PUTNAM INVESTMENTS [GRAPHIC OMITTED: PUTNAM
SCALES LOGO]
PUTNAM INCOME FUND
Supplment to Annual Report dated October 31, 1995
The following information has been prepared to provide class Y
shareholders with a performance overview specific to their
holdings. Class Y shares are offered exclusively to defined
contribution plans investing $250 million or more in one or more
of Putnam's funds or private accounts. Performance of class Y
shares, which incur neither a front-end load, distribution fee,
nor contingent deferred sales charge, will differ from
performance of class A, B and M shares, which are discussed more
extensively in the annual report.
FISCAL 1995 RESULTS AT A GLANCE
TOTAL RETURN NAV
10/31/94 to 10/31/95
annual fiscal period 16.65%
Life of class Y
(since 5/16/94) annualized 10.97%
cummulative 16.42%
SHARE VALUE NAV
10/31/94 $6.52
10/31/95 $7.07
DISTRIBUTIONS: NO. INCOME CAPITAL GAINS TOTAL
12 $0.494 --- $0.494
CURRENT RETURN (END OF PERIOD) TOTAL
End of period 7.07%
Current dividend rate1 6.79%
Current 30-day SEC yield2 6.32%
1Income portion of most recent distribution, annualized and
divided by NAV at end of period.
2Based only on investment income, calculated using SEC
guidelines.
Please note that past performance does not indicate future
results. Investment return and net asset value will fluctuate so
that your shares, when redeemed, may be worth more or less than
their original cost. See full Annual Report for information on
comparative benchmarks. If you have questions, please consult
your fund prospectus or call Putnam toll free at 1-800-752-9894.
