Rule 497(e)
                                                        Registration No. 2-82710

                           FUNDAMENTAL FAMILY OF FUNDS
                           (COLLECTIVELY, THE "FUNDS")
                          FUNDAMENTAL FIXED INCOME FUND
               (Fundamental U.S. Government Strategic Income Fund)
                       (High-Yield Municipal Bond Series)
                         (Tax-Free Money Market Series)
                            THE CALIFORNIA MUNI FUND
                             FUNDAMENTAL FUNDS, INC.
                              (New York Muni Fund)

               SUPPLEMENT DATED SEPTEMBER 29, 1998 TO EACH FUND'S
                          PROSPECTUS DATED MAY 1, 1998

         The  following  information  supplements  and  supersedes  any contrary
information contained in each Fund's Prospectus.

         At a special  meeting on September 25, 1998,  the Board of Directors of
Fundamental  Funds,  Inc. and the Boards of Trustees of The California Muni Fund
and  Fundamental  Fixed  Income  Fund  (collectively,   the  "Boards")  approved
Cornerstone  Equity  Advisors  Inc.  ("Cornerstone")  as interim  adviser to the
Funds,   effective  September  29,  1998,  pending  Cornerstone's   approval  by
shareholders  as successor  adviser.  Cornerstone,  founded in 1997, is a Nevada
corporation  that  currently  has  approximately  $20  million  of assets  under
management. Cornerstone is located at 67 Wall Street, New York, New York 10005.

         The Funds' assets are being managed by Mr. Stephen Leslie, Chairman and
Chief Executive Officer of Cornerstone. Mr. Leslie has approximately 17 years of
experience  with  fixed-income  securities  and,  specifically,  municipal  bond
portfolios. The interim advisory contracts with Cornerstone were approved by the
Boards  at the same fee rate  that was  established  for  Fundamental  Portfolio
Advisors, Inc. and Tocqueville Asset Management L.P. ("Tocqueville").





         The Boards'  selection of  Cornerstone  resulted from their decision to
abandon the proposed Agreement and Plan of Reorganization (the "Reorganization")
whereby   assets  of  each  of  the  Funds  would  be  transferred  to  separate
newly-created  series of The  Tocqueville  Trust in  exchange  for shares of the
Funds.  The  Boards  considered  several   alternative   investment   management
arrangements  prior to selecting  Cornerstone,  but decided  that  Cornerstone's
selection would be in the best interests of the Funds and their shareholders. 

         In connection with the retention of Cornerstone as interim adviser, the
Boards  also  appointed  Malvina  Capital  Markets  LLC  ("Malvina")  as interim
distributor for three of the Funds (Fundamental U.S. Government Strategic Income
Fund,  High-Yield  Municipal  Bond Series,  and Tax-Free  Money Market  Series),
thereby  replacing  Tocqueville  Securities  L.P.  Malvina,  located  at 67 Wall
Street,  New York, New York 10005, was organized as a New York limited liability
company in 1997. In addition,  the Boards  revoked a prior  resolution  that had
temporarily restricted distribution payments under each Fund's Rule 12b-1 Plan.

         During the special  meeting the Boards  elected Mr.  Leslie to serve as
President of the Funds, replacing Mr. Robert W. Kleinschmidt of Tocqueville. The
Boards  elected Mr. G. John  Fulvio to serve as  Treasurer  and Chief  Financial
Officer of the Funds, replacing Mr. Kieran Lyons of Tocqueville.