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          T. ROWE PRICE
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          TAXABLE FIXED INCOME FUNDS
          Supplement to Prospectuses dated October 1, 1995
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          Effective July 15, 1996, the following paragraph will be added
          under the section "Transaction Procedures and Special
          Requirements" of each Prospectus.

          Small Account Fee
          Because of the disproportionately high costs of servicing
          accounts with low balances, a $10 fee, paid to T. Rowe Price
          Services, the fund's transfer agent, will automatically be
          deducted from nonretirement accounts with balances falling below
          a minimum level. The valuation of accounts and the deduction are
          expected to take place during the last five business days of
          September. The fee will be deducted from accounts with balances
          below $2,000, except for UGMA/UTMA accounts, for which the limit
          is $500. The fee will be waived for any investor whose aggregate
          T. Rowe Price mutual fund investments total $25,000 or more.
          Accounts employing automatic investing (e.g., payroll deduction,
          automatic purchase from a bank account, etc.) are also exempt
          from the charge. The fee will not apply to IRAs and other
          retirement plan accounts. (A separate custodial fee may apply to
          IRAs and other retirement plan accounts.)

          The Taxable Fixed Income Funds consist of the following:
          Corporate Income (prospectus dated October 30, 1995), GNMA, High
          Yield, New Income, Personal Strategy, Prime Reserve, Short-Term
          Bond, Short-Term U.S. Government, and U.S. Treasury Funds.

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          The date of this Supplement is July 15, 1996.
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