Rule 497(e)
Registration No. 33-12738
FUNDAMENTAL FUNDS, INC.
(NEW YORK MUNI FUND)
FUNDAMENTAL FIXED-INCOME FUND
(FUNDAMENTAL U.S. GOVERNMENT
STRATEGIC INCOME FUND)
(FUNDAMENTAL HIGH-YIELD MUNICIPAL BOND FUND)
(FUNDAMENTAL TAX-FREE MONEY MARKET FUND)
THE CALIFORNIA MUNI FUND
SUPPLEMENT DATED DECEMBER 29, 1997 TO
EACH FUND'S PROSPECTUS DATED APRIL 30, 1997
The following information supplements and supersedes any contrary
information contained in each Fund's Prospectus.
The Boards of the Fundamental Funds have approved the appointment of
Firstar Trust Company, the Funds' current Administrator and Transfer Agent, as
Custodian and Accounting Agent of the Funds, effective January 1, 1998.
Correspondance can be sent to Fundamental Family of Funds, c/o Firstar Trust
Company, P.O. Box 701, Milwaukee, WI 53201-0701 (telephone 1-800-322-6864).
Correspondance sent by overnight courrier should be addressed to Fundamental
Family of Funds, c/o Firstar Trust Company, Mutual Fund Services, Third Floor,
615 East Michigan Street, Milwaukee, WI 53202. The Transfer Agent charges a $12
service fee for each payment of redemption proceeds made by Federal wire. This
fee will be deducted from the shareholder's account. A $20 fee will be imposed
by the Transfer Agent if any check used for investment in an account does not
clear due to insufficient funds.
<PAGE>
The Boards of the Fundamental Funds have also approved the continuance
of the Funds' current Management Agreements, Distribution Agreements
(collectively, the "Agreements") and Plans of Distribution (the "Plans") for a
period of ninety days following the dates of their expiration (December 31,
1997) in contemplation of the consummation of a transaction pursuant to which
Tocqueville Asset Management L.P. would assume management of the assets of the
Funds. Otherwise, the Agreements and Plans would have expired on January 1,
1998.
