Supplement
                             dated August 15, 1997
                      to the Prospectus dated May 1, 1997
                   for the College Retirement Equities Fund's
             Individual, Group and Tax-Deferred Variable Annuities

As a result of recent  legislation,  CREF will no longer be exempt from  federal
income tax under Section 501(a) of the Internal Revenue Code,  beginning January
1, 1998.  We believe  that CREF  should  incur no  material  federal  income tax
liability  as a result  of this  change.  In that  connection, we are  reviewing
whether  any  changes  in  CREF's  corporate   structure  may  be  necessary  or
appropriate in order for CREF to minimize any federal  income tax  consequences.
If needed,  we intend to  implement  any such  changes,  subject  to  regulatory
approval, prior to January 1, 1998.