<PAGE>
SUPPLEMENT TO THE PROSPECTUS
Waddell & Reed Funds, Inc. Class B Shares
Municipal Bond Fund does not intend to invest more than 50% of
its assets in industrial development bonds.
To be attached to page 31 of the Prospectus of Waddell & Reed Funds, Inc. Class
B Shares dated June 30, 1996.
This Supplement is dated September 12, 1996.
WRS3000C0
<PAGE>
SUPPLEMENT TO THE PROSPECTUS
Waddell & Reed Funds, Inc. Class Y Shares
Municipal Bond Fund does not intend to invest more than 50% of
its assets in industrial development bonds.
To be attached to page 31 of the Prospectus of Waddell & Reed Funds, Inc. Class
Y Shares dated June 30, 1996.
This Supplement is dated September 12, 1996.
WRS3000YD
<PAGE>
SUPPLEMENT TO THE STATEMENT OF ADDITIONAL INFORMATION
Waddell & Reed Funds, Inc.
The following disclosure replaces the last sentence of the second paragraph on
page 10 in the section entitled "Municipal Bonds":
Municipal Bond Fund does not intend to invest more than 50% of its
assets in industrial development bonds.
To be attached to the cover page of the SAI of Waddell & Reed Funds, Inc. dated
June 30, 1996.
This Supplement is dated September 12, 1996.
