempt Bond Fund
Invests mainly in bonds and notes of state or local government
units, with at least 75% in the four highest rated, lowest risk bond
categories.
(icon of) shield with Greek column
IDS Insured Tax-Exempt Fund
Invests primarily in municipal securities that are insured as to
the timely payment of principal and interest. The insurance
feature minimizes credit risk of the fund but does not guarantee
the market value of the fund's shares.
(icon of) shield with eagle head
Growth and income investments
These funds focus on securities of medium to large, well-established
companies that offer long-term growth of capital and reasonable income
from dividends and interest. Moderate risk.
IDS International Fund
Invests primarily in common stocks of foreign companies that offer
potential for superior growth. The fund may invest up to 20%
of its assets in the U.S. market.
(icon of) three flags
IDS Managed Retirement Fund
Invests in a combination of common stocks, fixed-income
investments and money market securities to seek a maximum total
return through a combination of growth of capital and current income.
(icon of) bird in a nest
<PAGE>
PAGE
IDS Equity Select Fund
Invests primarily in a combination of moderate growth stocks,
higher-yielding equities and bonds. Seeks growth of
capital and income.
(icon of) three apple trees
IDS Blue Chip Advantage Fund
Invests in selected stocks from a major market index. Securities
purchased are those recommended by our research analysts as the
best from each industry represented on the index. Offers potential
for long-term growth as well as dividend income.
(icon of) ribbon
IDS Stock Fund
Invests in common stocks of companies representing many
sectors of the economy. Seeks current income and growth of capital.
(icon of) building with columns
IDS Equity Value Fund
Invests primarily in undervalued common stocks that offer potential
for growth of capital and income.
(icon of) three growing flowers
IDS Utilities Income Fund
Invests primarily in the stocks of public utility companies to seek
high current income and growth of income and capital with reduced
volatility.
(icon of) electrical cord
IDS Diversified Equity Income Fund
Invests primarily in high-yielding common stocks to seek high current
income and, secondarily, to benefit from the growth potential offered
by stock investments.
(icon of) four puzzle pieces
IDS Mutual
Invests in a balance between common stocks and senior securities
(preferred stocks and bonds). Seeks a balance of growth of capital
and current income.
(icon of) scale of justice<PAGE>
PAGE
Growth investments
Funds in this group seek capital growth, primarily from common stocks.
They are high risk mutual funds with a potential for high reward.
IDS Discovery Fund
Invests in small- and medium-size, growth-oriented companies
emphasizing technological innovation and productivity enhancement.
Buys and holds larger growth-oriented stocks.
(icon of) ship
IDS Strategy Aggressive Fund
Invests primarily in common stocks of companies that are selected
for their potential for above-average growth. Above-average means
that their growth potential is better, in the opinion of the
portfolio's investment manager, than the Standard & Poor's
Corporation (S&P) 500 Stock Index.
(icon of) chess piece
IDS Growth Fund
Invests primarily in companies that have above-average potential
for long-term growth as a result of new management, marketing
opportunities or technological superiority.
(icon of) flower
IDS Global Growth Fund
Invests in stocks of companies throughout the world that are
positioned to meet market needs in a changing world economy.
These companies offer above-average potential for long-term growth.
(icon of) world
IDS New Dimensions Fund
Invests primarily in companies with significant growth
potential due to superiority in technology, marketing or management.
The fund frequently changes its industry mix.
(icon of) dimension
IDS Progressive Fund
Invests primarily in undervalued common stocks. The fund holds
stocks for the long term with the goal of capital growth.
(icon of) shooting star
<PAGE>
PAGE
Specialty growth investment
This fund aggressively seeks capital growth as a hedge against inflation.
IDS Precious Metals Fund
Invests primarily in the securities of foreign or domestic companies
that explore for, mine and process or distribute gold and other
precious metals. This is the most aggressive and most speculative
IDS mutual fund.
(icon of) cart of precious gems
For more complete information about any of these funds, including
charges and expenses, you can obtain a prospectus by contacting
your financial planner or writing to American Express Shareholder
Service, P.O. Box 534, Minneapolis, MN 55440-0534. Read it
carefully before you invest or send money.
<PAGE>
Supplement to the prospectus
Semi-annual Supplement--Feb. 15, 1996
Supplementing the
IDS Federal Income Fund, Inc. Prospectus
(August 29, 1995)
Form No. S-6042 J (8/95)
The prospectus for the Fund is modified by adding
the following information:
Proposed conversion to master/feeder structure
Subject to certain contingencies, the Fund intends
to invest all of its assets in the Government Income
Portfolio (the Portfolio) of Income Trust (the Trust),
a separate investment company also managed by American
Express Financial Corporation (AEFC), rather than directly
investing in and managing its own portfolio of securities.
The Fund anticipates this conversion will occur in early 1996.
The Portfolio has the same investment objectives, policies and
restrictions as the Fund. The board of the Fund believes that
by investing all of its assets in the Portfolio, the Fund will
be in a position to realize directly or indirectly certain
economies of scale inherent in managing a larger asset base. When
the Fund converts to the master/feeder structure, the policies
described in its prospectus will apply to both the Fund and
the Portfolio.
Special considerations regarding master/feeder structure
This arrangement--a fund investing its assets in a Portfolio with
an identical investment objective--is commonly known as a
master/feeder structure. The Trust is a separate investment company.
Therefore, the Fund's interest in securities owned by the Portfolio
will be indirect. The board has considered the advantages and
disadvantages of investing the assets of the Fund in the Portfolio.
The board believes that this approach offers opportunities of economies
of scale. In determining to convert to a master/feeder structure, the
board considered whether the aggregate of the fees of the Fund and the
Portfolio will be more or less than if the Fund invested directly in the
securities to be held by the Portfolio. The board negotiated certain
expense reimburement arrangements with AEFC to mitigate the impact of
increases in aggregate costs, and believes that any additional costs
not covered by such arrangements will be outweighed by the anticipated
benefits to the Fund and its shareholders of conversion to a
master/feeder structure.
The investment objective, policies and restrictions of the Portfolio
are the same as those described in the Fund's prospectus under the
captions "Investment policies and risks" and "Facts about investments
and their risks."
To date, AEFC has sponsored and advised only traditionally structured
funds that invest directly in a portfolio of securities and retain their
own investment manager. Funds that invest all their assets in interests
in a separate investment company are a relatively new development in the
mutual fund industry and may be subject to additional regulations and risks
as described in the next paragraphs.
In addition to selling units to the Fund, the Portfolio may sell units to
other affiliated and non-affiliated mutual funds and to institutional
investors. Such investors will invest in the Portfolio on the same terms
and conditions and will pay a proportionate share of the Portfolio's
expenses. However, the other investors investing in the Portfolio are
not required to sell their shares at the same price as the Fund due to
variations in sales commissions and other operatiing expenses. Therefore,
investors in the Fund should be aware that these differences may result
in differences in returns experienced by investors in the different funds
that invest in the same Portfolio.
The Fund may withdraw (completely redeem) all its assets from the
Portfolio at any time if the board determines that it is in the best
interest of the Fund to do so. In the event the Fund withdraws all of its
assets from the Portfolio, the board would consider what action might be
taken, including investing all assets of the Fund in another pooled
investment entity or retaining an investment advisor to manage the Fund's
assets in accordance with its investment objective. The investment
objective of the Fund and its Portfolio can only be changed with
shareholder approval. If the objective of the Portfolio changes and
shareholders of the Fund do not approve a parallel change in the
Fund's investment objective, the Fund would seek a alternative investment
vehicle for the Fund or retain an investment advisor on its behalf.
Investors in the Fund should be aware that smaller funds investing in the
Portfolio may be adversely affected by the actions of larger funds
investing in the Portfolio. For example, if a large fund withdraws from
the Portfolio, the remaining funds may experience higher prorated
operating expenses, thereby producing lower returns. Additionally, the
Portfolio may become less diverse, resulting in increased portfolio risk,
and experience decreasing economies of scale. Institutional investors in
the Portfolio that have a greater pro rata ownership than the Fund could
have effective voting control over the operation of the Portfolio.
Certain changes in the Portfolio's fundamental objective, polices and
restrictions could require the Fund to redeem its interest in the
Portfolio. Any such withdrawal could result in a distribution of in-kind
portfolio securities (as opposed to cash distribution). If securities
are distributed, the Fund could incur brokerage, tax or other charges in
converting the securities to cash. In addition, a distribution in kind
may result in a less diversified portfolio of investments or adversely
affect the liquidity of the Fund.
Wherever the Fund, as an investor in the Portfolio, is requested to vote
on matters pertaining to the Portfolio, the Fund will hold a meeting of
Fund shareholders. The Fund will vote its units in the Portfolio for or
against such matters proportionately to the instructions to vote for or
against such matters received from Fund shareholders. The Fund will vote
shares for which it receives no voting instructions in the same
proportion as the shares for which it receives voting instructions. Upon
the implementation of the new fund structure, AEFC will provide
investment management services to the Portfolio at the same annual rate
currently paid by the Fund. See the prospectus section "Investment
manager and transfer agent" for a complete description of the management
and other expenses associated with the Fund's investment in the Portfolio.
Form No. S-6442
*Destroy July 29, 1996
<PAGE>
PAGE
Quick telephone reference
American Express Telephone Transaction Service
Redemptions and exchanges, dividend payments or reinvestments
and automatic payment arrangements
National/Minnesota:
800-437-3133
Mpls./St. Paul area:
671-3800
American Express Shareholder Service
Fund performance, objectives and account inquiries
612-671-3733
TTY Service
For the hearing impaired
800-846-4852
American Express Infoline
Automated account information (TouchTone phones only),
including current fund prices and performance, account
values and recent account transactions
National/Minnesota:
800-272-4445
Mpls./St. Paul area:
671-1630
AMERICAN EXPRESS FINANCIAL ADVISORS
IDS Federal Income Fund, Inc.
IDS Tower 10
Minneapolis, MN 55440-0010
