Rule 497(e)
                                                        Registration No. 2-82143

                           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 June 1, 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.

                  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")  did not  approve the  continuance  of the Funds'
management  agreements  in effect  with  Fundamental  Portfolio  Advisors,  Inc.
("FPA") and, with respect to  Fundamental  Fixed Income Fund,  the  distribution
agreements in effect with Fundamental Service Corporation ("FSC"). Consequently,
these agreements expired on May 31, 1998.

                  On May 30, 1998, at a special joint meeting of the Boards, the
Boards did, however,  approve Tocqueville Asset Management L.P.  ("Tocqueville")
as manager for the Funds on an interim basis,  effective  June 1, 1998,  pending
approval  by  shareholders  of the  Funds  of  permanent  investment  management
arrangements.  The  Funds'  assets  are  being  managed  by Mr.  Drew  Rankin of
Tocqueville,  who is a senior investment  manager with approximately 17 years of
experience  in municipal  bond  portfolios.  Tocqueville  will manage the Funds'
assets at the same fee rates that were paid to FPA.






                  In  connection  with the retention of  Tocqueville  as interim
manager,  the Boards also appointed  Tocqueville  Securities L.P.  ("Tocqueville
Securities"), an affiliate of Tocqueville, as 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 FSC.  Tocqueville
has agreed that, for a period of two years  commencing June 1, 1998, it will not
effect  portfolio  transactions  on behalf of the Funds  through any  affiliated
broker-dealers, including Tocqueville Securities.

                  The Boards also approved the  continuation of the Funds' plans
of  distribution  under Rule 12b-1 of the  Investment  Company  Act of 1940,  as
amended ("12b-1 Plans"). The Boards directed,  however, that no payments be made
by the Funds under the 12b-1 Plans at the present time.

                  The  Boards   approved   amendments  to  the  By-laws  of  The
California Muni Fund and Fundamental  Fixed Income Fund to permit a person other
than a trustee to hold the position as President of The California Muni Fund and
Fundamental  Fixed Income Fund.  In  conjunction  with these  amendments  to the
By-laws, the Boards removed Mr. Vincent J. Malanga as President of the Funds. It
is expected  that  Tocqueville  will  recommend a candidate  to the Boards to be
elected and to serve as President of the Funds.

                  The Boards  elected  Mr. Joe  Neuberger  as  Secretary  of the
Funds. Mr. Neuberger serves as Vice President and Manager of Fund Administration
and Compliance Services at Firstar Trust Company, which serves as Administrator,
Transfer  Agent,  and  Custodian  for the Funds.  

                  On May 27, 1998, in the United States  District  Court for the
Southern  District of New York, the Funds and Mr. James C. Armstrong  sought and
received a temporary





restraining  order preventing FPA, Mr. Vincent J. Malanga,  Mr. Lance M. Brofman
and others from holding a special meeting of  shareholders  scheduled to be held
on May 29,  1998  seeking to replace the current  Board  Members.  The Court has
scheduled a hearing for June 8, 1998 to determine why a  preliminary  injunction
should not be granted.