PROSPECTUS SUPPLEMENT -- June 14, 2004*
        American Express(R) Variable Portfolio Funds S-6466-99 V (10/03)

Effective July 1, 2004, the "Investment Manager" section for AXP Variable
Portfolio - Small Cap Advantage Fund has been revised to add the following
portfolio managers:

Dimitris J. Bertsimas, portfolio manager, became associated with AEFC in August
2002. He has ten years of consulting experience in the asset management
industry. In 1999, he co-founded Dynamic Ideas, LLC, a consulting firm
specializing in the development of quantitative tools for the asset management
industry. He served as managing partner prior to the acquisition of the assets
of Dynamic Ideas, LLC by American Express Financial Advisors Inc. Currently, Dr.
Bertsimas serves as Boeing Professor of Operations Research at the Sloan School
of Management and the Operations Research Center at the Massachusetts Institute
of Technology (MIT), where he has been a member of the faculty since 1988. Dr.
Bertsimas received a BS in electrical engineering and computer science at the
National Technical University of Athens, Greece, a MS in operations research at
MIT, and a Ph.D. in applied mathematics and operations research at MIT. Prior to
December 2002, Dr. Bertsimas had not served as the portfolio manager of a mutual
fund or similar investment vehicle.

Jonathan Calvert, portfolio manager, joined AEFC in 2003. He has more than 10
years of experience in the asset management industry. From 1992 to 2003, Mr.
Calvert worked at Grantham, Mayo, van Otterloo LLC (GMO), where he was a partner
of the firm. During that time, Mr. Calvert worked in quantitative research and
portfolio management for both U.S. and international portfolios. He also
designed the quantitative research environment used throughout GMO's offices. In
his role as Director of Quantitative Trading Research, he focused on cost
measurement and prediction, high frequency return models and optimization for
the equity trades. Mr. Calvert received a Bachelor of Mathematics degree from
the University of Waterloo, Waterloo, Canada.



S-6466-43 A (6/04)

*Valid until next prospectus update
Destroy Oct. 29, 2004