NEW WORLD FUND INC (Form: 485BPOS, Received: 12/29/2005 15:07:14)

SEC File Nos.33-67455

811-9105

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-1A

Registration Statement

Under

the Securities Act of 1933

Post-Effective Amendment No. 11

and

Registration Statement

Under

The Investment Company Act of 1940

Amendment No. 12

NEW WORLD FUND, INC.

(Exact Name of Registrant as specified in charter)

333 South Hope Street

Los Angeles, California 90071

(Address of principal executive offices)

Registrant's telephone number, including area code:

(213) 486-9200

Vincent P. Corti

Capital Research and Management Company

333 South Hope Street

Los Angeles, California 90071

(name and address of agent for service)

Copies to:

Richard M. Phillips, Esq.

Kirkpatrick & Lockhart Nicholson Graham LLP

Four Embarcadero Center

San Francisco, California 94111

(Counsel for the Registrant)

Approximate date of proposed public offering:

It is proposed that this filing become effective on January 1, 2006, pursuant to paragraph (b) of rule 485.

<PAGE>

[logo - American Funds /(R)/] The right choice for the long term/(R)/

New World Fund/SM/

PROSPECTUS

January 1, 2006

TABLE OF CONTENTS

1 Risk/Return summary
5 Fees and expenses of the fund
7 Investment objective, strategies and risks
11 Management and organization
14 Shareholder information
15 Choosing a share class
17 Purchase and exchange of shares
21 Sales charges
25 Sales charge reductions and waivers
27 Rollovers from retirement plans to IRAs
28 Plans of distribution
28 Other compensation to dealers
29 How to sell shares
31 Distributions and taxes
32 Financial highlights

THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED OF
THESE SECURITIES. FURTHER, IT HAS NOT DETERMINED THAT THIS PROSPECTUS IS
ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.

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[This page intentionally left blank.]

<PAGE>

Risk/Return summary

The fund seeks to make your investment grow over time by investing primarily in
stocks of companies with significant exposure to countries with developing
economies and/or markets. The fund may also invest in debt securities of
issuers, including issuers of lower rated bonds, with exposure to these
countries.
The fund is designed for investors seeking capital appreciation. Investors in
the fund should have a long-term perspective and be able to tolerate potentially
wide price fluctuations. Your investment in the fund is subject to risks,
including the possibility that the value of the fund's portfolio holdings may
fluctuate in response to events specific to the companies in which the fund
invests, as well as economic, political or social events in the United States or
abroad. The values of debt securities owned by the fund may be affected by
changing interest rates and credit risk assessments. Lower quality or longer
maturity bonds may be subject to greater price fluctuations than higher quality
or shorter maturity bonds.

Although all securities in the fund's portfolio may be adversely affected by
currency fluctuations or global economic, political or social instability,
securities issued by entities based outside the United States, particularly in
countries with developing economies and/or markets, may be affected to a greater
extent.

Your investment in the fund is not a bank deposit and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency, entity or person.
YOU MAY LOSE MONEY BY INVESTING IN THE FUND. THE LIKELIHOOD OF LOSS MAY BE
GREATER IF YOU INVEST FOR A SHORTER PERIOD OF TIME.

New World Fund / Prospectus
<PAGE>

HISTORICAL INVESTMENT RESULTS
The bar chart below shows how the fund's investment results have varied from
year to year, and the Investment Results table on page 4 shows how the fund's
average annual total returns for various periods compare with different broad
measures of market performance. This information provides some indication of the
risks of investing in the fund. All fund results reflect the reinvestment of
dividends and capital gain distributions, if any. Unless otherwise noted, fund
results reflect any fee waivers and/or expense reimbursements in effect during
the period presented. Past results (before and after taxes) are not predictive
of future results.

CALENDAR YEAR TOTAL RETURNS FOR CLASS A SHARES
(Results do not include a sales charge; if a sales charge were included,
results would be lower.)

[begin bar chart]

2000 -20.90%
2001 -3.96
2002 -4.62
2003 43.36
2004 20.80

[end bar chart]

Highest/Lowest quarterly results during this time period were:

HIGHEST 17.30% (quarter ended June 30, 2003)
LOWEST -18.32% (quarter ended September 30, 2001)

The fund's total return for the nine months ended September 30, 2005, was
17.39%.

New World Fund / Prospectus

<PAGE>

Unlike the bar chart on the previous page, the Investment Results table on the
following page reflects, as required by Securities and Exchange Commission
rules, the fund's investment results with the following maximum initial or
contingent deferred sales charges imposed:

. Class A share results reflect the maximum initial sales charge of 5.75%. This
charge is reduced for purchases of $25,000 or more and eliminated for
purchases of $1 million or more.
. Class B share results reflect the applicable contingent deferred sales
charge. For example, results for the one-year period shown reflect a
contingent deferred sales charge of 5%. These charges begin to decline one
year after purchase and are eliminated six years after purchase.

. Class C share results for the one-year period shown reflect a contingent
deferred sales charge of 1%, which only applies if shares are sold within one
year of purchase.

. Class 529-E and Class F shares are sold without any initial or contingent
deferred sales charge.

Results would be higher if calculated without sales charges. The references
above to Class A, B, C or F sales charges also refer to the corresponding Class
529-A, 529-B, 529-C or 529-F sales charges.
The Investment Results table shows the fund's results on both a pretax and
after-tax basis, as required by Securities and Exchange Commission rules.
After-tax returns are shown only for Class A shares; after-tax returns for other
share classes will vary. Total returns shown "after taxes on distributions"
reflect the effect of taxes on distributions (for example, dividends or capital
gain distributions) by the fund. Total returns shown "after taxes on
distributions and sale of fund shares" assume that you sold your fund shares at
the end of the particular time period and, as a result, reflect the effect of
both taxes on distributions by the fund and taxes on any gain or loss realized
upon the sale of the shares. After-tax returns are calculated using the highest
individual federal income tax rates in effect during each year of the periods
shown and do not reflect the impact of state and local taxes.

YOUR ACTUAL AFTER-TAX RETURNS DEPEND ON YOUR INDIVIDUAL TAX SITUATION AND LIKELY
WILL DIFFER FROM THE RESULTS SHOWN BELOW. IN ADDITION, AFTER-TAX RETURNS MAY NOT
BE RELEVANT IF YOU HOLD YOUR FUND SHARES THROUGH A TAX-DEFERRED ARRANGEMENT,
SUCH AS A 401(K) PLAN, INDIVIDUAL RETIREMENT ACCOUNT (IRA) OR 529 COLLEGE
SAVINGS PLAN, SUCH AS COLLEGEAMERICA./(R)/ CollegeAmerica is sponsored by and is
a registered trademark of the Virginia College Savings Plan,/SM/ an agency of
the Commonwealth of Virginia.

Unlike the Investment Results table on page 4, the Additional Investment Results
table on page 9 reflects the fund's results calculated without sales charges.

New World Fund / Prospectus
<PAGE>

INVESTMENT RESULTS (WITH MAXIMUM SALES CHARGES)
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDED DECEMBER 31, 2004:
1 YEAR 5 YEARS LIFETIME/1/
-------------------------------------------------------------------------------

CLASS A -- FIRST SOLD 6/17/99
Before taxes 13.84% 3.41% 6.68%
After taxes on distributions 13.63 2.91 6.16
After taxes on distributions and sale of fund 9.45 2.66 5.50
shares
-------------------------------------------------------------------------------

1 YEAR LIFETIME/1/
----------------------------------------------------------

CLASS B -- FIRST SOLD 3/15/00
Before taxes 14.87% 3.05%
----------------------------------------------------------
CLASS C -- FIRST SOLD 3/15/01
Before taxes 18.84 12.51
----------------------------------------------------------
CLASS F -- FIRST SOLD 3/16/01
Before taxes 20.75 13.60
----------------------------------------------------------
CLASS 529-A -- FIRST SOLD 2/19/02
Before taxes 13.82 15.49
----------------------------------------------------------
CLASS 529-B -- FIRST SOLD 2/26/02
Before taxes 14.68 15.92
----------------------------------------------------------
CLASS 529-C -- FIRST SOLD 2/25/02
Before taxes 18.68 17.06
----------------------------------------------------------
CLASS 529-E -- FIRST SOLD 3/22/02
Before taxes 20.31 15.45
----------------------------------------------------------
CLASS 529-F -- FIRST SOLD 9/17/02
Before taxes 20.62 27.51

1 YEAR 5 YEARS LIFETIME/1/
---------------------------------------------------------------------

INDEXES (BEFORE TAXES)
MSCI/(R)/ All Country World Index/2/ 15.75% -1.79% 0.97%
MSCI Emerging Markets Index/3/ 25.95 4.62 7.48

1 Lifetime results for each share class are measured from the date the share
class was first sold. Lifetime results for the index(es) shown are measured
from the date Class A shares were first sold.
2 MSCI All Country World Index is a free float-adjusted market capitalization
index that is designed to measure equity market performance in the global
developed and emerging markets, consisting of 49 developed and emerging market
country indexes. This index is unmanaged and includes reinvested dividends
and/or distributions, but does not reflect sales charges, commissions, expenses
or taxes.
3 MSCI Emerging Markets Index is a free float-adjusted market capitalization
index that is designed to measure equity market performance in the global
emerging markets, consisting of 26 emerging market country indexes. This index
is unmanaged and includes reinvested dividends and/or distributions, but does
not reflect sales charges, commissions, expenses or taxes.

New World Fund / Prospectus

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Fees and expenses of the fund

These tables describe the fees and expenses that you may pay if you buy and hold
shares of the fund.

SHAREHOLDER FEES (PAID DIRECTLY FROM YOUR INVESTMENT)
CLASS A/1/ CLASS B/1/ CLASS C/1/ CLASS 529-E/2/ CLASS F/1/,/3/
--------------------------------------------------------------------------------------------

Maximum initial sales
charge on purchases 5.75%/4/ none none none none
(as a percentage of
offering price)
--------------------------------------------------------------------------------------------
Maximum sales charge none none none none none
on reinvested
dividends
--------------------------------------------------------------------------------------------
Maximum contingent none/5/ 5.00%/6/ 1.00%/7/ none none
deferred sales charge
--------------------------------------------------------------------------------------------
Redemption or none none none none none
exchange fees

1 Includes a version of this class offered through CollegeAmerica.
CollegeAmerica accounts are subject to a $10 account setup fee and an annual
$10 account maintenance fee, which are not reflected in this table.
2 Class 529-E shares are available only through CollegeAmerica to
employer-sponsored plans. CollegeAmerica accounts are subject to a $10 account
setup fee and an annual $10 account maintenance fee, which are not reflected in
this table.
3 Class F and 529-F shares are generally available only to fee-based programs of
investment dealers that have special agreements with the fund's distributor and
to certain registered investment advisers.
4 The initial sales charge is reduced for purchases of $25,000 or more and
eliminated for purchases of $1 million or more.
5 A contingent deferred sales charge of 1.00% applies on certain redemptions
made within one year following purchases of $1 million or more made without an
initial sales charge.
6 The contingent deferred sales charge is reduced one year after purchase and
eliminated six years after purchase.
7 The contingent deferred sales charge is eliminated one year after purchase.

ANNUAL FUND OPERATING EXPENSES (DEDUCTED FROM FUND ASSETS)
CLASS A CLASS B CLASS C CLASS F
-------------------------------------------------------------------------------

Management fees/8/ 0.69% 0.69% 0.69% 0.69%
-------------------------------------------------------------------------------
Distribution and/or service 0.26 1.00 1.00 0.25
(12b-1) fees/9/
-------------------------------------------------------------------------------
Other expenses/10/ 0.23 0.25 0.29 0.25
-------------------------------------------------------------------------------
Total annual fund operating 1.18 1.94 1.98 1.19
expenses/8/
CLASS CLASS CLASS CLASS CLASS
529-A 529-B 529-C 529-E 529-F
-------------------------------------------------------------------------------
Management fees/8/ 0.69% 0.69% 0.69% 0.69% 0.69%
-------------------------------------------------------------------------------
Distribution and/or service 0.17 1.00 1.00 0.50 0.12
(12b-1) fees/11/
-------------------------------------------------------------------------------
Other expenses/10/,/12/ 0.35 0.40 0.39 0.36 0.36
-------------------------------------------------------------------------------
Total annual fund operating 1.21 2.09 2.08 1.55 1.17
expenses/8/

8 The fund's investment adviser began waiving 5% of its management fees on
September 1, 2004. Beginning April 1, 2005, this waiver increased to 10% and is
expected to continue at this level until further review. Total annual fund
operating expenses do not reflect any waiver. Information regarding the effect
of any waiver on total annual fund operating expenses can be found in the
Financial Highlights table and the audited financial statements in the fund's
annual report.
9 Class A and F 12b-1 fees may not exceed .30% and .50%, respectively, of each
class' average net assets annually. Class B and C 12b-1 fees are up to 1.00% of
each class' average net assets annually.
10 Includes custodial, legal, transfer agent and subtransfer agent/recordkeeping
payments and various other expenses. Subtransfer agent/recordkeeping payments
may be made to third parties (including affiliates of the fund's investment
adviser) that provide subtransfer agent, recordkeeping and/or shareholder
services with respect to certain shareholder accounts in lieu of the transfer
agent providing such services. The amount paid for subtransfer
agent/recordkeeping services will vary depending on the share class and
services provided, and typically ranges from $3 to $19 per account.
11 Class 529-A and 529-F 12b-1 fees may not exceed .50% of each class' average
net assets annually. Class 529-B and 529-C 12b-1 fees are up to 1.00% of each
class' average net assets annually. Class 529-E 12b-1 fees may not exceed .75%
of the class' average net assets annually.
12 Includes .10% paid to the Virginia College Savings Plan for administrative
services it provides in overseeing CollegeAmerica.

New World Fund / Prospectus
<PAGE>

EXAMPLES

The examples below are intended to help you compare the cost of investing in the
fund with the cost of investing in other mutual funds. The examples assume that
you invest $10,000 in the fund for the time periods indicated, that your
investment has a 5% return each year, that all dividends and capital gain
distributions are reinvested, and that the fund's operating expenses remain the
same as shown above. The examples do not reflect the impact of any fee waivers
or expense reimbursements. The examples assuming redemption do not reflect the
effect of any taxable gain or loss at the time of the redemption.

Although your actual costs may be higher or lower, based on these assumptions,
your cumulative estimated expenses would be:

1 YEAR 3 YEARS 5 YEARS 10 YEARS
-------------------------------------------------------------------------------

Class A/1/ $688 $ 928 $1,187 $1,924
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Class B -- assuming redemption/2/ 697 1,009 1,247 2,067
-------------------------------------------------------------------------------
Class B -- assuming no redemption/3/ 197 609 1,047 2,067
-------------------------------------------------------------------------------
Class C -- assuming redemption/4/ 301 621 1,068 2,306
-------------------------------------------------------------------------------
Class C -- assuming no redemption 201 621 1,068 2,306
-------------------------------------------------------------------------------
Class F -- excludes intermediary fees/5/ 121 378 654 1,443
-------------------------------------------------------------------------------
Class 529-A/1/,/6/ 711 976 1,260 2,058
-------------------------------------------------------------------------------
Class 529-B -- assuming 732 1,093 1,380 2,294
redemption/2/,/6/
-------------------------------------------------------------------------------
Class 529-B -- assuming no 232 693 1,180 2,294
redemption/3/,/6/
-------------------------------------------------------------------------------
Class 529-C -- assuming 331 690 1,175 2,507
redemption/4/,/6/
-------------------------------------------------------------------------------
Class 529-C -- assuming no redemption/6/ 231 690 1,175 2,507
-------------------------------------------------------------------------------
Class 529-E/6/ 177 528 902 1,945
-------------------------------------------------------------------------------
Class 529-F -- excludes intermediary 139 411 701 1,522
fees/5/,/6/

1 Reflects the maximum initial sales charge in the first year.
2 Reflects applicable contingent deferred sales charges through year six and
Class A or 529-A expenses for years nine and 10 because Class B and 529-B
shares automatically convert to Class A and 529-A shares, respectively, after
eight years.
3 Reflects Class A or 529-A expenses for years nine and 10 because Class B and
529-B shares automatically convert to Class A and 529-A shares, respectively,
after eight years.
4 Reflects a contingent deferred sales charge in the first year.
5 Does not include fees charged by financial intermediaries, which are
independent of fund expenses and will increase the overall cost of your
investment. Intermediary fees typically range from .75% to 1.50% of assets
annually depending on the services offered.
6 Reflects an initial $10 account setup fee and an annual $10 CollegeAmerica
account maintenance fee.

New World Fund / Prospectus

<PAGE>

Investment objective, strategies and risks

The fund's investment objective is long-term capital appreciation. The fund may
invest in equity securities of any company, regardless of where it is based, if
the fund's investment adviser determines that a significant portion of the
company's assets or revenues (generally 20% or more) is attributable to
developing countries. Under normal market conditions, the fund will invest at
least 35% of its assets in equity and debt securities of issuers primarily based
in qualified countries that have developing economies and/or markets. In
addition, the fund may invest up to 25% of its assets in nonconvertible debt
securities of issuers, including issuers of lower rated bonds and government
bonds, primarily based in qualified countries or that have a significant portion
of their assets or revenues attributable to developing countries. The fund may
also, to a limited extent, invest in securities of issuers based in nonqualified
developing countries.

In determining whether a country is qualified, the fund will consider such
factors as the country's per capita gross domestic product, the percentage of
the country's economy that is industrialized, market capital as a percentage of
gross domestic product, the overall regulatory environment, the presence of
government regulation limiting or banning foreign ownership, and restrictions on
repatriation of initial capital, dividends, interest and/or capital gains. The
fund's investment adviser will maintain a list of qualified countries and
securities in which the fund may invest. Qualified developing countries in which
the fund may invest currently include, but are not limited to, Argentina,
Brazil, Chile, China, Colombia, Croatia, Czech Republic, Dominican Republic,
Egypt, Hungary, India, Israel, Jordan, Malaysia, Mexico, Morocco, Panama, Peru,
Philippines, Poland, Russian Federation, South Africa, Thailand, Turkey and
Venezuela.

The prices of securities held by the fund may decline in response to certain
events, including those directly involving the companies whose securities are
owned by the fund; conditions affecting the general economy; overall market
changes; local, regional or global political, social or economic instability;
and currency and interest rate fluctuations. The growth-oriented, equity-type
securities generally purchased by the fund may involve large price swings and
potential for loss, particularly in the case of smaller capitalization stocks.
Smaller capitalization stocks are often more difficult to value or dispose of,
more difficult to obtain information about and more volatile than stocks of
larger, more established companies.

The values of most debt securities held by the fund may be affected by changing
interest rates and by changes in the effective maturities and credit ratings of
these securities. For example, the values of debt securities in the fund's
portfolio generally will decline when interest rates rise and increase when
interest rates fall. In addition, falling interest rates may cause an issuer to
redeem or "call" a security before its stated maturity, which may result in the
fund having to reinvest the proceeds in lower yielding securities. Debt
securities are also subject to credit risk, which is the possibility that the
credit strength of an issuer will weaken and/or an issuer of a debt security
will fail to make timely payments of

New World Fund / Prospectus
<PAGE>

principal or interest and the security will go into default. Lower quality or
longer maturity debt securities generally have higher rates of interest and may
be subject to greater price fluctuations than higher quality or shorter maturity
debt securities. The fund's investment adviser attempts to reduce these risks
through diversification of the portfolio and with ongoing credit analysis of
each issuer, as well as by monitoring economic and legislative developments.

Investments in securities issued by entities based outside the United States may
be subject to the risks described above to a greater extent and may also be
affected by currency controls; different accounting, auditing, financial
reporting and legal standards and practices in some countries; expropriation;
changes in tax policy; greater market volatility; differing securities market
structures; higher transaction costs; and various administrative difficulties,
such as delays in clearing and settling portfolio transactions or in receiving
payment of dividends. These risks may be heightened in connection with
investments in developing countries.

Investing in countries with developing economies and/or markets may involve
risks in addition to and greater than those generally associated with investing
in developed countries. For instance, developing countries may have less
developed legal and accounting systems. The governments of these countries may
be more unstable and more likely to impose capital controls, nationalize a
company or industry, place restrictions on foreign ownership and on withdrawing
sale proceeds of securities from the country, and/or impose punitive taxes that
could adversely affect security prices. In addition, the economies of these
countries may be dependent on relatively few industries that are more
susceptible to local and global changes. Securities markets in these countries
are also relatively small and have substantially lower trading volumes. As a
result, securities issued in these countries may be more volatile and less
liquid than securities issued in countries with more developed economies or
markets.
The fund may also hold cash or money market instruments. The percentage of the
fund invested in such holdings will vary and depends on various factors,
including market conditions and purchases and redemptions of fund shares. A
larger percentage of such holdings could moderate the fund's investment results
in a period of rising market prices; conversely, it could reduce the magnitude
of the fund's loss in the event of falling market prices and provide liquidity
to make additional investments or to meet redemptions.

The fund relies on the professional judgment of its investment adviser to make
decisions about the fund's portfolio investments. The basic investment
philosophy of the investment adviser is to seek to invest in attractively valued
companies that, in its opinion, represent above-average long-term investment
opportunities. The investment adviser believes that an important way to
accomplish this is through fundamental analysis, which may include meeting with
company executives and employees, suppliers, customers and competitors.
Securities may be sold when the investment adviser believes that they no longer
represent relatively attractive investment opportunities.

New World Fund / Prospectus

<PAGE>

ADDITIONAL INVESTMENT RESULTS
Unlike the Investment Results table on page 4, the table below reflects the
fund's results calculated without sales charges.

ADDITIONAL INVESTMENT RESULTS (WITHOUT SALES CHARGES)
AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDED DECEMBER 31, 2004:
1 YEAR 5 YEARS LIFETIME/1/
-------------------------------------------------------------------------------

CLASS A -- FIRST SOLD 6/17/99
Before taxes 20.80% 4.64% 7.82%
After taxes on distributions 20.57 4.14 7.30
After taxes on distributions and sale of fund 14.00 3.73 6.51
shares
-------------------------------------------------------------------------------

1 YEAR LIFETIME/1/
----------------------------------------------------------

CLASS B -- FIRST SOLD 3/15/00
Before taxes 19.87% 3.41%
----------------------------------------------------------
CLASS C -- FIRST SOLD 3/15/01
Before taxes 19.84 12.51
----------------------------------------------------------
CLASS F -- FIRST SOLD 3/16/01
Before taxes 20.75 13.60
----------------------------------------------------------
CLASS 529-A -- FIRST SOLD 2/19/02
Before taxes 20.74 17.90
----------------------------------------------------------
CLASS 529-B -- FIRST SOLD 2/26/02
Before taxes 19.68 16.98
----------------------------------------------------------
CLASS 529-C -- FIRST SOLD 2/25/02
Before taxes 19.68 17.06
----------------------------------------------------------
CLASS 529-E -- FIRST SOLD 3/22/02
Before taxes 20.31 15.45
----------------------------------------------------------
CLASS 529-F -- FIRST SOLD 9/17/02
Before taxes 20.62 27.51
----------------------------------------------------------

1 YEAR 5 YEARS LIFETIME/1/
-------------------------------------------------------------------

INDEXES (BEFORE TAXES)
MSCI All Country World Index/2/ 15.75% -1.79% 0.97%
MSCI Emerging Markets Index/3/ 25.95 4.62 7.48

New World Fund / Prospectus
<PAGE>

[Begin pie chart]

Industry diversification as of October 31, 2005

Financials 16.21%
Bonds & notes 10.71
Telecommunication Services10.36
Consumer Staples 8.62
Materials 7.75
Consumer Discretionary 6.77
Other industries 26.51
Short-term securtities and
other assets less liabilities 13.07

[End pie chart]

Because the fund is actively managed, its holdings will change over time.

For updated information on the fund's portfolio holdings, please visit us at
americanfunds.com.

New World Fund / Prospectus

<PAGE>

Management and organization

INVESTMENT ADVISER

Capital Research and Management Company, an experienced investment management
organization founded in 1931, serves as investment adviser to the fund and other
funds, including the American Funds. Capital Research and Management Company is
a wholly owned subsidiary of The Capital Group Companies, Inc. and is located at
333 South Hope Street, Los Angeles, California 90071, and 135 South State
College Boulevard, Brea, California 92821. Capital Research and Management
Company manages the investment portfolio and business affairs of the fund. The
total management fee paid by the fund, as a percentage of average net assets,
for the previous fiscal year appears in the Annual Fund Operating Expenses table
under "Fees and expenses of the fund." A discussion regarding the basis for the
approval of the fund's investment advisory and service agreement by the fund's
Board of Directors is contained in the fund's semi-annual report to shareholders
for the period ended April 30, 2005.

EXECUTION OF PORTFOLIO TRANSACTIONS

The investment adviser places orders with broker-dealers for the fund's
portfolio transactions. The investment adviser strives to obtain best execution
for the fund's portfolio transactions, taking into account a variety of factors
to produce the most favorable total price reasonably attainable under the
circumstances. These factors include the size and type of transaction, the cost
and quality of executions, and the broker-dealer's ability to offer liquidity
and anonymity. For example, with respect to equity transactions, the fund does
not consider the investment adviser as having an obligation to obtain the lowest
available commission rate to the exclusion of price, service and qualitative
considerations. Subject to the considerations outlined above, the investment
adviser may place orders for the fund's portfolio transactions with
broker-dealers who have sold shares of funds managed by the investment adviser,
or who have provided investment research, statistical or other related services
to the investment adviser. In placing orders for the fund's portfolio
transactions, the investment adviser does not commit to any specific amount of
business with any particular broker-dealer. Subject to best execution, the
investment adviser may consider investment research, statistical or other
related services provided to the adviser in placing orders for the fund's
portfolio transactions. However, when the investment adviser places orders for
the fund's portfolio transactions, it does not give any consideration to whether
a broker-dealer has sold shares of the funds managed by the investment adviser.

PORTFOLIO HOLDINGS

Portfolio holdings information for the fund is available on the American Funds
website at americanfunds.com. To reach this information, access the lower
portion of the fund's details page on the website. A list of the fund's top 10
equity holdings updated as of each month-end is generally posted to this page
within 14 days after the end of the applicable

New World Fund / Prospectus
<PAGE>

month. A link to the fund's complete list of publicly disclosed portfolio
holdings updated as of each calendar quarter-end is generally posted to this
page within 45 days after the end of the applicable quarter. Both lists remain
available on the website until new information for the next month or quarter is
posted. Portfolio holdings information for the fund is also contained in reports
filed with the Securities and Exchange Commission.

A description of the fund's policies and procedures regarding disclosure of
information about its portfolio holdings is available in the statement of
additional information.

MULTIPLE PORTFOLIO COUNSELOR SYSTEM

Capital Research and Management Company uses a system of multiple portfolio
counselors in managing mutual fund assets. Under this approach, the portfolio of
a fund is divided into segments managed by individual counselors. Counselors
decide how their respective segments will be invested. In addition, Capital
Research and Management Company's investment analysts may make investment
decisions with respect to a portion of a fund's portfolio. Investment decisions
are subject to the limits provided by a fund's objective(s), policies and
restrictions and the oversight of Capital Research and Management Company's
investment committee.

The primary individual portfolio counselors for New World Fund are:

PRIMARY TITLE WITH PORTFOLIO
PORTFOLIO INVESTMENT ADVISER COUNSELOR'S
PORTFOLIO COUNSELOR/ COUNSELOR (OR AFFILIATE) ROLE IN
FUND TITLE EXPERIENCE AND INVESTMENT MANAGEMENT
(IF APPLICABLE) IN THIS FUND EXPERIENCE OF THE FUND
--------------------------------------------------------------------------------------

ROBERT W. LOVELACE 7 years Senior Vice Serves as an equity
President and President, Capital securities portfolio
Director Research and counselor
Management Company

Investment
professional for 21
years, all with
Capital Research and
Management Company or
affiliate
--------------------------------------------------------------------------------------
MARK E. DENNING 7 years Director, Capital Serves as an equity
Senior Vice President Research and securities portfolio
Management Company counselor

Investment
professional for 23
years, all with
Capital Research and
Management Company or
affiliate
--------------------------------------------------------------------------------------
DAVID C. BARCLAY 7 years Senior Vice Serves as a
Vice President President, Capital fixed-income securities
Research and portfolio counselor
Management Company

Investment
professional for 25
years in total; 18
years with Capital
Research and
Management Company or
affiliate
--------------------------------------------------------------------------------------
ALWYN HEONG 7 years Senior Vice Serves as an equity
Vice President President, Capital securities portfolio
Research Company counselor

Investment
professional for 17
years in total; 13
years with Capital
Research and
Management Company or
affiliate
--------------------------------------------------------------------------------------
CARL M. KAWAJA 7 years Senior Vice Serves as an equity
Vice President President, Capital securities portfolio
Research Company counselor

Investment
professional for 18
years in total; 15
years with Capital
Research and
Management Company or
affiliate
--------------------------------------------------------------------------------------

New World Fund / Prospectus

<PAGE>

Information regarding the portfolio counselors' compensation, their ownership of
securities in the fund and other accounts they manage can be found in the
statement of additional information.

New World Fund / Prospectus
<PAGE>

Shareholder information

SHAREHOLDER SERVICES

American Funds Service Company, the fund's transfer agent, offers a wide range
of services that you can use to alter your investment program should your needs
and circumstances change. These services may be terminated or modified at any
time upon 60 days' written notice. For your convenience, American Funds Service
Company has four service centers across the country.

AMERICAN FUNDS SERVICE COMPANY SERVICE AREAS
Call toll-Free from anywhere in the United States
(8 a.m. to 8 p.m. ET): 800/421-0180
Access the American Funds website : americanfunds.com

[map of the United States]

Western Western Central Eastern Central Eastern
service center service center service center service center
American Funds American Funds American Funds American Funds
Service Company Service Company Service Company Service Company
P.O. Box 25065 P.O. Box 659522 P.O. Box 6007 P.O. Box 2280
Santa Ana, San Antonio, Texas Indianapolis, Indiana Norfolk, Virginia
California 78265-9522 46206-6007 23501-2280
92799-5065 Fax: 210/474-4352 Fax: 317/735-6636 Fax: 757/670-4761
Fax: 714/671-7133

A MORE DETAILED DESCRIPTION OF POLICIES AND SERVICES IS INCLUDED IN THE FUND'S
STATEMENT OF ADDITIONAL INFORMATION AND THE OWNER'S GUIDE SENT TO NEW AMERICAN
FUNDS SHAREHOLDERS ENTITLED WELCOME. CLASS 529 SHAREHOLDERS SHOULD ALSO REFER TO
THE COLLEGEAMERICA PROGRAM DESCRIPTION FOR INFORMATION ON POLICIES AND SERVICES
SPECIFICALLY RELATING TO THEIR COLLEGEAMERICA ACCOUNT(S). These documents are
available by writing or calling American Funds Service Company. Certain
privileges and/or services may not be available to you depending on your
investment dealer. Please see your financial adviser or investment dealer for
more information.

New World Fund / Prospectus

<PAGE>

Choosing a share class

The fund offers different classes of shares through this prospectus. Class A, B,
C and F shares may be purchased through various investment programs or accounts,
including certain types of retirement plans (see limitations below). The
services or share classes available to you may vary depending upon how you wish
to purchase shares of the fund.

Investors residing in any state may purchase Class 529-A, 529-B, 529-C, 529-E
and 529-F shares through an account established with CollegeAmerica. Class
529-A, 529-B, 529-C and 529-F shares are structured similarly to the
corresponding Class A, B, C and F shares. For example, the same initial sales
charges apply to Class 529-A shares as to Class A shares. Class 529-E shares are
available only to investors participating in CollegeAmerica through an eligible
employer plan.

Each share class represents investment in the same portfolio of securities, but
each class has its own sales charge and expense structure, allowing you to
choose the class that best fits your situation. WHEN YOU PURCHASE SHARES OF THE
FUND, YOU MUST CHOOSE A SHARE CLASS. IF NONE IS CHOSEN, YOUR INVESTMENT WILL BE
MADE IN CLASS A SHARES OR, IN THE CASE OF A COLLEGEAMERICA INVESTMENT, CLASS
529-A SHARES.

Factors you should consider in choosing a class of shares include:

. how long you expect to own the shares;

. how much you intend to invest;

. total expenses associated with owning shares of each class;

. whether you qualify for any reduction or waiver of sales charges (for
example, Class A or 529-A shares may be a less expensive option over time,
particularly if you qualify for a sales charge reduction or waiver);

. whether you plan to take any distributions in the near future (for example,
the contingent deferred sales charge will not be waived if you sell your Class
529-B or 529-C shares to cover higher education expenses);

. availability of share classes:

-- Class B and C shares are not available to retirement plans that do not
currently invest in such shares and are eligible to invest in Class R shares,
including employer-sponsored retirement plans such as defined benefit plans,
401(k) plans, 457 plans, employer-sponsored 403(b) plans, and money purchase
pension and profit-sharing plans; and

-- Class F and 529-F shares are generally available only to fee-based programs
of investment dealers that have special agreements with the fund's
distributor and to certain registered investment advisers.

EACH INVESTOR'S FINANCIAL CONSIDERATIONS ARE DIFFERENT. YOU SHOULD SPEAK WITH
YOUR FINANCIAL ADVISER TO HELP YOU DECIDE WHICH SHARE CLASS IS BEST FOR YOU.

UNLESS OTHERWISE NOTED, REFERENCES IN THE FOLLOWING PAGES TO CLASS A, B, C OR F
SHARES ALSO REFER TO THE CORRESPONDING CLASS 529-A, 529-B, 529-C OR 529-F
SHARES.

New World Fund / Prospectus
<PAGE>

SUMMARY OF THE PRIMARY DIFFERENCES AMONG SHARE CLASSES
CLASS A SHARES

Initial sales charge up to 5.75% (reduced for purchases of $25,000 or more
and eliminated for purchases of $1 million or more)
Contingent deferred none (except that a charge of 1.00% applies to certain
sales charge redemptions made within one year following purchases
of $1 million or more without an initial sales charge)
12b-1 fees up to .30% annually (for 529-A shares, may not exceed
.50% annually)
Dividends generally higher than other classes due to lower
annual expenses
Purchase maximum none
Conversion none
CLASS B SHARES
Initial sales charge none
Contingent deferred starts at 5.00%, declining to 0% six years after
sales charge purchase
12b-1 fees up to 1.00% annually
Dividends generally lower than A and F shares due to higher
12b-1 fees and other expenses, but higher than C
shares due to lower other expenses
Purchase maximum see the discussion regarding purchase minimums and
maximums in "Purchase and exchange of shares"
Conversion automatic conversion to A or 529-A shares after eight
years, reducing future annual expenses
CLASS C SHARES
Initial sales charge none
Contingent deferred 1.00% if shares are sold within one year after
sales charge purchase
12b-1 fees up to 1.00% annually
Dividends generally lower than other classes due to higher 12b-1
fees and other expenses
Purchase maximum see the discussion regarding purchase minimums and
maximums in "Purchase and exchange of shares"
Conversion automatic conversion to F shares after 10 years,
reducing future annual expenses (529-C shares will not
convert to 529-F shares)
CLASS 529-E SHARES
Initial sales charge none
Contingent deferred none
sales charge
12b-1 fees currently up to .50% annually (may not exceed .75%
annually)
Dividends generally higher than 529-B and 529-C shares due to
lower 12b-1 fees, but lower than 529-A and 529-F
shares due to higher 12b-1 fees
Purchase maximum none
Conversion none
CLASS F SHARES
Initial sales charge none
Contingent deferred none
sales charge
12b-1 fees currently up to .25% annually (may not exceed .50%
annually)
Dividends generally higher than B and C shares due to lower
12b-1 fees, but lower than A shares due to higher
other expenses
Purchase maximum none
Conversion none

New World Fund / Prospectus

<PAGE>

Purchase and exchange of shares

THE FUND'S TRANSFER AGENT, ON BEHALF OF THE FUND AND AMERICAN FUNDS
DISTRIBUTORS, THE FUND'S DISTRIBUTOR, IS REQUIRED BY LAW TO OBTAIN CERTAIN
PERSONAL INFORMATION FROM YOU OR ANY OTHER PERSON(S) ACTING ON YOUR BEHALF IN
ORDER TO VERIFY YOUR OR SUCH PERSON'S IDENTITY. IF YOU DO NOT PROVIDE THE
INFORMATION, THE TRANSFER AGENT MAY NOT BE ABLE TO OPEN YOUR ACCOUNT. IF THE
TRANSFER AGENT IS UNABLE TO VERIFY YOUR IDENTITY OR THAT OF ANY OTHER PERSON(S)
AUTHORIZED TO ACT ON YOUR BEHALF, OR BELIEVES IT HAS IDENTIFIED POTENTIALLY
CRIMINAL ACTIVITY, THE FUND AND AMERICAN FUNDS DISTRIBUTORS RESERVE THE RIGHT TO
CLOSE YOUR ACCOUNT OR TAKE SUCH OTHER ACTION THEY DEEM REASONABLE OR REQUIRED BY
LAW.

PURCHASE OF CLASS A, B AND C SHARES

You may generally open an account and purchase Class A, B and C shares by
contacting any financial adviser (who may impose transaction charges in addition
to those described in this prospectus) authorized to sell the fund's shares. You
may purchase additional shares in various ways, including through your financial
adviser and by mail, telephone, the Internet and bank wire.

PURCHASE OF CLASS F SHARES

You may generally open an account and purchase Class F shares only through
fee-based programs of investment dealers that have special agreements with the
fund's distributor and through certain registered investment advisers. These
dealers and advisers typically charge ongoing fees for services they provide.

PURCHASE OF CLASS 529 SHARES

Class 529 shares may be purchased only through a CollegeAmerica account. You may
open a CollegeAmerica account and purchase 529 shares by contacting any
financial adviser (who may impose transaction charges in addition to those
described in this prospectus) authorized to sell a CollegeAmerica account. You
may purchase additional shares in various ways, including through your financial
adviser and by mail, telephone, the Internet and bank wire.

Class 529-E shares may be purchased only by employees participating in
CollegeAmerica through an eligible employer plan.

EXCHANGE

Generally, you may exchange your shares into shares of the same class of other
American Funds without a sales charge. Class A, C or F shares may generally be
exchanged into the corresponding 529 share class without a sales charge. Class B
shares may not be exchanged into Class 529-B shares. EXCHANGES FROM CLASS A, C
OR F SHARES TO THE CORRESPONDING 529 SHARE CLASS, PARTICULARLY IN THE CASE OF
UNIFORM GIFTS TO MINORS ACT OR

New World Fund / Prospectus
<PAGE>

UNIFORM TRANSFER TO MINORS ACT CUSTODIAL ACCOUNTS, MAY RESULT IN SIGNIFICANT
LEGAL AND TAX CONSEQUENCES AS DESCRIBED IN THE COLLEGEAMERICA PROGRAM
DESCRIPTION. PLEASE CONSULT YOUR FINANCIAL ADVISER BEFORE MAKING SUCH AN
EXCHANGE.

Exchanges of shares from American Funds money market funds initially purchased
without a sales charge generally will be subject to the appropriate sales
charge. For purposes of computing the contingent deferred sales charge on Class
B and C shares, the length of time you have owned your shares will be measured
from the date of original purchase and will not be affected by any permitted
exchange.

Exchanges have the same tax consequences as ordinary sales and purchases. For
example, to the extent you exchange shares held in a taxable account that are
worth more now than what you paid for them, the gain will be subject to
taxation. See "Transactions by telephone, fax or the Internet" for information
regarding electronic exchanges.

FREQUENT TRADING OF FUND SHARES

The fund and American Funds Distributors reserve the right to reject any
purchase order for any reason. The fund is not designed to serve as a vehicle
for frequent trading in response to short-term fluctuations in the securities
markets. Accordingly, purchases, including those that are part of exchange
activity, that the fund or American Funds Distributors has determined could
involve actual or potential harm to the fund may be rejected. Frequent trading
of fund shares may lead to increased costs to the fund and less efficient
management of the fund's portfolio, resulting in dilution of the value of the
shares held by long-term shareholders.

The fund's Board of Directors has adopted policies and procedures with respect
to frequent purchases and redemptions of fund shares. Under the fund's "purchase
blocking policy," any shareholder redeeming shares (including redemptions that
are part of an exchange transaction) having a value of $5,000 or more from the
fund will be precluded from investing in the fund (including investments that
are part of an exchange transaction) for 30 calendar days after the redemption
transaction. This prohibition will not apply to redemptions by shareholders
whose shares are held on the books of third-party intermediaries that have not
adopted procedures to implement this policy. American Funds Service Company will
work with intermediaries to develop such procedures or other procedures that
American Funds Service Company determines are reasonably designed to achieve the
objective of the purchase blocking policy. At the time the intermediaries adopt
these procedures, shareholders whose accounts are on the books of such
intermediaries will be subject to this purchase blocking policy or another
frequent trading policy that achieves the objective of the purchase blocking
policy. There is no guarantee that all instances of frequent trading in fund
shares will be prevented.

Under the fund's purchase blocking policy, certain purchases will not be
prevented and certain redemptions will not trigger a purchase block, such as:
systematic redemptions and purchases where the entity maintaining the
shareholder account is able to identify the

New World Fund / Prospectus

<PAGE>

transaction as a systematic redemption or purchase; purchases and redemptions of
shares having a value of less than $5,000; retirement plan contributions, loans
and distributions (including hardship withdrawals) identified as such on the
retirement plan recordkeeper's system; and purchase transactions involving
transfers of assets, rollovers, Roth IRA conversions and IRA
re-characterizations, where the entity maintaining the shareholder account is
able to identify the transaction as one of these types of transactions. The
statement of additional information contains more information about how American
Funds Service Company may address other potentially abusive trading activity in
the American Funds.

PURCHASE MINIMUMS AND MAXIMUMS

PURCHASE MINIMUMS FOR ALL CLASSES OF SHARES
-------------------------------------------------------------------------------

To establish an account (including retirement plan and $ 250
CollegeAmerica accounts)
With an automatic investment plan 50
For a retirement plan account through payroll deduction* 25
or an employer-sponsored CollegeAmerica account
To add to an account 50
For a retirement plan account through payroll deduction* 25
or an employer-sponsored CollegeAmerica account
-------------------------------------------------------------------------------
PURCHASE MAXIMUM PER TRANSACTION FOR CLASS B SHARES 50,000
-------------------------------------------------------------------------------
PURCHASE MAXIMUM PER TRANSACTION FOR CLASS C SHARES 500,000

* Purchase minimums for retirement plan accounts purchasing through payroll
deduction may be waived to allow for diversification of plan participant
investment assets.

Due to the current maximum contribution limit for a CollegeAmerica account, the
effective purchase maximums for Class 529-A, 529-C, 529-E and 529-F shares are
each $250,000. See the CollegeAmerica Program Description for more information.

If you have significant American Funds or American Legacy/(R)/ holdings, you may
not be eligible to invest in Class B or C shares (or their corresponding 529
share classes). Specifically, you may not purchase Class B or 529-B shares if
you are eligible to purchase Class A or 529-A shares at the $100,000 or higher
sales charge discount rate, and you may not purchase Class C or 529-C shares if
you are eligible to purchase Class A or 529-A shares at the $1 million or more
sales charge discount rate (i.e., at net asset value). See "Sales charge
reductions and waivers" below and the statement of additional information for
more information regarding sales charge discounts.

VALUING SHARES

The net asset value of each share class of the fund is the value of a single
share. The fund calculates the net asset value each day the New York Stock
Exchange is open as of approximately 4:00 p.m. New York time, the normal close
of regular trading. Assets are valued primarily on the basis of market
quotations. However, the fund has adopted procedures for making "fair value"
determinations if market quotations are not readily available or are not
considered reliable. For example, if events occur between the close of markets
outside the

New World Fund / Prospectus
<PAGE>

United States and the close of regular trading on the New York Stock Exchange
that, in the opinion of the investment adviser, materially affect the value of
the fund's securities that principally trade in those international markets, the
securities will be valued in accordance with fair value procedures. Use of these
procedures is intended to result in more appropriate net asset values. In
addition, such use will reduce, if not eliminate, potential arbitrage
opportunities otherwise available to short-term investors.

Because the fund may hold securities that are primarily listed on foreign
exchanges that trade on weekends or days when the fund does not price its
shares, the value of securities held in the fund may change on days when you
will not be able to purchase or redeem fund shares.

Your shares will be purchased at the net asset value (plus any applicable sales
charge in the case of Class A shares) or sold at the net asset value next
determined after American Funds Service Company receives and accepts your
request. A contingent deferred sales charge may apply at the time you sell
certain Class A, B and C shares.

New World Fund / Prospectus

<PAGE>

Sales charges

CLASS A SHARES

The initial sales charge you pay each time you buy Class A shares differs
depending upon the amount you invest and may be reduced or eliminated for larger
purchases as indicated below. The "offering price," the price you pay to buy
shares, includes any applicable sales charge, which will be deducted directly
from your investment. Shares acquired through reinvestment of dividends or
capital gain distributions are not subject to an initial sales charge.

SALES CHARGE AS A
PERCENTAGE OF:
DEALER
NET COMMISSION
OFFERING AMOUNT AS A PERCENTAGE
INVESTMENT PRICE INVESTED OF OFFERING PRICE
------------------------------------------------------------------------------

Less than $25,000 5.75% 6.10% 5.00%
------------------------------------------------------------------------------
$25,000 but less than $50,000 5.00 5.26 4.25
------------------------------------------------------------------------------
$50,000 but less than $100,000 4.50 4.71 3.75
------------------------------------------------------------------------------
$100,000 but less than $250,000 3.50 3.63 2.75
------------------------------------------------------------------------------
$250,000 but less than $500,000 2.50 2.56 2.00
------------------------------------------------------------------------------
$500,000 but less than $750,000 2.00 2.04 1.60
------------------------------------------------------------------------------
$750,000 but less than $1 million 1.50 1.52 1.20
------------------------------------------------------------------------------
$1 million or more and certain other none none see below
investments described below
------------------------------------------------------------------------------

The sales charge, expressed as a percentage of the offering price or the net
amount invested, may be higher or lower than the percentages described in the
table above due to rounding. This is because the dollar amount of the sales
charge is determined by subtracting the net asset value of the shares purchased
from the offering price, which is calculated to two decimal places using
standard rounding criteria. The impact of rounding will vary with the size of
the investment and the net asset value of the shares. Similarly, any contingent
deferred sales charge paid by you on investments in Class A shares may be higher
or lower than the 1% charge described below due to rounding.

EXCEPT AS PROVIDED BELOW, INVESTMENTS IN CLASS A SHARES OF $1 MILLION OR MORE
MAY BE SUBJECT TO A 1% CONTINGENT DEFERRED SALES CHARGE IF THE SHARES ARE SOLD
WITHIN ONE YEAR OF PURCHASE. The contingent deferred sales charge is based on
the original purchase cost or the current market value of the shares being sold,
whichever is less.

New World Fund / Prospectus
<PAGE>

CLASS A PURCHASES NOT SUBJECT TO SALES CHARGES

The following investments are not subject to any initial or contingent deferred
sales charge if American Funds Service Company is properly notified of the
nature of the investment:

. investments in Class A shares made by endowments or foundations with $50
million or more in assets;

. investments made by accounts that are part of certain qualified fee-based
programs and that purchased Class A shares before March 15, 2001; and

. certain rollover investments from retirement plans to IRAs (see "Rollovers
from retirement plans to IRAs" below for more information).

The distributor may pay dealers up to 1% on investments made in Class A shares
with no initial sales charge. The fund may reimburse the distributor for these
payments through its plans of distribution (see "Plans of distribution" below).

A transfer from the Virginia Prepaid Education Program/SM/ or the Virginia
Education Savings Trust/SM/ to a CollegeAmerica account will be made with no
sales charge. No commission will be paid to the dealer on such a transfer.

Certain other investors may qualify to purchase shares without a sales charge,
such as employees of investment dealers and registered investment advisers
authorized to sell American Funds, and employees of The Capital Group Companies.
Please see the statement of additional information for more information.

EMPLOYER-SPONSORED RETIREMENT PLANS

Employer-sponsored retirement plans not currently invested in Class A shares
and wishing to invest without a sales charge are not eligible to purchase Class
A shares. Such plans may invest only in Class R shares, which are described in
more detail in the fund's retirement plan prospectus.

Provided that the plan's recordkeeper can properly apply a sales charge on the
plan's investments, an employer-sponsored retirement plan not currently
invested in Class A shares and wishing to invest less than $1 million may
invest in Class A shares, but the purchase of these shares will be subject to
the applicable sales charge. An employer-sponsored retirement plan that
purchases Class A shares with a sales charge will be eligible to purchase
additional Class A shares in accordance with the sales charge table above. If
the recordkeeper cannot properly apply a sales charge on the plan's
investments, then the plan may invest only in Class R shares.

Employer-sponsored retirement plans not currently invested in Class A shares,
or that are currently investing in Class A shares with a sales charge, are not
eligible to establish a statement of intention that qualifies them to purchase
Class A shares without a sales charge. More information about statements of
intention can be found under "Sales charge reductions and waivers."

New World Fund / Prospectus

<PAGE>

Employer-sponsored retirement plans that invested in Class A shares without any
sales charge on or before March 31, 2004, and that continue to meet the
eligibility requirements in effect as of that date for purchasing Class A
shares at net asset value, may continue to purchase Class A shares without any
initial or contingent deferred sales charge.

CLASS B AND C SHARES

Class B and C shares are sold without any initial sales charge. American Funds
Distributors pays 4% of the amount invested to dealers who sell Class B shares
and 1% to dealers who sell Class C shares.

For Class B shares, a contingent deferred sales charge may be applied to shares
you sell within six years of purchase, as shown in the table below.

CONTINGENT DEFERRED SALES CHARGE ON CLASS B SHARES

YEAR OF REDEMPTION: 1 2 3 4 5 6 7+
----------------------------------------------------------------------
CONTINGENT DEFERRED SALES CHARGE: 5% 4% 4% 3% 2% 1% 0%

For Class C shares, a contingent deferred sales charge of 1% applies if shares
are sold within one year of purchase.

Any contingent deferred sales charge paid by you on investments in Class B or C
shares, expressed as a percentage of the applicable redemption amount, may be
higher or lower than the percentages described above due to rounding.

Shares acquired through reinvestment of dividends or capital gain distributions
are not subject to a contingent deferred sales charge. In addition, the
contingent deferred sales charge may be waived in certain circumstances. See
"Contingent deferred sales charge waivers" below. The contingent deferred sales
charge is based on the original purchase cost or the current market value of the
shares being sold, whichever is less. For purposes of determining the contingent
deferred sales charge, if you sell only some of your shares, shares that are not
subject to any contingent deferred sales charge will be sold first, followed by
shares that you have owned the longest.

See "Plans of distribution" below for ongoing compensation paid to your dealer
or financial adviser for all share classes.

CONVERSION OF CLASS B AND C SHARES
Class B shares automatically convert to Class A shares in the month of the
eight-year anniversary of the purchase date. Class C shares automatically
convert to Class F shares in the month of the 10-year anniversary of the
purchase date; however, Class 529-C shares will not convert to Class 529-F
shares. The Internal Revenue Service currently takes the position that these
automatic conversions are not taxable. Should its position change, the automatic
conversion feature may be suspended. If this happens, you would have the

New World Fund / Prospectus
<PAGE>

option of converting your Class B, 529-B or C shares to the respective share
classes at the anniversary dates described above. This exchange would be based
on the relative net asset values of the two classes in question, without the
imposition of a sales charge or fee, but you might face certain tax consequences
as a result.

CLASS 529-E AND CLASS F SHARES

Class 529-E and Class F shares are sold without any initial or contingent
deferred sales charge.

New World Fund / Prospectus

<PAGE>

Sales charge reductions and waivers

TO RECEIVE A REDUCTION IN YOUR CLASS A INITIAL SALES CHARGE, YOU MUST LET YOUR
FINANCIAL ADVISER OR AMERICAN FUNDS SERVICE COMPANY KNOW AT THE TIME YOU
PURCHASE SHARES THAT YOU QUALIFY FOR SUCH A REDUCTION. IF YOU DO NOT LET YOUR
ADVISER OR AMERICAN FUNDS SERVICE COMPANY KNOW THAT YOU ARE ELIGIBLE FOR A
REDUCTION, YOU MAY NOT RECEIVE A SALES CHARGE DISCOUNT TO WHICH YOU ARE
OTHERWISE ENTITLED. In order to determine your eligibility to receive a sales
charge discount, it may be necessary for you to provide your adviser or American
Funds Service Company with information and records (including account
statements) of all relevant accounts invested in the American Funds. To have
your Class A, B or C contingent deferred sales charge waived, you must let your
adviser or American Funds Service Company know at the time you redeem shares
that you qualify for such a waiver.

REDUCING YOUR CLASS A INITIAL SALES CHARGE

Consistent with the policies described in this prospectus, you and your
"immediate family" (your spouse -- or equivalent if recognized under local law
-- and your children under the age of 21) may combine all of your American Funds
and American Legacy investments to reduce your Class A sales charge. However,
for this purpose, investments representing direct purchases of American Funds
money market funds are excluded.

AGGREGATING ACCOUNTS

To receive a reduced Class A sales charge, investments made by you and your
immediate family (see above) may be aggregated if made for your own account(s)
and/or certain other accounts, such as:

. trust accounts established by the above individuals (please see the statement
of additional information for details regarding aggregation of trust accounts
where the person(s) who established the trust is deceased);

. solely controlled business accounts; and

. single-participant retirement plans.

CONCURRENT PURCHASES

You may combine simultaneous purchases (including, upon your request, purchases
for gifts) of any class of shares of two or more American Funds, as well as
individual holdings in various American Legacy variable annuity contracts and
variable life insurance policies, to qualify for a reduced Class A sales
charge.

RIGHTS OF ACCUMULATION

You have the right to take into account your accumulated holdings in all share
classes of the American Funds to determine the initial sales charge you pay on
each purchase of Class A shares. Subject to your investment dealer's
capabilities, your accumulated

New World Fund / Prospectus
<PAGE>

holdings will be calculated as the higher of (a) the current value of your
existing holdings or (b) the amount you invested (excluding capital
appreciation) less any withdrawals. Please see the statement of additional
information for details. You should retain any records necessary to
substantiate the historical amounts you have invested.

In addition, you may also take into account the current value of your
individual holdings in various American Legacy variable annuity contracts and
variable life insurance policies to determine your Class A sales charge. If you
make a gift of shares, upon your request, you may purchase the shares at the
sales charge discount allowed under rights of accumulation of all of your
American Funds and American Legacy accounts.

STATEMENT OF INTENTION

You may reduce your Class A sales charge by establishing a statement of
intention. A statement of intention allows you to combine all American Funds
non-money market fund purchases of all share classes you intend to make over a
13-month period, as well as individual holdings in various American Legacy
variable annuity contracts and variable life insurance policies, to determine
the applicable sales charge; however, investments made under a right of
reinvestment, appreciation of your investment, and reinvested dividends and
capital gains do not apply toward these combined purchases. At your request,
purchases made during the previous 90 days may be included. A portion of your
account may be held in escrow to cover additional Class A sales charges that
may be due if your total investments over the 13-month period do not qualify
for the applicable sales charge reduction. Employer-sponsored retirement plans
may be restricted from establishing statements of intention. See "Sales
charges" above for more information.

RIGHT OF REINVESTMENT

Please see "How to sell shares" below for information on how to reinvest
proceeds from a redemption, dividend payment or capital gain distribution
without a sales charge.

CONTINGENT DEFERRED SALES CHARGE WAIVERS

The contingent deferred sales charge on Class A, B and C shares may be waived in
the following cases:

. permitted exchanges of shares, except if shares acquired by exchange are then
redeemed within the period during which a contingent deferred sales charge
would apply to the initial shares purchased;

. tax-free returns of excess contributions to IRAs;

. redemptions due to death or postpurchase disability of the shareholder (this
generally excludes accounts registered in the names of trusts and other
entities);

. for 529 share classes only, redemptions due to a beneficiary's death,
postpurchase disability or receipt of a scholarship (to the extent of the
scholarship award);

. redemptions due to the complete termination of a trust upon the death of the
trustor/ grantor or beneficiary, but only if such termination is specifically
provided for in the trust document;

New World Fund / Prospectus

<PAGE>

. the following types of transactions, if together they do not exceed 12% of the
value of an account annually (see the statement of additional information for
more information about waivers regarding these types of transactions):

-- redemptions due to receiving required minimum distributions from retirement
accounts upon reaching age 70 1/2 (required minimum distributions that
continue to be taken by the beneficiary(ies) after the account owner is
deceased also qualify for a waiver); and

-- if you have established a systematic withdrawal plan, redemptions through
such a plan (including any dividends and/or capital gain distributions taken
in cash).

YOU MAY OBTAIN MORE INFORMATION ABOUT SALES CHARGE REDUCTIONS AND WAIVERS
THROUGH A LINK ON THE HOME PAGE OF THE AMERICAN FUNDS WEBSITE AT
AMERICANFUNDS.COM, FROM THE STATEMENT OF ADDITIONAL INFORMATION OR FROM YOUR
FINANCIAL ADVISER.

Rollovers from retirement plans to IRAs

Assets from retirement plans may be invested in Class A, B, C or F shares
through an IRA rollover. Rollovers invested in Class A shares from retirement
plans will be subject to applicable sales charges. The following rollovers to
Class A shares will be made at no sales charge:

. rollovers to IRAs from 403(b) plans with Capital Bank and Trust Company as
custodian; and

. rollovers to IRAs that are attributable to American Funds investments, if they
meet the following three requirements:

-- the retirement plan from which assets are being rolled over is part of an
American Funds proprietary retirement plan program (such as PlanPremier,/(R)/
Recordkeeper Direct/(R)/ or Recordkeeper Connect/(R)/) or is a plan whose
participant subaccounts are serviced by American Funds Service Company;

-- the plan's assets were invested in American Funds at the time of
distribution; and

-- the plan's assets are rolled over to an American Funds IRA with Capital Bank
and Trust Company as custodian.

IRA rollover assets that roll over at no sales charge as described above will
not be subject to a contingent deferred sales charge and investment dealers will
be compensated solely with an annual service fee that begins to accrue
immediately. IRA rollover assets that are not attributable to American Funds
investments, as well as future contributions to the IRA, will be subject to
sales charges and the terms and conditions generally applicable to Class A share
investments as described in the prospectus and statement of additional
information if invested in Class A shares.

TRANSFERS TO IRAS

Transfers to IRAs that are attributable to American Funds investments held in
SIMPLE IRAs, SEPs or SARSEPs will not be subject to a sales charge if invested
in Class A shares.

New World Fund / Prospectus
<PAGE>

Plans of distribution

The fund has plans of distribution or "12b-1 plans" under which it may finance
activities primarily intended to sell shares, provided the categories of
expenses are approved in advance by the fund's Board of Directors. The plans
provide for payments, based on annualized percentages of average daily net
assets, of up to .30% for Class A shares; up to .50% for Class 529-A shares; up
to 1.00% for Class B, 529-B, C and 529-C shares; up to .75% for Class 529-E
shares; and up to .50% for Class F and 529-F shares. For all share classes, up
to .25% of these expenses may be used to pay service fees to qualified dealers
for providing certain shareholder services. The amount remaining for each share
class may be used for distribution expenses.

The 12b-1 fees paid by the fund, as a percentage of average net assets, for the
previous fiscal year are indicated in the Annual Fund Operating Expenses table
under "Fees and expenses of the fund." Since these fees are paid out of the
fund's assets or income on an ongoing basis, over time they will increase the
cost and reduce the return of your investment. The higher fees for Class B and C
shares may cost you more over time than paying the initial sales charge for
Class A shares.

Other compensation to dealers

American Funds Distributors, at its expense, currently provides additional
compensation to investment dealers. These payments may be made, at the
discretion of American Funds Distributors, to the top 75 dealers who have sold
shares of the American Funds. The level of payments made to a qualifying dealer
in any given year will vary and in no case would exceed the sum of (a) .10% of
the previous year's American Funds sales by that dealer and (b) .02% of American
Funds assets attributable to that dealer. For calendar year 2004, aggregate
payments made by American Funds Distributors to dealers were less than .02% of
the assets of the American Funds. Aggregate payments may also change from year
to year. A number of factors will be considered in determining payments,
including the qualifying dealer's sales, assets and redemption rates, and the
quality of the dealer's relationship with American Funds Distributors. American
Funds Distributors makes these payments to help defray the costs incurred by
qualifying dealers in connection with efforts to educate financial advisers
about the American Funds so that they can make recommendations and provide
services that are suitable and meet shareholder needs. American Funds
Distributors will, on an annual basis, determine the advisability of continuing
these payments. American Funds Distributors may also pay expenses associated
with meetings conducted by dealers outside the top 75 firms to facilitate
educating financial advisers and shareholders about the American Funds.

New World Fund / Prospectus

<PAGE>

How to sell shares

You may sell (redeem) shares in any of the following ways:

THROUGH YOUR DEALER OR FINANCIAL ADVISER (CERTAIN CHARGES MAY APPLY)

. Shares held for you in your dealer's name must be sold through the dealer.

. Class F shares must be sold through your dealer or financial adviser.

WRITING TO AMERICAN FUNDS SERVICE COMPANY

. Requests must be signed by the registered shareholder(s).

. A signature guarantee is required if the redemption is:

-- over $75,000;

-- made payable to someone other than the registered shareholder(s); or

-- sent to an address other than the address of record, or an address of
record that has been changed within the last 10 days.

. American Funds Service Company reserves the right to require signature
guarantee(s) on any redemptions.

. Additional documentation may be required for sales of shares held in
corporate, partnership or fiduciary accounts.

TELEPHONING OR FAXING AMERICAN FUNDS SERVICE COMPANY OR USING THE INTERNET

. Redemptions by telephone, fax or the Internet (including American
FundsLine/(R)/ and americanfunds.com) are limited to $75,000 per American
Funds shareholder each day.

. Checks must be made payable to the registered shareholder.

. Checks must be mailed to an address of record that has been used with the
account for at least 10 days.

If you recently purchased shares and subsequently request a redemption of those
shares, you will receive proceeds from the redemption once a sufficient period
of time has passed to reasonably assure that checks or drafts (including
certified or cashier's checks) for the shares purchased have cleared (normally
15 calendar days).

If you notify American Funds Service Company, you may reinvest proceeds from a
redemption, dividend payment or capital gain distribution without a sales charge
in the same fund or other American Funds within 90 days after the date of the
redemption or distribution. Proceeds from a Class B share redemption where a
contingent deferred sales charge was charged will be reinvested in Class A
shares. Proceeds from any other type of redemption and all dividend payments and
capital gain distributions will be reinvested in the same share class from which
the original redemption or distribution was made. Any contingent deferred sales
charge on Class A or C shares will be credited to your account. Redemption
proceeds of Class A shares representing direct purchases in American Funds money
market funds that are reinvested in non-money market American Funds will be
subject to a sales charge. Proceeds will be reinvested at the next calculated
net asset

New World Fund / Prospectus
<PAGE>

value after your request is received and accepted by American Funds Service
Company. You may not reinvest proceeds in the American Funds as described in
this paragraph if such proceeds are subject to a purchase block as described
under "Frequent trading of fund shares." This paragraph does not apply to
rollover investments as described under "Rollovers from retirement plans to
IRAs."

TRANSACTIONS BY TELEPHONE, FAX OR THE INTERNET

Generally, you are automatically eligible to use these services for redemptions
and exchanges unless you notify us in writing that you do not want any or all of
these services. You may reinstate these services at any time.

Unless you decide not to have telephone, fax or Internet services on your
account(s), you agree to hold the fund, American Funds Service Company, any of
its affiliates or mutual funds managed by such affiliates, and each of their
respective directors, trustees, officers, employees and agents harmless from any
losses, expenses, costs or liabilities (including attorney fees) that may be
incurred in connection with the exercise of these privileges, provided American
Funds Service Company employs reasonable procedures to confirm that the
instructions received from any person with appropriate account information are
genuine. If reasonable procedures are not employed, American Funds Service
Company and/or the fund may be liable for losses due to unauthorized or
fraudulent instructions.

New World Fund / Prospectus

<PAGE>

Distributions and taxes

DIVIDENDS AND DISTRIBUTIONS

The fund intends to distribute dividends to you, usually in December.

Capital gains, if any, are usually distributed in December. When a dividend or
capital gain is distributed, the net asset value per share is reduced by the
amount of the payment.

You may elect to reinvest dividends and/or capital gain distributions to
purchase additional shares of this fund or other American Funds, or you may
elect to receive them in cash. Most shareholders do not elect to take capital
gain distributions in cash because these distributions reduce principal value.
Dividends and capital gain distributions for 529 share classes will be
automatically reinvested.

TAXES ON DIVIDENDS AND DISTRIBUTIONS

Dividends and capital gain distributions you receive from the fund will be
subject to federal income tax and may also be subject to state or local taxes --
unless you are exempt from taxation.

For federal tax purposes, dividends and distributions of short-term capital
gains are taxable as ordinary income. Some or all of your dividends may be
eligible for a reduced tax rate if you meet a holding period requirement. The
fund's distributions of net long-term capital gains are taxable as long-term
capital gains. Any dividends or capital gain distributions you receive from the
fund will normally be taxable to you when made, regardless of whether you
reinvest dividends or capital gain distributions or receive them in cash.

TAXES ON TRANSACTIONS

Your redemptions, including exchanges, may result in a capital gain or loss for
federal tax purposes. A capital gain or loss on your investment is the
difference between the cost of your shares, including any sales charges, and the
amount you receive when you sell them.

PLEASE SEE YOUR TAX ADVISER FOR MORE INFORMATION. HOLDERS OF 529 SHARES SHOULD
REFER TO THE COLLEGEAMERICA PROGRAM DESCRIPTION FOR MORE INFORMATION REGARDING
THE TAX CONSEQUENCES OF SELLING 529 SHARES.

New World Fund / Prospectus
<PAGE>

Financial highlights/1/

The Financial Highlights table is intended to help you understand the fund's
results for the past five fiscal years. Certain information reflects financial
results for a single share of a particular class. The total returns in the table
represent the rate that an investor would have earned or lost on an investment
in the fund (assuming reinvestment of all dividends and capital gain
distributions). This information has been audited by Deloitte & Touche LLP,
whose report, along with the fund's financial statements, is included in the
statement of additional information, which is available upon request.

INCOME (LOSS) FROM INVESTMENT OPERATIONS/2/

Net
gains (losses)
Net asset on securities
value, Net (both realized Total from
beginning investment and investment
of period income unrealized) operations
-----------------------------------------------------------------------------------------------

CLASS A:
Year ended 10/31/2005 $29.68 $.68 $ 6.51 $ 7.19
Year ended 10/31/2004 25.60 .47 4.20 4.67
Year ended 10/31/2003 18.90 .39 6.56 6.95
Year ended 10/31/2002 19.04 .34 .07 .41
Year ended 10/31/2001 22.81 .47 (3.87) (3.40)
-----------------------------------------------------------------------------------------------
CLASS B:
Year ended 10/31/2005 29.23 .42 6.42 6.84
Year ended 10/31/2004 25.29 .25 4.14 4.39
Year ended 10/31/2003 18.69 .22 6.50 6.72
Year ended 10/31/2002 18.82 .16 .09 .25
Year ended 10/31/2001 22.71 .28 (3.85) (3.57)
-----------------------------------------------------------------------------------------------
CLASS C:
Year ended 10/31/2005 29.03 .40 6.37 6.77
Year ended 10/31/2004 25.18 .24 4.11 4.35
Year ended 10/31/2003 18.66 .21 6.48 6.69
Year ended 10/31/2002 18.76 .12 .12 .24
Period from 3/15/2001 to 10/31/2001 21.44 .09 (2.77) (2.68)
-----------------------------------------------------------------------------------------------
CLASS F:
Year ended 10/31/2005 29.54 .67 6.47 7.14
Year ended 10/31/2004 25.52 .46 4.17 4.63
Year ended 10/31/2003 18.88 .38 6.54 6.92
Year ended 10/31/2002 18.98 .28 .12 .40
Period from 3/16/2001 to 10/31/2001 21.42 .21 (2.65) (2.44)
-----------------------------------------------------------------------------------------------
CLASS 529-A:
Year ended 10/31/2005 $29.59 $.67 $ 6.48 $ 7.15
Year ended 10/31/2004 25.56 .46 4.18 4.64
Year ended 10/31/2003 18.89 .40 6.54 6.94
Period from 2/19/2002 to 10/31/2002 21.19 .14 (2.44) (2.30)
-----------------------------------------------------------------------------------------------
CLASS 529-B:
Year ended 10/31/2005 29.15 .36 6.41 6.77
Year ended 10/31/2004 25.25 .20 4.14 4.34
Year ended 10/31/2003 18.79 .19 6.48 6.67
Period from 2/26/2002 to 10/31/2002 21.20 .02 (2.43) (2.41)
-----------------------------------------------------------------------------------------------
CLASS 529-C:
Year ended 10/31/2005 29.17 .37 6.40 6.77
Year ended 10/31/2004 25.28 .21 4.14 4.35
Year ended 10/31/2003 18.79 .19 6.50 6.69
Period from 2/25/2002 to 10/31/2002 21.15 .04 (2.40) (2.36)
-----------------------------------------------------------------------------------------------
CLASS 529-E:
Year ended 10/31/2005 29.46 .56 6.45 7.01
Year ended 10/31/2004 25.46 .36 4.18 4.54
Year ended 10/31/2003 18.86 .31 6.53 6.84
Period from 3/22/2002 to 10/31/2002 22.57 .10 (3.81) (3.71)
-----------------------------------------------------------------------------------------------
CLASS 529-F:
Year ended 10/31/2005 29.53 .68 6.47 7.15
Year ended 10/31/2004 25.54 .43 4.18 4.61
Year ended 10/31/2003 18.90 .39 6.52 6.91
Period from 9/17/2002 to 10/31/2002 19.44 --/7/ (.54) (.54)

Dividends
(from net Net asset
investment value, end of Total
income) period return/3/
----------------------------------------------------------------------------

CLASS A:
Year ended 10/31/2005 $(.55) $36.32 24.50%
Year ended 10/31/2004 (.59) 29.68 18.51
Year ended 10/31/2003 (.25) 25.60 37.19
Year ended 10/31/2002 (.55) 18.90 1.95
Year ended 10/31/2001 (.37) 19.04 (15.13)
----------------------------------------------------------------------------
CLASS B:
Year ended 10/31/2005 (.36) 35.71 23.57
Year ended 10/31/2004 (.45) 29.23 17.58
Year ended 10/31/2003 (.12) 25.29 36.12
Year ended 10/31/2002 (.38) 18.69 1.17
Year ended 10/31/2001 (.32) 18.82 (15.91)
----------------------------------------------------------------------------
CLASS C:
Year ended 10/31/2005 (.38) 35.42 23.52
Year ended 10/31/2004 (.50) 29.03 17.53
Year ended 10/31/2003 (.17) 25.18 36.10
Year ended 10/31/2002 (.34) 18.66 1.15
Period from 3/15/2001 to 10/31/2001 -- 18.76 (12.50)
----------------------------------------------------------------------------
CLASS F:
Year ended 10/31/2005 (.55) 36.13 24.46
Year ended 10/31/2004 (.61) 29.54 18.44
Year ended 10/31/2003 (.28) 25.52 37.10
Year ended 10/31/2002 (.50) 18.88 1.95
Period from 3/16/2001 to 10/31/2001 -- 18.98 (11.39)
----------------------------------------------------------------------------
CLASS 529-A:
Year ended 10/31/2005 $(.55) $36.19 24.45%
Year ended 10/31/2004 (.61) 29.59 18.43
Year ended 10/31/2003 (.27) 25.56 37.18
Period from 2/19/2002 to 10/31/2002 -- 18.89 (10.85)
----------------------------------------------------------------------------
CLASS 529-B:
Year ended 10/31/2005 (.34) 35.58 23.38
Year ended 10/31/2004 (.44) 29.15 17.41
Year ended 10/31/2003 (.21) 25.25 35.86
Period from 2/26/2002 to 10/31/2002 -- 18.79 (11.37)
----------------------------------------------------------------------------
CLASS 529-C:
Year ended 10/31/2005 (.34) 35.60 23.38
Year ended 10/31/2004 (.46) 29.17 17.43
Year ended 10/31/2003 (.20) 25.28 35.90
Period from 2/25/2002 to 10/31/2002 -- 18.79 (11.16)
----------------------------------------------------------------------------
CLASS 529-E:
Year ended 10/31/2005 (.47) 36.00 24.02
Year ended 10/31/2004 (.54) 29.46 18.07
Year ended 10/31/2003 (.24) 25.46 36.64
Period from 3/22/2002 to 10/31/2002 -- 18.86 (16.44)
----------------------------------------------------------------------------
CLASS 529-F:
Year ended 10/31/2005 (.53) 36.15 24.49
Year ended 10/31/2004 (.62) 29.53 18.33
Year ended 10/31/2003 (.27) 25.54 37.01
Period from 9/17/2002 to 10/31/2002 -- 18.90 (2.78)

Ratio of Ratio of
expenses expenses
to average to average
net assets net assets
Net assets, before after Ratio of net
end of reim- reim- income
period bursements/ bursements/ to average
(in millions) waivers waivers/4/ net assets
---------------------------------------------------------------------------------------------

CLASS A:
Year ended 10/31/2005 $4,195 1.18 % 1.12 % 2.00 %
Year ended 10/31/2004 2,212 1.23 1.22 1.68
Year ended 10/31/2003 1,528 1.31 1.31 1.86
Year ended 10/31/2002 1,071 1.34 1.34 1.65
Year ended 10/31/2001 1,053 1.29 1.29 2.15
---------------------------------------------------------------------------------------------
CLASS B:
Year ended 10/31/2005 170 1.94 1.88 1.24
Year ended 10/31/2004 89 2.01 2.00 .91
Year ended 10/31/2003 52 2.10 2.10 1.05
Year ended 10/31/2002 29 2.15 2.15 .78
Year ended 10/31/2001 20 2.13 2.13 1.32
---------------------------------------------------------------------------------------------
CLASS C:
Year ended 10/31/2005 246 1.98 1.92 1.21
Year ended 10/31/2004 96 2.04 2.03 .89
Year ended 10/31/2003 39 2.12 2.12 .99
Year ended 10/31/2002 13 2.14 2.14 .61
Period from 3/15/2001 to 10/31/2001 3 2.19/5/ 2.19/5/ .69/5/
---------------------------------------------------------------------------------------------
CLASS F:
Year ended 10/31/2005 336 1.19 1.14 1.98
Year ended 10/31/2004 162 1.27 1.26 1.65
Year ended 10/31/2003 71 1.35 1.35 1.77
Year ended 10/31/2002 23 1.38 1.38 1.35
Period from 3/16/2001 to 10/31/2001 3 1.40/5/ 1.40/5/ 1.62/5/
---------------------------------------------------------------------------------------------
CLASS 529-A:
Year ended 10/31/2005 $ 76 1.21 % 1.15 % 1.97 %
Year ended 10/31/2004 31 1.27 1.26 1.65
Year ended 10/31/2003 13 1.30 1.30 1.87
Period from 2/19/2002 to 10/31/2002 5 1.47/5/ 1.47/5/ .99/5/
---------------------------------------------------------------------------------------------
CLASS 529-B:
Year ended 10/31/2005 11 2.09 2.04 1.09
Year ended 10/31/2004 6 2.17 2.17 .74
Year ended 10/31/2003 3 2.27 2.27 .89
Period from 2/26/2002 to 10/31/2002 1 2.25/5/ 2.25/5/ .14/5/
---------------------------------------------------------------------------------------------
CLASS 529-C:
Year ended 10/31/2005 20 2.08 2.02 1.11
Year ended 10/31/2004 8 2.16 2.15 .76
Year ended 10/31/2003 4 2.24 2.24 .90
Period from 2/25/2002 to 10/31/2002 1 2.21/5/ 2.21/5/ .26/5/
---------------------------------------------------------------------------------------------
CLASS 529-E:
Year ended 10/31/2005 4 1.55 1.49 1.65
Year ended 10/31/2004 2 1.62 1.61 1.31
Year ended 10/31/2003 1 1.69 1.69 1.47
Period from 3/22/2002 to 10/31/2002 --/6/ 1.66/5/ 1.66/5/ .78/5/
---------------------------------------------------------------------------------------------
CLASS 529-F:
Year ended 10/31/2005 4 1.17 1.11 2.02
Year ended 10/31/2004 2 1.37 1.36 1.54
Year ended 10/31/2003 1 1.43 1.43 1.74
Period from 9/17/2002 to 10/31/2002 --/6/ .17 .17 --/8/

New World Fund / Prospectus

<PAGE>

(The Financial Highlights table continues on the following page.)

New World Fund / Prospectus

<PAGE>

YEAR ENDED OCTOBER 31
2005 2004 2003 2002 2001
------------------------------------------------------------------------------------

PORTFOLIO TURNOVER
RATE FOR ALL CLASSES 26% 20% 30% 32% 40%
OF SHARES

1 Based on operations for the period shown (unless otherwise noted) and,
accordingly, may not be representative of a full year.
2 Based on average shares outstanding.
3 Total returns exclude all sales charges, including contingent deferred sales
charges.
4 The ratios in this column reflect the impact, if any, of certain
reimbursements/waivers from Capital Research and Management Company. See the
Annual Fund Operating Expenses table under "Fees and expenses of the fund" and
the audited financial statements in the fund's annual report for more
information.
5 Annualized.
6 Amount less than $1 million.
7 Amount less than one cent.
8 Amount less than .01 percent.

New World Fund / Prospectus

<PAGE>

NOTES

New World Fund / Prospectus

<PAGE>

[logo - American Funds /(R)/] The right choice for the long term/(R)/

FOR SHAREHOLDER SERVICES American Funds Service Company
800/421-0180
FOR RETIREMENT PLAN SERVICES Call your employer or plan administrator
FOR DEALER SERVICES American Funds Distributors
800/421-9900
FOR COLLEGEAMERICA/(R)/ American Funds Service Company
800 /421-0180, ext. 529
FOR 24-HOUR INFORMATION American FundsLine/(R)/
800/325-3590
americanfunds.com

Telephone calls you have with the American Funds
organization may be monitored or recorded for
quality-assurance, verification and/or recordkeeping
purposes. By speaking with us on the telephone, you are
giving your consent to such monitoring and recording.
-----------------------------------------------------------------------------------

MULTIPLE TRANSLATIONS This prospectus may be translated into other languages.
If there is any inconsistency or ambiguity as to the meaning of any word or
phrase in a translation, the English text will prevail.

ANNUAL/SEMI-ANNUAL REPORT TO SHAREHOLDERS The shareholder reports contain
additional information about the fund, including financial statements,
investment results, portfolio holdings, a discussion of market conditions and
the fund's investment strategies, and the independent registered public
accounting firm's report (in the annual report).

COLLEGEAMERICA PROGRAM DESCRIPTION The CollegeAmerica Program Description
contains additional information about the policies and services related to
CollegeAmerica accounts.

STATEMENT OF ADDITIONAL INFORMATION (SAI) AND CODES OF ETHICS The current SAI,
as amended from time to time, contains more detailed information on all aspects
of the fund, including the fund's financial statements, and is incorporated by
reference into this prospectus. This means that the current SAI, for legal
purposes, is part of this prospectus. The codes of ethics describe the personal
investing policies adopted by the fund and the fund's investment adviser and its
affiliated companies.

The codes of ethics and current SAI are on file with the Securities and Exchange
Commission (SEC). These and other related materials about the fund are available
for review or to be copied at the SEC's Public Reference Room in Washington, DC
(202/942-8090) or on the EDGAR database on the SEC's website at www.sec.gov or,
after payment of a duplicating fee, via e-mail request to publicinfo@sec.gov or
by writing to the SEC's Public Reference Section, Washington, DC 20549-0102. The
current SAI is also available on americanfunds.com.

HOUSEHOLD MAILINGS Each year you are automatically sent an updated prospectus
and annual and semi-annual reports for the fund. You may also occasionally
receive proxy statements for the fund. In order to reduce the volume of mail you
receive, when possible, only one copy of these documents will be sent to
shareholders who are part of the same family and share the same residential address.

If you would like to opt out of household mailings or receive a complimentary
copy of the current SAI, codes of ethics, annual/semi-annual report to
shareholders or CollegeAmerica Program Description, please call American Funds
Service Company at 800/421-0180 or write to the Secretary of the fund at 333
South Hope Street, Los Angeles, California 90071.

[recycle bug logo]

Printed on recycled paper
MFGEPR-936-0106P Litho in USA Investment Company File No. 811-9105
CGD/RRD/8017
-------------------------------------------------------------------------------
THE CAPITAL GROUP COMPANIES
American Funds Capital Research and Management Capital International Capital Guardian Capital Bank and Trust

<PAGE>

[logo - American Funds /(R)/] The right choice for the long term/(R)/

New World Fund/SM/

PROSPECTUS
ADDENDUM

January 1, 2006

<PAGE>

Class R-5 shares of New World Fund are available to certain clients of the
Personal Investment Management group of Capital Guardian Trust Company./SM/
Accordingly, for these shareholders, the following information should be read
in conjunction with the prospectus for this fund.

Fees and expenses of the fund -- pages 5-6

These tables describe the fees and expenses that you may pay if you buy and hold
shares of the fund.

SHAREHOLDER FEES (PAID DIRECTLY FROM YOUR INVESTMENT)
CLASS R-5
-------------------------------------------------------------------------------

Maximum initial sales charge on purchases (as a percentage of none
offering price)
-------------------------------------------------------------------------------
Maximum sales charge on reinvested dividends none
-------------------------------------------------------------------------------
Maximum contingent deferred sales charge none
-------------------------------------------------------------------------------
Redemption or exchange fees none

ANNUAL FUND OPERATING EXPENSES (DEDUCTED FROM FUND ASSETS)
CLASS R-5
--------------------------------------------------------------

Management fees/1/ 0.69%
--------------------------------------------------------------
Distribution and/or service (12b-1) fees none
--------------------------------------------------------------
Other expenses/2/ 0.20
--------------------------------------------------------------
Total annual fund operating expenses/1/ 0.89

1 The fund's investment adviser began waiving 5% of its management fees on
September 1, 2004. Beginning April 1, 2005, this waiver increased to 10% and is
expected to continue at this level until further review. Total annual fund
operating expenses do not reflect any waiver. Information regarding the effect
of any waiver on total annual fund operating expenses can be found in the
Financial Highlights table and the audited financial statements in the fund's
annual report.
2 A portion of the fund's expenses may be used to pay third parties (including
affiliates of the fund's investment adviser) that provide recordkeeping
services to retirement plans invested in the fund.

EXAMPLE

The example below is intended to help you compare the cost of investing in the
fund with the cost of investing in other mutual funds. The example assumes that
you invest $10,000 in the fund for the time periods indicated, that your
investment has a 5% return each year, that all dividends and capital gain
distributions are reinvested, and that the fund's operating expenses remain the
same as shown above. The example does not reflect the impact of any fee waivers
or expense reimbursements.

Although your actual costs may be higher or lower, based on these assumptions,
your cumulative estimated expenses would be:

1 YEAR 3 YEARS 5 YEARS 10 YEARS
-------------------------------------------------------------

Class R-5 $91 $284 $493 $1,096
-------------------------------------------------------------

<PAGE>

Purchase and exchange of shares -- pages 17-20

PURCHASE OF CLASS R-5 SHARES

Class R-5 shares of the fund are available to certain clients of the Personal
Investment Management group of Capital Guardian Trust Company. Please contact
Capital Guardian Trust Company if you wish to purchase Class R-5 shares of the
fund.

Sales charges -- pages 21-24

CLASS R-5 SHARES

Class R-5 shares are sold without any initial or contingent deferred sales
charge. In addition, no compensation is paid to investment dealers on sales of
Class R-5 shares.

<PAGE>

Financial highlights/1/ -- pages 32-34

The Financial Highlights table is intended to help you understand the fund's
results. Certain information reflects financial results for a single share. The
total returns in the table represent the rate that an investor would have earned
or lost on an investment in the fund (assuming reinvestment of all dividends and
capital gain distributions). This information has been audited by Deloitte &
Touche LLP, whose report, along with the fund's financial statements, is
included in the statement of additional information, which is available upon
request.

INCOME (LOSS) FROM INVESTMENT OPERATIONS/2/

CLASS R-5:
Year ended 10/31/2005 $29.76 $.78 $ 6.51 $ 7.29
Year ended 10/31/2004 25.66 .55 4.20 4.75
Year ended 10/31/2003 18.93 .46 6.57 7.03
Period from 5/15/2002 to 10/31/2002 23.05 .12 (4.24) (4.12)

Dividends
(from net Net asset
investment value, end of Total
income) period return
--------------------------------------------------------------------------

CLASS R-5:
Year ended 10/31/2005 $(.62) $36.43 24.83%
Year ended 10/31/2004 (.65) 29.76 18.83
Year ended 10/31/2003 (.30) 25.66 37.60
Period from 5/15/2002 to 10/31/2002 -- 18.93 (17.87)

Ratio of Ratio of
expenses expenses
to average to average
net assets net assets
Net assets, before after Ratio of net
end of reim- reim- income
period bursements/ bursements/ to average
(in millions) waivers waivers/3/ net assets
---------------------------------------------------------------------------------------------

CLASS R-5:
Year ended 10/31/2005 $187 .89% .84% 2.28%
Year ended 10/31/2004 87 .95 .94 1.96
Year ended 10/31/2003 45 1.01 1.01 2.15
Period from 5/15/2002 to 10/31/2002 27 .46 .46 .62

YEAR ENDED OCTOBER 31
2005 2004 2003 2002 2001
------------------------------------------------------------------------------------

PORTFOLIO TURNOVER
RATE FOR ALL CLASSES 26% 20% 30% 32% 40%
OF SHARES

1 Based on operations for the period shown (unless otherwise noted) and,
accordingly, may not be representative of a full year.
2 Based on average shares outstanding.
3 The ratios in this column reflect the impact, if any, of certain
reimbursements/waivers from Capital Research and Management Company. See the
Annual Fund Operating Expenses table under "Fees and expenses of the fund" and
the audited financial statements in the fund's annual report for more
information.

<PAGE>

NEW WORLD FUND, INC.

Part B

Statement of Additional Information
January 1, 2006

This document is not a prospectus but should be read in conjunction with the
current prospectus or retirement plan prospectus of New World Fund, Inc. (the
"fund" or "NWF") dated January 1, 2006. You may obtain a prospectus from your
financial adviser or by writing to the fund at the following address:

New World Fund, Inc.
Attention: Secretary
333 South Hope Street
Los Angeles, California 90071
213/486-9200

Shareholders who purchase shares at net asset value through eligible retirement
plans should note that not all of the services or features described below may
be available to them. They should contact their employers for details.

TABLE OF CONTENTS

Item Page no.
---- --------

Certain investment limitations and guidelines . . . . . . . . . . . 2
Description of certain securities and investment techniques . . . . 2
Fundamental policies and investment restrictions. . . . . . . . . . 9
Management of the fund . . . . . . . . . . . . . . . . . . . . . . 11
Execution of portfolio transactions . . . . . . . . . . . . . . . . 31
Disclosure of portfolio holdings. . . . . . . . . . . . . . . . . . 31
Price of shares . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Taxes and distributions . . . . . . . . . . . . . . . . . . . . . . 34
Purchase and exchange of shares . . . . . . . . . . . . . . . . . . 39
Sales charges . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Sales charge reductions and waivers . . . . . . . . . . . . . . . . 43
Selling shares. . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Shareholder account services and privileges . . . . . . . . . . . . 48
General information . . . . . . . . . . . . . . . . . . . . . . . . 50
Appendix. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Financial statements

New World Fund -- Page 1
<PAGE>

CERTAIN INVESTMENT LIMITATIONS AND GUIDELINES

The following limitations and guidelines are considered at the time of purchase,
under normal circumstances, and are based on a percentage of the fund's net
assets unless otherwise noted. This summary is not intended to reflect all of
the fund's investment limitations.

GENERAL

. The fund will invest at least 35% of its assets in equity and debt
securities of companies based primarily in qualified countries with
developing economies and/or markets.

EQUITY SECURITIES

. The fund may invest its assets in equity securities of any company,
regardless of where it is based, if the fund's investment adviser
determines that a significant portion of its assets or revenues (generally
20% or more) is attributable to developing countries.

DEBT SECURITIES

. The fund may invest up to 25% of its assets in nonconvertible debt
securities, including government bonds and securities rated Ba or below by
Moody's Investors Service (Moody's) and BB or below by Standard & Poor's
Corporation (S&P) or unrated but determined to be of equivalent quality, of
issuers primarily based in qualified countries with developing economies
and/or markets, or of issuers that the fund's investment adviser determines
have a significant portion of their assets or revenues (generally 20% or
more) attributable to developing countries. The fund will generally
purchase debt securities considered consistent with its objective of
long-term capital appreciation.

* * * * * *

The fund may experience difficulty liquidating certain portfolio securities
during significant market declines or periods of heavy redemptions.

DESCRIPTION OF CERTAIN SECURITIES AND INVESTMENT TECHNIQUES

The descriptions below are intended to supplement the material in the prospectus
under "Investment objective, strategies and risks."

EQUITY SECURITIES -- Equity securities represent an ownership position in a
company. Equity securities held by the fund typically consist of common stocks
and may also include securities with equity conversion or purchase rights. The
prices of equity securities fluctuate based on, among other things, events
specific to their issuers and market, economic and other conditions.

There may be little trading in the secondary market for particular equity
securities, which may adversely affect the fund's ability to value accurately or
dispose of such equity securities. Adverse publicity and investor perceptions,
whether or not based on fundamental analysis, may decrease the value and/or
liquidity of equity securities.

The growth-oriented, equity-type securities generally purchased by the fund may
involve large price swings and potential for loss, particularly in the case of
smaller capitalization stocks.

New World Fund -- Page 2
<PAGE>

INVESTING IN SMALLER CAPITALIZATION STOCKS -- The fund may invest in the stocks
of smaller capitalization companies (typically companies with market
capitalizations of less than $2.0 billion at the time of purchase). The
investment adviser believes that the issuers of smaller capitalization stocks
often provide attractive investment opportunities. However, investing in smaller
capitalization stocks can involve greater risk than is customarily associated
with investing in stocks of larger, more established companies. For example,
smaller companies often have limited product lines, limited markets or financial
resources, may be dependent for management on one or a few key persons and can
be more susceptible to losses. Also, their securities may be thinly traded (and
therefore have to be sold at a discount from current prices or sold in small
lots over an extended period of time), may be followed by fewer investment
research analysts and may be subject to wider price swings, thus creating a
greater chance of loss than securities of larger capitalization companies.

INVESTING IN VARIOUS COUNTRIES -- Investing outside the United States may
involve additional risks caused by, among other things, currency controls and
fluctuating currency values; different accounting, auditing, financial reporting
and legal standards and practices in some countries; changing local, regional
and global economic, political and social conditions; expropriation; changes in
tax policy; greater market volatility; differing securities market structures;
higher transaction costs; and various administrative difficulties, such as
delays in clearing and settling portfolio transactions or in receiving payment
of dividends.

The risks described above may be heightened in connection with investments in
developing countries. Although there is no universally accepted definition, the
investment adviser generally considers a developing country as a country that is
in the earlier stages of its industrialization cycle with a low per capita gross
domestic product ("GDP") and a low market capitalization to GDP ratio relative
to those in the United States and the European Union. Historically, the markets
of developing countries have been more volatile than the markets of developed
countries, reflecting the greater uncertainties of investing in less established
markets and economies. In particular, developing countries may have less stable
governments; may present the risks of nationalization of businesses,
restrictions on foreign ownership and prohibitions on the repatriation of
assets; and may have less protection of property rights than more developed
countries. The economies of developing countries may be reliant on only a few
industries, may be highly vulnerable to changes in local or global trade
conditions and may suffer from high and volatile debt burdens or inflation
rates. Local securities markets may trade a small number of securities and may
be unable to respond effectively to increases in trading volume, potentially
making prompt liquidation of holdings difficult or impossible at times.

In determining where an issuer of a security is based, the Investment Adviser
may consider such factors as where the company is legally organized, maintains
its principal corporate offices and/ or conducts its principal operations.

Additional costs could be incurred in connection with the fund's investment
activities outside the United States. Brokerage commissions may be higher
outside the United States, and the fund will bear certain expenses in connection
with its currency transactions. Furthermore, increased custodian costs may be
associated with maintaining assets in certain jurisdictions.

CERTAIN RISK FACTORS RELATED TO DEVELOPING COUNTRIES

CURRENCY FLUCTUATIONS -- The fund's investments may be valued in currencies
other than the U.S. dollar. Certain developing countries' currencies have
experienced and may in the

New World Fund -- Page 3
<PAGE>

future experience significant declines against the U.S. dollar. For
example, if the U.S. dollar appreciates against foreign currencies, the
value of the fund's securities holdings would generally depreciate and vice
versa. Consistent with its investment objective, the fund can engage in
certain currency transactions to hedge against currency fluctuations. See
"Currency Transactions" below.

GOVERNMENT REGULATION -- The political, economic and social structures of
certain developing countries may be more volatile and less developed than
those in the United States. Certain developing countries lack uniform
accounting, auditing and financial reporting standards, have less
governmental supervision of financial markets than in the United States,
and do not honor legal rights enjoyed in the United States. Certain
governments may be more unstable and present greater risks of
nationalization or restrictions on foreign ownership of local companies.

Repatriation of investment income, capital and the proceeds of sales by
foreign investors may require governmental registration and/or approval in
some developing market countries. While the fund will only invest in
markets where these restrictions are considered acceptable, a country could
impose new or additional repatriation restrictions after the fund's
investment. If this happened, the fund's response might include, among
other things, applying to the appropriate authorities for a waiver of the
restrictions or engaging in transactions in other markets designed to
offset the risks of decline in that country. Such restrictions will be
considered in relation to the fund's liquidity needs and all other positive
and negative factors. Further, some attractive equity securities may not be
available to the fund due to foreign shareholders already holding the
maximum amount legally permissible.

While government involvement in the private sector varies in degree among
developing countries, such involvement may in some cases include government
ownership of companies in certain sectors, wage and price controls or
imposition of trade barriers and other protectionist measures. With respect
to any developing country, there is no guarantee that some future economic
or political crisis will not lead to price controls, forced mergers of
companies, expropriation, or creation of government monopolies to the
possible detriment of the fund's investments.

LESS DEVELOPED SECURITIES MARKETS -- Developing countries may have less
well-developed securities markets and exchanges. These markets have lower
trading volumes than the securities markets of more developed countries.
These markets may be unable to respond effectively to increases in trading
volume. Consequently, these markets may be substantially less liquid than
those of more developed countries, and the securities of issuers located in
these markets may have limited marketability. These factors may make prompt
liquidation of substantial portfolio holdings difficult or impossible at
times.

SETTLEMENT RISKS -- Settlement systems in developing countries are
generally less well organized than developed markets. Supervisory
authorities may also be unable to apply standards comparable to those in
developed markets. Thus, there may be risks that settlement may be delayed
and that cash or securities belonging to the fund may be in jeopardy
because of failures of or defects in the systems. In particular, market
practice may require that payment be made before receipt of the security
being purchased or that delivery of a security be made before payment is
received. In such cases, default by a broker or bank (the "counterparty")
through whom the transaction is effected might cause

New World Fund -- Page 4
<PAGE>

the fund to suffer a loss. The fund will seek, where possible, to use
counterparties whose financial status is such that this risk is reduced.
However, there can be no certainty that the fund will be successful in
eliminating this risk, particularly as counterparties operating in
developing countries frequently lack the substance or financial resources
of those in developed countries. There may also be a danger that, because
of uncertainties in the operation of settlement systems in individual
markets, competing claims may arise with respect to securities held by or
to be transferred to the fund.

INVESTOR INFORMATION -- The fund may encounter problems assessing
investment opportunities in certain developing securities markets in light
of limitations on available information and different accounting, auditing
and financial reporting standards. In such circumstances, the fund's
investment adviser will seek alternative sources of information, and to the
extent the investment adviser may not be satisfied with the sufficiency of
the information obtained with respect to a particular market or security,
the fund will not invest in such market or security.

TAXATION -- Taxation of dividends and capital gains received by
non-residents varies among developing countries and, in some cases, is
comparatively high. In addition, developing countries typically have less
well-defined tax laws and procedures and such laws may permit retroactive
taxation so that the fund could in the future become subject to local tax
liability that it had not reasonably anticipated in conducting its
investment activities or valuing its assets.

LITIGATION -- The fund and its shareholders may encounter substantial
difficulties in obtaining and enforcing judgments against non-U.S. resident
individuals and companies.

FRAUDULENT SECURITIES -- Securities purchased by the fund may subsequently
be found to be fraudulent or counterfeit, resulting in a loss to the fund.

LOAN PARTICIPATIONS -- The fund may invest, subject to its overall limitation on
debt securities, in loan participations, typically made by a syndicate of banks
to governmental or corporate borrowers for a variety of purposes. The underlying
loans to developing market governmental borrowers may be in default and may be
subject to restructuring under the Brady Plan. The underlying loans may be
secured or unsecured, and will vary in term and legal structure. When purchasing
such instruments, the fund may assume the credit risks associated with the
original bank lender as well as the credit risks associated with the borrower.
Investment in loan participations presents the possibility that in the United
States, the fund could be held liable as a co-lender under emerging legal
theories of lender liability. In addition, if the loan is foreclosed, the fund
could be part owner of any collateral, and could bear the costs and liabilities
of owning and disposing of the collateral. Loan participations are generally not
rated by major rating agencies, may not be protected by securities laws and are
often considered to be illiquid.

CURRENCY TRANSACTIONS -- The fund may purchase and sell currencies to facilitate
securities transactions and enter into forward currency contracts to protect
against changes in currency exchange rates. A forward currency contract is an
obligation to purchase or sell a specific currency at a future date, which may
be any fixed number of days from the date of the contract agreed upon by the
parties, at a price set at the time of the contract. Forward currency contracts
entered into by the fund will involve the purchase or sale of one currency
against the U.S. dollar. While entering into forward currency transactions could
minimize the risk of loss due to a decline in the value of the hedged currency,
it could also limit any potential gain that may result from an

New World Fund -- Page 5
<PAGE>

increase in the value of the currency. The fund will not generally attempt to
protect against all potential changes in exchange rates. The fund will segregate
liquid assets that will be marked to market daily to meet its forward contract
commitments to the extent required by the Securities and Exchange Commission.

Certain provisions of the Internal Revenue Code may affect the extent to which
the fund may enter into forward contracts. Such transactions also may affect the
character and timing of income, gain or loss recognized by the fund for U.S.
federal income tax purposes.

WARRANTS AND RIGHTS -- The fund may purchase warrants, which may be issued
together with bonds or preferred stocks. Warrants generally entitle the holder
to buy a proportionate amount of common stock at a specified price, usually
higher than the current market price. Warrants may be issued with an expiration
date or in perpetuity. Rights are similar to warrants except that they normally
entitle the holder to purchase common stock at a lower price than the current
market price.

DEBT SECURITIES -- Debt securities are used by issuers to borrow money.
Generally, issuers pay investors periodic interest and repay the amount borrowed
either periodically during the life of the security and/or at maturity. Some
debt securities, such as zero coupon bonds, do not pay current interest, but are
purchased at a discount from their face values and accrue interest at the
applicable coupon rate over a specified time period. The market prices of debt
securities fluctuate depending on such factors as interest rates, credit quality
and maturity. In general, market prices of debt securities decline when interest
rates rise and increase when interest rates fall.

Lower rated debt securities, rated Ba or below by Moody's and/or BB or below by
S&P or unrated but determined to be of equivalent quality, are described by the
rating agencies as speculative and involve greater risk of default or price
changes due to changes in the issuer's creditworthiness than higher rated debt
securities, or they may already be in default. The market prices of these
securities may fluctuate more than higher quality securities and may decline
significantly in periods of general economic difficulty. It may be more
difficult to dispose of, and to determine the value of, lower rated debt
securities.

Certain additional risk factors relating to debt securities are discussed below:

SENSITIVITY TO INTEREST RATE AND ECONOMIC CHANGES -- Debt securities may be
sensitive to economic changes, political and corporate developments, and
interest rate changes. In addition, during an economic downturn or
substantial period of rising interest rates, issuers that are highly
leveraged may experience increased financial stress that would adversely
affect their ability to meet projected business goals, to obtain additional
financing and to service their principal and interest payment obligations.
Periods of economic change and uncertainty also can be expected to result
in increased volatility of market prices and yields of certain debt
securities.

PAYMENT EXPECTATIONS -- Debt securities may contain redemption or call
provisions. If an issuer exercises these provisions in a lower interest
rate market, the fund would have to replace the security with a lower
yielding security, resulting in decreased income to investors. If the
issuer of a debt security defaults on its obligations to pay interest or
principal or is the subject of bankruptcy proceedings, the fund may incur
losses or expenses in seeking recovery of amounts owed to it.

New World Fund -- Page 6
<PAGE>

LIQUIDITY AND VALUATION -- There may be little trading in the secondary
market for particular debt securities, which may affect adversely the
fund's ability to value accurately or dispose of such debt securities.
Adverse publicity and investor perceptions, whether or not based on
fundamental analysis, may decrease the value and/or liquidity of debt
securities.

The investment adviser attempts to reduce the risks described above through
diversification of the fund's portfolio and by credit analysis of each issuer,
as well as by monitoring broad economic trends and corporate and legislative
developments, but there can be no assurance that it will be successful in doing
so.

SECURITIES WITH EQUITY AND DEBT CHARACTERISTICS -- The fund may invest in
securities that have a combination of equity and debt characteristics. These
securities may at times behave more like equity than debt and vice versa. Some
types of convertible bonds or preferred stocks automatically convert into common
stocks. The prices and yields of nonconvertible preferred stocks generally move
with changes in interest rates and the issuer's credit quality, similar to the
factors affecting debt securities. Certain of these securities will be treated
as debt for fund investment limit purposes.

Convertible bonds, convertible preferred stocks and other securities may
sometimes be converted, or may automatically convert, into common stocks or
other securities at a stated conversion ratio. These securities, prior to
conversion, may pay a fixed rate of interest or a dividend. Because convertible
securities have both debt and equity characteristics, their value varies in
response to many factors, including the value of the underlying assets, general
market and economic conditions, and convertible market valuations, as well as
changes in interest rates, credit spreads and the credit quality of the issuer.

U.S. GOVERNMENT OBLIGATIONS -- U.S. government obligations are securities backed
by the full faith and credit of the U.S. government. U.S. government obligations
include the following types of securities:

U.S. TREASURY SECURITIES -- U.S. Treasury securities include direct
obligations of the U.S. Treasury, such as Treasury bills, notes and bonds.
For these securities, the payment of principal and interest is
unconditionally guaranteed by the U.S. government, and thus they are of the
highest possible credit quality. Such securities are subject to variations
in market value due to fluctuations in interest rates, but, if held to
maturity, will be paid in full.

FEDERAL AGENCY SECURITIES BACKED BY "FULL FAITH AND CREDIT" -- The
securities of certain U.S. government agencies and government-sponsored
entities are guaranteed as to the timely payment of principal and interest
by the full faith and credit of the U.S. government. Such agencies and
entities include the Government National Mortgage Association (Ginnie Mae),
the Veterans Administration (VA), the Federal Housing Administration (FHA),
the Export-Import Bank (Exim Bank), the Overseas Private Investment
Corporation (OPIC), the Commodity Credit Corporation (CCC) and the Small
Business Administration (SBA).

OTHER FEDERAL AGENCY OBLIGATIONS -- Additional federal agency securities are
neither direct obligations of, nor guaranteed by, the U.S. government. These
obligations include securities issued by certain U.S. government agencies and
government-sponsored entities. However, they generally involve some form of
federal sponsorship: some operate under a government charter,

New World Fund -- Page 7
<PAGE>

some are backed by specific types of collateral; some are supported by the
issuer's right to borrow from the Treasury; and others are supported only by the
credit of the issuing government agency or entity. These agencies and entities
include, but are not limited to: Federal Home Loan Bank, Federal Home Loan
Mortgage Corporation (Freddie Mac), Federal National Mortgage Association
(Fannie Mae), Tennessee Valley Authority and Federal Farm Credit Bank System.

FORWARD COMMITMENTS -- The fund may enter into commitments to purchase or sell
securities at a future date. When the fund agrees to purchase such securities,
it assumes the risk of any decline in value of the security from the date of the
agreement. When the fund agrees to sell such securities, it does not participate
in further gains or losses with respect to the securities beginning on the date
of the agreement. If the other party to such a transaction fails to deliver or
pay for the securities, the fund could miss a favorable price or yield
opportunity, or could experience a loss.

The fund will not use these transactions for the purpose of leveraging and will
segregate liquid assets that will be marked to market daily in an amount
sufficient to meet its payment obligations in these transactions. Although these
transactions will not be entered into for leveraging purposes, to the extent the
fund's aggregate commitments in connection with these transactions exceed its
segregated assets, the fund temporarily could be in a leveraged position
(because it may have an amount greater than its net assets subject to market
risk). Should market values of the fund's portfolio securities decline while the
fund is in a leveraged position, greater depreciation of its net assets would
likely occur than if it were not in such a position. The fund will not borrow
money to settle these transactions and, therefore, will liquidate other
portfolio securities in advance of settlement if necessary to generate
additional cash to meet its obligations.

CASH AND CASH EQUIVALENTS -- These include (a) commercial paper (for example,
short-term notes with maturities typically up to 12 months in length issued by
corporations, governmental bodies or bank/corporation sponsored conduits
(asset-backed commercial paper)) (b) short-term bank obligations (for example,
certificates of deposit, bankers' acceptances (time drafts on a commercial bank
where the bank accepts an irrevocable obligation to pay at maturity)) or bank
notes, (c) savings association and savings bank obligations (for example, bank
notes and certificates of deposit issued by savings banks or savings
associations), (d) securities of the U.S. government, its agencies or
instrumentalities that mature, or may be redeemed, in one year or less, and (e)
corporate bonds and notes that mature, or that may be redeemed, in one year or
less.

RESTRICTED OR ILLIQUID SECURITIES -- The fund may purchase securities subject to
restrictions on resale. Restricted securities generally can be sold in privately
negotiated transactions, pursuant to an exemption from registration under the
Securities Act of 1933 (the "1933 Act"), or in a registered public offering.
Where registration is required, the holder of a registered security may be
obligated to pay all or part of the registration expense and a considerable
period may elapse between the time it decides to seek registration and the time
it may be permitted to sell a security under an effective registration
statement. Difficulty in selling such securities may result in a loss or be
costly to the fund.

Securities (including restricted securities) not actively traded will be
considered illiquid unless they have been specifically determined to be liquid
under procedures adopted by the fund's Board of Directors, taking into account
factors such as the frequency and volume of trading, the commitment of dealers
to make markets and the availability of qualified investors, all of which can

New World Fund -- Page 8
<PAGE>

change from time to time. The fund may incur certain additional costs in
disposing of illiquid securities.

* * * * * *

PORTFOLIO TURNOVER -- Portfolio changes will be made without regard to the
length of time particular investments may have been held. Short-term trading
profits are not the fund's objective, and changes in its investments are
generally accomplished gradually, though short-term transactions may
occasionally be made. High portfolio turnover involves correspondingly greater
transaction costs in the form of dealer spreads or brokerage commissions, and
may result in the realization of net capital gains, which are taxable when
distributed to shareholders.

A fund's portfolio turnover rate would equal 100% if each security in the fund's
portfolio were replaced once per year. The fund's portfolio turnover rates for
the fiscal years ended October 31, 2005 and 2004 were 26% and 20%, respectively.
See "Financial highlights" in the prospectus for the fund's annual portfolio
turnover rate for previous periods.

FUNDAMENTAL POLICIES AND INVESTMENT RESTRICTIONS
FUNDAMENTAL POLICIES -- The fund has adopted the following fundamental policies
and investment restrictions, which may not be changed without approval by
holders of a majority of its outstanding shares. Such majority is defined in the
Investment Company Act of 1940, as amended (the "1940 Act"), as the vote of the
lesser of (a) 67% or more of the outstanding voting securities present at a
meeting, if the holders of more than 50% of the outstanding voting securities
are present in person or by proxy, or (b) more than 50% of the outstanding
voting securities. All percentage limitations are considered at the time
securities are purchased and are based on the fund's net assets unless otherwise
indicated. None of the following investment restrictions involving a maximum
percentage of assets will be considered violated unless the excess occurs
immediately after, and is caused by, an acquisition by the fund.

1. The fund may not borrow money or securities, except for temporary or
emergency purposes in an amount not exceeding 33-1/3% of its total assets.

2. The fund may not make loans, if, as a result, more than 33-1/3% of its
total assets would be lent to other parties (this limitation does not apply to
purchases of debt securities, repurchase agreements or loans of portfolio
securities).

3. The fund may not invest 25% or more of its assets in securities of issuers
in any one industry (other than securities issued or guaranteed by the U.S.
government, its agencies or instrumentalities).

4. The fund may not purchase or sell real estate unless acquired as a result
of ownership of securities or other instruments (this shall not prevent the fund
from investing in securities or other instruments backed by real estate or
securities of companies engaged in the real estate business, such as real estate
investment trusts).

5. The fund may not purchase or sell physical commodities unless acquired as a
result of ownership of securities or other instruments (this shall not prevent
the fund from purchasing or selling options and futures contracts or from
investing in securities or other instruments backed by physical commodities).

New World Fund -- Page 9
<PAGE>

6. The fund may not engage in the business of underwriting securities of other
issuers, except to the extent that the purchase or disposal of an investment
position may technically constitute the fund as an underwriter as that term is
defined under the Securities Act of 1933.

7. The fund may not issue senior securities, except as permitted under the
Investment Company Act of 1940.

In addition, the fund will not change its subclassification from a diversified
to non-diversified company except as permitted under the Investment Company Act
of 1940.

NONFUNDAMENTAL POLICIES -- The following nonfundamental policies may be changed
without shareholder approval:

1. The fund may not with respect to 75% of its total assets, invest more than
5% of its assets in securities of any one issuer or acquire more than 10% of the
voting securities of any one issuer. These limitations do not apply to
securities issued or guaranteed by the U.S. government, its agencies or
instrumentalities.

2. The fund may not invest more than 15% of its net assets in securities which
are not readily marketable.

3. The fund may not purchase securities on margin, except for such short-term
credits as are necessary for the clearance of transactions, and provided that
the fund may make margin payments in connection with purchases or sales of
futures contracts or of options on futures contracts.

4. The fund may not engage in short sales except to the extent it owns or has
the right to obtain securities equivalent in kind and amount to those sold
short.

5. The fund may not invest in other companies for the purpose of exercising
control or management.

6. The fund may not invest more than 5% of its total assets in the securities
of other managed investment companies; such investments shall be limited to 3%
of the voting stock of any investment company, provided, however, that
investment in the open market of a closed-end investment company where no more
than customary brokers' commissions are involved and investment in connection
with a merger, consolidation, acquisition or reorganization shall not be
prohibited by this restriction.

New World Fund -- Page 10
<PAGE>

MANAGEMENT OF THE FUND

BOARD OF DIRECTORS AND OFFICERS

YEAR FIRST NUMBER OF PORTFOLIOS
POSITION ELECTED WITHIN THE FUND
WITH THE A DIRECTOR PRINCIPAL OCCUPATION(S) DURING COMPLEX/2/ OVERSEEN
NAME AND AGE FUND OF THE FUND/1/ PAST FIVE YEARS BY DIRECTOR
-------------------------------------------------------------------------------------------------------------------

"NON-INTERESTED" DIRECTORS/4/
-------------------------------------------------------------------------------------------------------------------

Elisabeth Allison Director 1999 Partner, ANZI, Ltd. (transactional 3
Age: 59 work specializing in joint ventures
and strategic alliances); Business
negotiator, Harvard Medical School
----------------------
---------------------------------------------------------------------------------------------
Vanessa C.L. Chang Director 2005 Director, EL & EL Investments (real 3
Age: 53 estate); former President and CEO,
ResolveItNow.com (insurance-related
Internet company)
----------------------
---------------------------------------------------------------------------------------------
Robert A. Fox Director 1999 Managing General Partner, Fox 7
Age: 68 Investments LP; retired President
and CEO, Foster Farms (poultry
producer)
-------------------------------------------------------------------------------------------------------------------
Jae H. Hyun Director 2005 Chairman of the Board, Tong Yang 3
Age: 56 Major Corp. (financial services)
-------------------------------------------------------------------------------------------------------------------
Koichi Itoh Director 1999 Executive Chairman of the Board, 5
Age: 65 Itoh Building Co., Ltd. (building
management); former President,
Autosplice KK (electronics)
-------------------------------------------------------------------------------------------------------------------
William H. Kling Director 1999 President, American Public Media 6
Age: 63 Group
-------------------------------------------------------------------------------------------------------------------
John G. McDonald Director 1999 Professor of Finance, Graduate 8
Age: 68 School of Business, Stanford
University
-------------------------------------------------------------------------------------------------------------------
William I. Miller Chairman of 1999 Chairman of the Board, Irwin 3
Age: 49 the Board Financial Corporation
(Independent
and
Non-Executive)
-------------------------------------------------------------------------------------------------------------------
Alessandro Ovi Director 2001 Special Advisor to the President of 3
Age: 61 the European Commission; former
CEO, Tecnitel (subsidiary of a
telecommunications company)
-------------------------------------------------------------------------------------------------------------------
Kirk P. Pendleton Director 1999 Chairman of the Board and CEO, 6
Age: 66 Cairnwood, Inc. (venture capital
investment)
-------------------------------------------------------------------------------------------------------------------
Rozanne L. Ridgway Director 2005 Director of companies; Chair 3
Age: 70 (non-executive), Baltic-American
Enterprise Fund; former Co-Chair,
Atlantic Council of the United
States
-------------------------------------------------------------------------------------------------------------------

OTHER DIRECTORSHIPS/3/ HELD
NAME AND AGE BY DIRECTOR
-----------------------------------------------------
"NON-INTERESTED" DIRECTORS/4/
-----------------------------------------------------

Elisabeth Allison Color Kinetics, Inc.
Age: 59
-----------------------------------------------------
Vanessa C.L. Chang None
Age: 53
-----------------------------------------------------
Robert A. Fox Chemtura Corporation
Age: 68
-----------------------------------------------------
Jae H. Hyun Tong Yang Investment Bank;
Age: 56 Tong Yang Magic, Inc.; Tong
Yang Systems Corp.
-----------------------------------------------------
Koichi Itoh None
Age: 65
-----------------------------------------------------
William H. Kling Irwin Financial Corporation
Age: 63
-----------------------------------------------------
John G. McDonald iStar Financial, Inc.; Plum
Age: 68 Creek Timber Co.; Scholastic
Corporation; Varian, Inc.

-----------------------------------------------------
William I. Miller Cummins, Inc.
Age: 49
-----------------------------------------------------
Alessandro Ovi SEAT (Telecom Italia); ST
Age: 61 Microelectronics
-----------------------------------------------------
Kirk P. Pendleton None
Age: 66
-----------------------------------------------------
Rozanne L. Ridgway Boeing; 3M Corporation;
Age: 70 Emerson Electric; Manpower,
Inc.; Sara Lee Corporation

-----------------------------------------------------

New World Fund -- Page 11

<PAGE>

[This page intentionally left blank for this filing.]

New World Fund -- Page 12

<PAGE>

PRINCIPAL OCCUPATION(S) DURING
YEAR FIRST PAST FIVE YEARS AND
ELECTED POSITIONS HELD NUMBER OF PORTFOLIOS
POSITION A DIRECTOR WITH AFFILIATED ENTITIES WITHIN THE FUND
WITH THE AND/OR OFFICER OR THE PRINCIPAL UNDERWRITER COMPLEX/2/ OVERSEEN
NAME AND AGE FUND OF THE FUND/1/ OF THE FUND BY DIRECTOR
--------------------------------------------------------------------------------------------------------------

"INTERESTED" DIRECTORS/5,6/
--------------------------------------------------------------------------------------------------------------

Gina H. Despres Vice 1999 Senior Vice President, Capital 4
Age: 64 Chairman of Research and Management
the Board Company; Senior Vice President,
Capital Strategy Research,
Inc.*
--------------------------------------------------------------------------------------------------------------
Robert W. Lovelace President 1999 Senior Vice President, Capital 1
Age: 43 and Research and Management
Director Company; Chairman of the Board,
Capital Research Company*;
Director, The Capital Group
Companies, Inc.*
--------------------------------------------------------------------------------------------------------------

OTHER DIRECTORSHIPS/3/ HELD
NAME AND AGE BY DIRECTOR
---------------------------------------------------
"INTERESTED" DIRECTORS/5,6/
---------------------------------------------------

Gina H. Despres None
Age: 64
---------------------------------------------------
Robert W. Lovelace None
Age: 43
---------------------------------------------------

PRINCIPAL OCCUPATION(S) DURING
POSITION YEAR FIRST ELECTED PAST FIVE YEARS AND POSITIONS HELD
WITH THE AN OFFICER WITH AFFILIATED ENTITIES
NAME AND AGE FUND OF THE FUND/1/ OR THE PRINCIPAL UNDERWRITER OF THE FUND
-----------------------------------------------------------------------------------------------------------------------------------
OTHER OFFICERS/6/
-----------------------------------------------------------------------------------------------------------------------------------

Mark E. Denning Senior Vice 1999 Director, Capital Research and Management Company; Director,
Age: 48 President The Capital Group Companies, Inc.*; Senior Vice President,
Capital Research Company*
-----------------------------------------------------------------------------------------------------------------------------------
David C. Barclay Vice President 1999 Senior Vice President, Capital Research and Management
Age: 49 Company; Director, The Capital Group Companies, Inc.*
-----------------------------------------------------------------------------------------------------------------------------------
Michael J. Downer Vice President 2003 Vice President and Secretary, Capital Research and Management
Age: 50 Company; Secretary and Director, American Funds Distributors,
Inc.*; Director, Capital Bank and Trust Company*
-----------------------------------------------------------------------------------------------------------------------------------
Alwyn Heong Vice President 1999 Senior Vice President, Capital Research Company*
Age: 45
-----------------------------------------------------------------------------------------------------------------------------------
Joseph R. Higdon Vice President 1999 Senior Vice President, Capital Research Company*; Senior Vice
Age: 64 President and Director, Capital Strategy Research, Inc.*
-----------------------------------------------------------------------------------------------------------------------------------
Carl M. Kawaja Vice President 1999 Senior Vice President, Capital Research Company*; Director,
Age: 41 Capital International, Inc.*
-----------------------------------------------------------------------------------------------------------------------------------
Vincent P. Corti Secretary 1999 Vice President - Fund Business Management Group, Capital
Age: 49 Research and Management Company
-----------------------------------------------------------------------------------------------------------------------------------
R. Marcia Gould Treasurer 1999 Vice President - Fund Business Management Group, Capital
Age: 51 Research and Management Company
-----------------------------------------------------------------------------------------------------------------------------------
Jennifer M. Buchheim Assistant Treasurer 2005 Vice President - Fund Business Management Group, Capital
Age: 32 Research and Management Company
-----------------------------------------------------------------------------------------------------------------------------------

New World Fund -- Page 13

<PAGE>

* Company affiliated with Capital Research and Management Company.
1 Directors and officers of the fund serve until their resignation, removal or
retirement.
2 Capital Research and Management Company manages the American Funds, consisting
of 29 funds. Capital Research and Management Company also manages American
Funds Insurance Series,(R) which serves as the underlying investment vehicle
for certain variable insurance contracts, and Endowments, whose shareholders
are limited to certain nonprofit organizations.
3 This includes all directorships (other than those of the American Funds) that
are held by each Director as a director of a public company or a registered
investment company.
4 A "Non-Interested" Director refers to a Director who is not an "interested
person" within the meaning of the 1940 Act, on the basis of his or her
affiliation with the fund's investment adviser, Capital Research and Management
Company, or affiliated entities (including the fund's principal underwriter).

5 "Interested persons," within the meaning of the 1940 Act, on the basis of
their affiliation with the fund's investment adviser, Capital Research and
Management Company, or affiliated entities (including the fund's principal
underwriter).
6 All of the officers listed, with the exception of Joseph R. Higdon, are
officers and/or Directors/Trustees of one or more of the other funds for which
Capital Research and Management Company serves as investment adviser.

THE ADDRESS FOR ALL DIRECTORS AND OFFICERS OF THE FUND IS 333 SOUTH HOPE STREET,
55TH FLOOR, LOS ANGELES, CALIFORNIA 90071, ATTENTION: FUND SECRETARY.

New World Fund -- Page 14

<PAGE>

FUND SHARES OWNED BY DIRECTORS AS OF DECEMBER 31, 2004

AGGREGATE DOLLAR RANGE/1/
OF SHARES
OWNED IN ALL FUNDS
IN THE AMERICAN FUNDS
DOLLAR RANGE/1/ OF FUND FAMILY OVERSEEN
NAME SHARES OWNED BY DIRECTOR
-------------------------------------------------------------------------------

"NON-INTERESTED" DIRECTORS
-------------------------------------------------------------------------------
Elisabeth Allison Over $100,000 Over $100,000
-------------------------------------------------------------------------------
Vanessa C.L. Chang/2/ $10,001 - $50,000 Over $100,000
-------------------------------------------------------------------------------
Robert A. Fox Over $100,000 Over $100,000
-------------------------------------------------------------------------------
Jae H. Hyun/2/ None Over $100,000
-------------------------------------------------------------------------------
Koichi Itoh $50,001 - $100,000 Over $100,000
-------------------------------------------------------------------------------
William H. Kling Over $100,000 Over $100,000
-------------------------------------------------------------------------------
John G. McDonald Over $100,000 Over $100,000
-------------------------------------------------------------------------------
William I. Miller Over $100,000 Over $100,000
-------------------------------------------------------------------------------
Alessandro Ovi $10,001 - $50,000 $50,001 - $100,000
-------------------------------------------------------------------------------
Kirk P. Pendleton Over $100,000 Over $100,000
-------------------------------------------------------------------------------
Rozanne L. Ridgway/2/ None/3/ $50,001 - $100,000/3/
-------------------------------------------------------------------------------
"INTERESTED" DIRECTORS
-------------------------------------------------------------------------------
Gina H. Despres Over $100,000 Over $100,000
-------------------------------------------------------------------------------
Robert W. Lovelace Over $100,000 Over $100,000
-------------------------------------------------------------------------------

1 Ownership disclosure is made using the following ranges: None; $1 - $10,000;
$10,001 - $50,000; $50,001 - $100,000; and Over $100,000. The amounts listed
for "interested" Directors include shares owned through The Capital Group
Companies, Inc. retirement plan and 401(k) plan.
2 Elected a Director effective March 9, 2005.
3 As of December 28, 2005, the dollar range of fund shares owned was $10,001 -
$50,000 and the aggregate holdings of American Funds overseen by the director
was greater than $100,000.

DIRECTOR COMPENSATION -- No compensation is paid by the fund to any officer or
Director who is a director, officer or employee of the investment adviser or its
affiliates. The fund typically pays each Non-Interested Director an annual fee
of $10,000. If the aggregate annual fees paid to a Non-Interested Director by
all funds advised by the investment adviser is less than $60,000, that
Non-Interested Director would be eligible for a $60,000 alternative fee. This
alternative fee is paid by those funds for which the Non-Interested Director
serves as a director on a pro rata basis according to each fund's relative share
of the annual fees that it would typically pay. The alternative fee reflects the
significant time and labor commitment required for a Director to oversee even
one fund. A Non-Interested Director who is Chairman of the Board also receives
an additional annual fee of $25,000, paid in equal portions by the fund and the
funds whose Boards and Committees typically meet jointly with those of the fund.

New World Fund -- Page 15
<PAGE>

In addition, the fund pays to Non-Interested Directors fees of (a) $2,000 for
each Board of Directors meeting attended and (b) $1,000 for each meeting
attended as a member of a committee of the Board of Directors.

Non-Interested Directors also receive attendance fees of (a) $2,500 for each
Director seminar or information session organized by the investment adviser, (b)
$1,500 for each joint Audit Committee meeting with all other American Funds audit
committees and (c) $500 for each meeting of the Board or Committee Chairs of
other American Funds. The fund and the other funds served by each Non-Interested
Director each pay an equal portion of these attendance fees.

The Nominating Committee of the Board of Directors, a Committee comprised
exclusively of Non-Interested Directors, reviews Director compensation
periodically, and typically recommends adjustments every other year. In making
its recommendations, the Nominating Committee considers a number of factors,
including operational, regulatory and other developments affecting the
complexity of the Board's oversight obligations, as well as comparative industry
data.

No pension or retirement benefits are accrued as part of fund expenses.
Non-Interested Directors may elect, on a voluntary basis, to defer all or a
portion of their fees through a deferred compensation plan in effect for the
fund. The fund also reimburses certain expenses of the Non-Interested Directors.

DIRECTOR COMPENSATION PAID DURING THE FISCAL YEAR ENDED OCTOBER 31, 2005

TOTAL COMPENSATION (INCLUDING
AGGREGATE COMPENSATION VOLUNTARILY DEFERRED
(INCLUDING VOLUNTARILY COMPENSATION/1/)
DEFERRED COMPENSATION/1/) FROM ALL FUNDS MANAGED BY
NAME FROM THE FUND CAPITAL RESEARCH AND
------------------------------------------------------------------------------------------------------- MANAGEMENT
COMPANY OR ITS AFFILIATES/2/
-----------------------------

Elisabeth Allison $28,167 $113,500
------------------------------------------------------------------------------------------------------------------------------------
Vanessa C.L. Chang 17,167 95,500
------------------------------------------------------------------------------------------------------------------------------------
Robert A. Fox/3/ 25,927 272,500
------------------------------------------------------------------------------------------------------------------------------------
Jae H. Hyun 12,000 77,000
------------------------------------------------------------------------------------------------------------------------------------
Koichi Itoh/3/ 27,167 116,001
------------------------------------------------------------------------------------------------------------------------------------
William H. Kling/3/ 23,067 154,000
------------------------------------------------------------------------------------------------------------------------------------
John G. McDonald/3/ 21,563 334,500
------------------------------------------------------------------------------------------------------------------------------------
William I. Miller/3/ 23,000 96,000
------------------------------------------------------------------------------------------------------------------------------------
Alessandro Ovi/3/ 26,434 96,100
------------------------------------------------------------------------------------------------------------------------------------
Kirk P. Pendleton/3/ 27,150 216,500
------------------------------------------------------------------------------------------------------------------------------------
Rozanne L. Ridgway/3/ 17,167 91,500
------------------------------------------------------------------------------------------------------------------------------------

1 Amounts may be deferred by eligible Directors under a nonqualified deferred
compensation plan adopted by the fund in 1999. Deferred amounts accumulate at
an earnings rate determined by the total return of one or more American Funds
as designated by the Directors. Compensation shown in this table for the fiscal
year ended October 31, 2005 does not include earnings on amounts deferred in
previous fiscal years. See footnote 3 to this table for more information.
2 Capital Research and Management Company manages the American Funds, consisting
of 29 funds. Capital Research and

New World Fund -- Page 16
<PAGE>

Management Company also manages American Funds Insurance Series,(R) which
serves as the underlying investment vehicle for certain variable insurance
contracts, and Endowments, whose shareholders are limited to certain nonprofit
organizations.
3 Since the deferred compensation plan's adoption, the total amount of deferred
compensation accrued by the fund (plus earnings thereon) through the 2005
fiscal year for participating Directors is as follows: Robert A. Fox
($174,870), Koichi Itoh ($186,705), William H. Kling ($89,913), John G.
McDonald ($130,254), William I. Miller ($96,594), Alessandro Ovi ($22,785),
Kirk P. Pendleton ($188,531) and Rozanne L. Ridgway ($18,419). Amounts deferred
and accumulated earnings thereon are not funded and are general unsecured
liabilities of the fund until paid to the Directors.

As of December 1, 2005, the officers and Directors of the fund and their
families, as a group, owned beneficially or of record less than 1% of the
outstanding shares of the fund.

FUND ORGANIZATION AND THE BOARD OF DIRECTORS -- The fund, an open-end,
diversified management investment company, was organized as a Maryland
corporation on November 13, 1998. Although the Board of Directors has delegated
day-to-day oversight to the investment adviser, all fund operations are
supervised by the fund's Board, which meets periodically and performs duties
required by applicable state and federal laws.

Under Maryland law, the business affairs of a fund are managed under the
direction of the Board of Directors, and all powers of the fund are exercised by
or under the authority of the Board except as reserved to the shareholders by
law or the fund's charter or by-laws. Maryland law requires each Director to
perform his/her duties as a Director, including his/her duties as a member of
any Board committee on which he/she serves, in good faith, in a manner he/she
reasonably believes to be in the best interest of the fund, and with the care
that an ordinarily prudent person in a like position would use under similar
circumstances.

Members of the Board who are not employed by the investment adviser or its
affiliates are paid certain fees for services rendered to the fund as described
above. They may elect to defer all or a portion of these fees through a deferred
compensation plan in effect for the fund.

The fund has several different classes of shares, including Class A, B, C, F,
529-A, 529-B, 529-C, 529-E, 529-F, R-1, R-2, R-3, R-4 and R-5 shares. The 529
share classes are available only through CollegeAmerica/(R)/ to investors
establishing qualified higher education savings accounts. The R share classes
are generally available only to employer-sponsored retirement plans. Class R-5
shares are also available to clients of the Personal Investment Management group
of Capital Guardian Trust Company who do not have an intermediary associated
with their accounts and without regard to the $1 million purchase minimum.

Shares of each class represent an interest in the same investment portfolio.
Each class has pro rata rights as to voting, redemption, dividends and
liquidation, except that each class bears different distribution expenses and
may bear different transfer agent fees and other expenses properly attributable
to the particular class as approved by the Board of Directors and set forth in
the fund's rule 18f-3 Plan. Each class' shareholders have exclusive voting
rights with respect to the respective class' rule 12b-1 plans adopted in
connection with the distribution of shares and on other matters in which the
interests of one class are different from interests in another class. Shares of
all classes of the fund vote together on matters that affect all classes in
substantially the same manner. Each class votes as a class on matters that
affect that class alone. Note that CollegeAmerica account owners are not
shareholders of the fund and, accordingly, do not have the rights of a
shareholder, such as the right to vote proxies relating to fund shares. As the
legal owner of the fund's shares, the Virginia College Savings Plan/SM/ will
vote any proxies relating to fund shares.

New World Fund -- Page 17
<PAGE>

The fund does not hold annual meetings of shareholders. However, significant
matters that require shareholder approval, such as certain elections of Board
members or a change in a fundamental investment policy, will be presented to
shareholders at a meeting called for such purpose. Shareholders have one vote
per share owned. At the request of the holders of at least 10% of the shares,
the fund will hold a meeting at which any member of the Board could be removed
by a majority vote.

The fund's Articles of Incorporation and by-laws as well as separate
indemnification agreements that the fund has entered into with Non-Interested
Directors provide in effect that, subject to certain conditions, the fund will
indemnify its officers and Directors against liabilities or expenses actually
and reasonably incurred by them relating to their service to the fund. However,
Directors are not protected from liability by reason of their willful
misfeasance, bad faith, gross negligence or reckless disregard of the duties
involved in the conduct of their office.

COMMITTEES OF THE BOARD OF DIRECTORS -- The fund has an Audit Committee
comprised of Elisabeth Allison, Vanessa C.L. Chang, Robert A. Fox, Kirk P.
Pendleton and Rozanne L. Ridgway, none of whom is an "interested person" of the
fund within the meaning of the 1940 Act. The Committee provides oversight
regarding the fund's accounting and financial reporting policies and practices,
its internal controls and the internal controls of the fund's principal service
providers. The Committee acts as a liaison between the fund's independent
registered public accounting firm and the full Board of Directors. Four Audit
Committee meetings were held during the 2005 fiscal year.

The fund has a Governance and Contracts Committee comprised of Elisabeth
Allison, Vanessa C.L. Chang, Robert A. Fox, Jae H. Hyun, Koichi Itoh, William H.
Kling, John G. McDonald, William I. Miller, Alessandro Ovi, Kirk P. Pendleton
and Rozanne L. Ridgway, none of whom is an "interested person" of the fund
within the meaning of the 1940 Act. The Committee's principal function is to
request, review and consider the information deemed necessary to evaluate the
terms of certain agreements between the fund and its investment adviser or the
investment adviser's affiliates, such as the Investment Advisory and Service
Agreement, Principal Underwriting Agreement, Administrative Services Agreement
and Plans of Distribution adopted pursuant to rule 12b-1 under the 1940 Act,
that the fund may enter into, renew or continue, and to make its recommendations
to the full Board of Directors on these matters. Three Governance and Contracts
Committee meetings were held during the 2005 fiscal year.

The fund has a Nominating Committee comprised of Jae H. Hyun, Koichi Itoh,
William H. Kling, John G. McDonald and Alessandro Ovi, none of whom is an
"interested person" of the fund within the meaning of the 1940 Act. The
Committee periodically reviews such issues as the Board's composition,
responsibilities, committees, compensation and other relevant issues, and
recommends any appropriate changes to the full Board of Directors. The Committee
also evaluates, selects and nominates Non-Interested Director candidates to the
full Board of Directors. While the Committee normally is able to identify from
its own and other resources an ample number of qualified candidates, it will
consider shareholder suggestions of persons to be considered as nominees to fill
future vacancies on the Board. Such suggestions must be sent in writing to the
Nominating Committee of the fund, addressed to the fund's Secretary, and must be
accompanied by complete biographical and occupational data on the prospective
nominee, along with a written consent of the prospective nominee for
consideration of his or her name by the Committee. One Nominating Committee
meeting was held during the 2005 fiscal year.

New World Fund -- Page 18
<PAGE>

PROXY VOTING PROCEDURES AND GUIDELINES -- The fund and its investment adviser
have adopted Proxy Voting Guidelines (the "Guidelines") with respect to voting
proxies of securities held by the fund, other American Funds, Endowments and
American Funds Insurance Series. Certain American Funds have established
separate proxy committees that vote proxies or delegate to a voting officer the
authority to vote on behalf of those funds. Proxies for all other funds are
voted by a committee of the investment adviser under authority delegated by
those funds' Boards. Therefore, if more than one fund invests in the same
company, they may vote differently on the same proposal.

All U.S. proxies are voted. Non-U.S. proxies also are voted, provided there is
sufficient time and information available. After a proxy is received, the
investment adviser prepares a summary of the proposals in the proxy. A
discussion of any potential conflicts of interest is also included in the
summary. After reviewing the summary, one or more research analysts familiar
with the company and industry make a voting recommendation on the proxy
proposals. A second recommendation is made by a proxy coordinator (a senior
investment professional) based on the individual's knowledge of the Guidelines
and familiarity with proxy-related issues. The proxy summary and voting
recommendations are then sent to the appropriate proxy voting committee for the
final voting decision.

The analyst and proxy coordinator making voting recommendations are responsible
for noting any potential material conflicts of interest. One example might be
where a director of one or more American Funds is also a director of a company
whose proxy is being voted. In such instances, proxy committee members are
alerted to the potential conflict. The proxy committee may then elect to vote
the proxy or seek a third-party recommendation or vote of an ad hoc group of
committee members.

The Guidelines, which have been in effect in substantially their current form
for many years, provide an important framework for analysis and decision-making
by all funds. However, they are not exhaustive and do not address all potential
issues. The Guidelines provide a certain amount of flexibility so that all
relevant facts and circumstances can be considered in connection with every
vote. As a result, each proxy received is voted on a case-by-case basis
considering the specific circumstances of each proposal. The voting process
reflects the funds' understanding of the company's business, its management and
its relationship with shareholders over time.

Information regarding how the fund voted proxies relating to portfolio
securities during the 12-month period ended June 30 of each year will be
available on or about September 1 of each year (a) without charge, upon request
by calling American Funds Service Company at 800/421-0180 and (b) on the SEC's
website at www.sec.gov.

The following summary sets forth the general positions of the American Funds,
Endowments, American Funds Insurance Series and the investment adviser on
various proposals. A copy of the full Guidelines is available upon request, free
of charge, by calling American Funds Service Company at 800/421-0180 or visiting
the American Funds website.

DIRECTOR MATTERS -- The election of a company's slate of nominees for
director is generally supported. Votes may be withheld for some or all of
the nominees if this is determined to be in the best interest of
shareholders. Separation of the chairman and CEO positions may also be
supported. Typically, proposals to declassify the board (elect all
directors annually) are supported based on the belief that this increases
the directors' sense of accountability to shareholders.

New World Fund -- Page 19
<PAGE>

SHAREHOLDER RIGHTS -- Proposals to repeal an existing poison pill, to
provide for confidential voting and to provide for cumulative voting are
usually supported. Proposals to eliminate the right of shareholders to act
by written consent or to take away a shareholder's right to call a special
meeting are not typically supported.

COMPENSATION AND BENEFIT PLANS -- Option plans are complicated, and many
factors are considered in evaluating a plan. Each plan is evaluated based
on protecting shareholder interests and a knowledge of the company and its
management. Considerations include the pricing (or repricing) of options
awarded under the plan and the impact of dilution on existing shareholders
from past and future equity awards. Compensation packages should be
structured to attract, motivate and retain existing employees and qualified
directors; however, they should not be excessive.

ROUTINE MATTERS -- The ratification of auditors, procedural matters
relating to the annual meeting and changes to company name are examples of
items considered routine. Such items are generally voted in favor of
management's recommendations unless circumstances indicate otherwise.

PRINCIPAL FUND SHAREHOLDERS -- The following table identifies those investors
who own of record or are known by the fund to own beneficially 5% or more of any
class of its shares as of the opening of business on December 1, 2005. Unless
otherwise indicated, the ownership percentages below represent ownership of
record rather than beneficial ownership.

NAME AND ADDRESS OWNERSHIP PERCENTAGE
----------------------------------------------------------------------------

Edward D. Jones & Co. Class A 15.34%
201 Progress Parkway Class B 9.63
Maryland Heights, MO 63043-3009
----------------------------------------------------------------------------
Citigroup Global Markets, Inc. Class C 10.95
333 W. 34th Street
New York, NY 10001-2402
----------------------------------------------------------------------------
MLPF&S Class C 9.31
4800 Deer Lake Drive East, Floor 2
Jacksonville, FL 32246-6484
----------------------------------------------------------------------------
Charles Schwab & Co., Inc. Class F 7.16
101 Montgomery Street
San Francisco, CA 94104-4122
----------------------------------------------------------------------------
RBC Dain Rauscher, Inc. Class R-1 11.73
10831 Summitview Road
Yakima, WA 98908-8703
----------------------------------------------------------------------------
Raymond James & Associates, Inc. Class R-1 11.68
880 Carillon Parkway
St. Petersburg, FL 33716-1100
----------------------------------------------------------------------------
Panzer Nursery, Inc. Class R-1 8.75
17980 SW Baseline Road
Beaverton, OR 97006-3760
----------------------------------------------------------------------------
Curiale Dellaverson Hirschfeld Kraemer & Sloan Class R-1 5.47
111 Sutter Street, Floor 1800
San Francisco, CA 94104-4545
----------------------------------------------------------------------------
JP Morgan Chase Class R-4 13.80
P.O. Box 419692
Kansas City, MO 64141-6692
----------------------------------------------------------------------------
MCB TR Services Class R-4 8.51
1414 9th Avenue
Altoona, PA 16602
----------------------------------------------------------------------------
CGTC Class R-5 34.10
333 S. Hope Street, Floor 49
Los Angeles, CA 90071
----------------------------------------------------------------------------
Fidelity Investments Institutional Operations Co. Class R-5 29.61
100 Magellan Way KWIC
Covington, KY 41015
----------------------------------------------------------------------------
UBS Financial Services, Inc. Class R-5 7.93
P.O. Box 92994
Chicago, IL 60675-2994
----------------------------------------------------------------------------

New World Fund -- Page 20
<PAGE>

INVESTMENT ADVISER -- The investment adviser, Capital Research and Management
Company, founded in 1931, maintains research facilities in the United States and
abroad (Los Angeles; San Francisco; New York; Washington, DC; London; Geneva;
Hong Kong; Singapore; and Tokyo) with a staff of professionals, many of whom
have significant investment experience. The investment adviser is located at 333
South Hope Street, Los Angeles, CA 90071, 135 South State College Boulevard,
Brea, CA 92821 and 5300 Robin Hood Road, Norfolk, VA 23513. The investment
adviser's research professionals travel several million miles a year, making
more than 5,000 research visits in more than 50 countries around the world. The
investment adviser believes that it is able to attract and retain quality
personnel. The investment adviser is a wholly owned subsidiary of The Capital
Group Companies, Inc.

The investment adviser is responsible for managing more than $650 billion of
stocks, bonds and money market instruments and serves over 30 million
shareholder accounts of all types throughout the world. These investors include
individuals, privately owned businesses and large corporations, as well as
schools, colleges, foundations and other nonprofit and tax-exempt organizations.

POTENTIAL CONFLICTS OF INTEREST -- The investment adviser has adopted policies
and procedures that address conflicts of interest that may arise between a
portfolio counselor's management of the fund and his or her management of other
funds and accounts. Potential areas of conflict could involve allocation of
investment opportunities and trades among funds and accounts, use of information
regarding the timing of fund trades, personal investing activities, portfolio
counselor compensation and proxy voting of portfolio securities. The investment
adviser has adopted policies and procedures that it believes are reasonably
designed to address these conflicts. However, there is no guarantee that such
policies and procedures will be effective or that the investment adviser will
anticipate all potential conflicts of interest.

New World Fund -- Page 21
<PAGE>

COMPENSATION OF INVESTMENT PROFESSIONALS -- As described in the prospectus, the
investment adviser uses a system of multiple portfolio counselors in managing
fund assets. In addition, Capital Research and Management Company's investment
analysts may make investment decisions with respect to a portion of a fund's
portfolio within their research coverage. Portfolio counselors and investment
analysts may also manage assets in other mutual funds advised by Capital
Research and Management Company.

Portfolio counselors and investment analysts are paid competitive salaries by
Capital Research and Management Company. In addition, they may receive bonuses
based on their individual portfolio results. Investment professionals also may
participate in profit-sharing plans. The relative mix of compensation
represented by bonuses, salary and profit-sharing will vary depending on the
individual's portfolio results, contributions to the organization and other
factors. In order to encourage a long-term focus, bonuses based on investment
results are calculated by comparing pretax total returns to relevant benchmarks
over both the most recent year and a four-year rolling average, with the greater
weight placed on the four-year rolling average. For portfolio counselors,
benchmarks may include measures of the marketplaces in which the relevant fund
invests and measures of the results of comparable mutual funds. For investment
analysts, benchmarks may include relevant market measures and appropriate
industry or sector indexes reflecting their areas of expertise. Capital Research
and Management Company also separately compensates analysts for the quality of
their research efforts. The benchmarks against which New World Fund portfolio
counselors are measured include: MSCI All Country World Index; Lipper Global
Funds Index; Lipper Emerging Markets Funds Index; and JP Morgan Emerging Markets
Bond Index Global.

PORTFOLIO COUNSELOR FUND HOLDINGS AND OTHER MANAGED ACCOUNTS -- As described
below, portfolio counselors may personally own shares of the fund. In addition,
portfolio counselors may manage a portion of other mutual funds or accounts
advised by Capital Research and Management Company or its affiliates.

New World Fund -- Page 22
<PAGE>

THE FOLLOWING TABLE REFLECTS INFORMATION AS OF OCTOBER 31, 2005:

NUMBER NUMBER
OF OTHER OF OTHER NUMBER
REGISTERED POOLED OF OTHER
INVESTMENT INVESTMENT ACCOUNTS
COMPANIES (RICS) VEHICLES (PIVS) THAT
THAT THAT PORTFOLIO
PORTFOLIO PORTFOLIO COUNSELOR
DOLLAR RANGE COUNSELOR COUNSELOR MANAGES
OF FUND MANAGES MANAGES (ASSETS OF
PORTFOLIO SHARES (ASSETS OF RICS (ASSETS OF PIVS OTHER ACCOUNTS
COUNSELOR OWNED/1/ IN BILLIONS)/2/ IN BILLIONS)/3/ IN BILLIONS)/4/
-----------------------------------------------------------------------------------------------

Robert W. $500,001 -- 3 $168.7 1 $0.24 None
Lovelace $1,000,000
-----------------------------------------------------------------------------------------------
Mark E. Denning $100,001 -- 6 $238.3 2 $0.05 None
$500,000
-----------------------------------------------------------------------------------------------
David C. Barclay Over 4 $157.8 5 $1.15 13 $2.91
$1,000,000
-----------------------------------------------------------------------------------------------
Alwyn Heong $100,001 -- 2 $127.2 None None
$500,000
-----------------------------------------------------------------------------------------------
Carl M. Kawaja $500,001 -- 4 $216.9 1 $0.24 None
$1,000,000
-----------------------------------------------------------------------------------------------

1 Ownership disclosure is made using the following ranges: None; $1 - $10,000;
$10,001 - $50,000; $50,001 - $100,000; $100,001 - $500,000; $500,001 -
$1,000,000; and Over $1,000,000. The amounts listed include shares owned
through The Capital Group Companies, Inc. retirement plan and 401(k) plan.
2 Indicates fund(s) where the portfolio counselor also has significant
responsibilities for the day to day management of the fund(s). Assets noted are
the total net assets of the registered investment companies and are not
indicative of the total assets managed by the individual, which is a
substantially lower amount.
3 Represents funds advised or sub-advised by Capital Research and Management
Company and sold outside the United States. Assets noted are the total net
assets of the fund and are not indicative of the total assets managed by the
individual, which is a substantially lower amount.
4 Reflects other professionally managed accounts held at companies affiliated
with Capital Research and Management Company. Personal brokerage accounts of
portfolio counselors and their families are not reflected.

INVESTMENT ADVISORY AND SERVICE AGREEMENT -- The Investment Advisory and Service
Agreement (the "Agreement") between the fund and the investment adviser will
continue in effect until December 31, 2006, unless sooner terminated, and may be
renewed from year to year thereafter, provided that any such renewal has been
specifically approved at least annually by (a) the Board of Directors, or by the
vote of a majority (as defined in the 1940 Act) of the outstanding voting
securities of the fund, and (b) the vote of a majority of Directors who are not
parties to the Agreement or interested persons (as defined in the 1940 Act) of
any such party, cast in person at a meeting called for the purpose of voting on
such approval. The Agreement provides that the investment adviser has no
liability to the fund for its acts or omissions in the performance of its
obligations to the fund not involving willful misconduct, bad faith, gross
negligence or reckless disregard of its obligations under the Agreement. The
Agreement also provides that either party has the right to terminate it, without
penalty, upon 60 days' written notice to the other party, and that the Agreement
automatically terminates in the event of its assignment (as defined in the 1940
Act).

New World Fund -- Page 23
<PAGE>

In addition to providing investment advisory services, the investment adviser
furnishes the services and pays the compensation and travel expenses of persons
to perform the fund's executive, administrative, clerical and bookkeeping
functions, and provides suitable office space, necessary small office equipment
and utilities, general purpose accounting forms, supplies and postage used at
the fund's offices. The fund pays all expenses not assumed by the investment
adviser, including, but not limited to, custodian, stock transfer and dividend
disbursing fees and expenses; shareholder recordkeeping and administrative
expenses; costs of the designing, printing and mailing of reports, prospectuses,
proxy statements and notices to its shareholders; taxes; expenses of the
issuance and redemption of fund shares (including stock certificates,
registration and qualification fees and expenses); expenses pursuant to the
fund's plans of distribution (described below); legal and auditing expenses;
compensation, fees and expenses paid to Non-Interested Directors; association
dues; costs of stationery and forms prepared exclusively for the fund; and costs
of assembling and storing shareholder account data.

As compensation for its services, the investment adviser receives a monthly fee
that is accrued daily, calculated at the annual rate of 0.85% on the first $500
million of the Fund's net assets, 0.77% on net assets between $500 million and
$1 billion, 0.71% on net assets from $1 billion to $1.5 billion, 0.66% on net
assets from $1.5 billion to $2.5 billion, 0.62% on net assets from $2.5 billion
to $4 billion, 0.58% on net assets from $4 billion to $6.5 billion, and 0.54% on
net assets in excess of $6.5 billion.

The investment adviser has agreed that in the event the Class A expenses of the
fund (with the exclusion of interest, taxes, brokerage costs, distribution
expenses pursuant to a plan under rule 12b-1 and extraordinary expenses such as
litigation and acquisitions or other expenses excludable under applicable state
securities laws or regulations) for any fiscal year ending on a date on which
the Agreement is in effect, exceed the expense limitations, if any, applicable
to the fund pursuant to state securities laws or any related regulations, it
will reduce its fee by the extent of such excess and, if required pursuant to
any such laws or any regulations thereunder, will reimburse the fund in the
amount of such excess. To the extent the fund's management fee must be waived
due to Class A share expense ratios exceeding the above limit, management fees
will be reduced similarly for all classes of shares of the fund, or other Class
A fees will be waived in lieu of management fees.

For the fiscal years ended October 31, 2005 and 2004, the investment adviser was
entitled to receive from the fund management fees of $27,569,000 and
$16,931,000, respectively. After giving effect to the management fee waiver
described below, the fund paid the investment adviser management fees of
$25,295,000 (a reduction of $2,274,000) and $16,772,000 (a reduction of
$159,000) for the fiscal years ended October 31, 2005 and 2004, respectively.
For the fiscal year ended October 31, 2003, the fund paid the investment adviser
management fees of $10,601,000.

For the period from September 1, 2004 through March 31, 2005, the investment
adviser agreed to waive 5% of the management fees that it was otherwise entitled
to receive under the Agreement. Beginning April 1, 2005, this waiver increased
to 10% of the management fees that the investment adviser is otherwise entitled
to receive and is expected to continue at this level until further review. As a
result of this waiver, management fees will be reduced similarly for all classes
of shares of the fund.

ADMINISTRATIVE SERVICES AGREEMENT -- The Administrative Services Agreement (the
"Administrative Agreement") between the fund and the investment adviser relating
to the fund's Class C, F, R and 529 shares will continue in effect until
December 31, 2006, unless sooner

New World Fund -- Page 24
<PAGE>

terminated, and may be renewed from year to year thereafter, provided that any
such renewal has been specifically approved at least annually by the vote of a
majority of Directors who are not parties to the Administrative Agreement or
interested persons (as defined in the 1940 Act) of any such party, cast in
person at a meeting called for the purpose of voting on such approval. The fund
may terminate the Administrative Agreement at any time by vote of a majority of
Non-Interested Directors. The investment adviser has the right to terminate the
Administrative Agreement upon 60 days' written notice to the fund. The
Administrative Agreement automatically terminates in the event of its assignment
(as defined in the 1940 Act).

Under the Administrative Agreement, the investment adviser provides certain
transfer agent and administrative services for shareholders of the fund's Class
C and F shares, and all Class R and 529 shares. The investment adviser contracts
with third parties, including American Funds Service Company, the fund's
Transfer Agent, to provide these services. Services include, but are not limited
to, shareholder account maintenance, transaction processing, tax information
reporting and shareholder and fund communications. In addition, the investment
adviser monitors, coordinates and oversees the activities performed by third
parties providing such services. For Class R-1, R-2 and R-3 shares, the
investment adviser has agreed to pay a portion of the fees payable under the
Administrative Agreement that would otherwise have been paid by the fund. For
the year ended October 31, 2005, the total fees paid by the investment adviser
were $110,000.

As compensation for its services, the investment adviser receives transfer agent
fees for transfer agent services provided to the fund's Class C, F, R and 529
shares. Transfer agent fees are paid monthly according to a fee schedule
contained in a Shareholder Services Agreement between the fund and American
Funds Service Company. The investment adviser also receives an administrative
services fee at the annual rate of up to 0.15% of the average daily net assets
for each applicable share class (excluding Class R-5 shares) for administrative
services provided to these share classes. Administrative services fees are paid
monthly and accrued daily. The investment adviser uses a portion of this fee to
compensate third parties for administrative services provided to the fund. Of
the remainder, the investment adviser will not retain more than 0.05% of the
average daily net assets for each applicable share class. For Class R-5 shares,
the administrative services fee is calculated at the annual rate of up to 0.10%
of the average daily net assets. This fee is subject to the same uses and
limitations described above.

During the 2005 fiscal year, administrative services fees, gross of any payments
made by the investment adviser, were:

ADMINISTRATIVE SERVICES FEE
--------------------------------------------------------------------------------

CLASS C $308,000
--------------------------------------------------------------------------------
CLASS F 378,000
--------------------------------------------------------------------------------
CLASS 529-A 77,000
--------------------------------------------------------------------------------
CLASS 529-B 16,000
--------------------------------------------------------------------------------
CLASS 529-C 25,000
--------------------------------------------------------------------------------
CLASS 529-E 5,000
--------------------------------------------------------------------------------
CLASS 529-F 5,000
--------------------------------------------------------------------------------
CLASS R-1 6,000
--------------------------------------------------------------------------------
CLASS R-2 232,000
--------------------------------------------------------------------------------
CLASS R-3 94,000
--------------------------------------------------------------------------------
CLASS R-4 14,000
--------------------------------------------------------------------------------
CLASS R-5 142,000
--------------------------------------------------------------------------------

New World Fund -- Page 25
<PAGE>

PRINCIPAL UNDERWRITER AND PLANS OF DISTRIBUTION -- American Funds Distributors,
Inc. (the "Principal Underwriter") is the principal underwriter of the fund's
shares. The Principal Underwriter is located at 333 South Hope Street, Los
Angeles, CA 90071; 135 South State College Boulevard, Brea, CA 92821; 3500
Wiseman Boulevard, San Antonio, TX 78251; 8332 Woodfield Crossing Boulevard,
Indianapolis, IN 46240; and 5300 Robin Hood Road, Norfolk, VA 23513.

The Principal Underwriter receives revenues from sales of the fund's shares. For
Class A and 529-A shares, the Principal Underwriter receives commission revenue
consisting of that portion of the Class A and 529-A sales charge remaining after
the allowances by the Principal Underwriter to investment dealers. For Class B
and 529-B shares, the Principal Underwriter sells the rights to the 12b-1 fees
paid by the fund for distribution expenses to a third party and receives the
revenue remaining after compensating investment dealers for sales of Class B and
529-B shares. The fund also pays the Principal Underwriter for advancing the
immediate service fees paid to qualified dealers of Class B and 529-B shares.
For Class C and 529-C shares, the Principal Underwriter receives any contingent
deferred sales charges that apply during the first year after purchase. The fund
pays the Principal Underwriter for advancing the immediate service fees and
commissions paid to qualified dealers of Class C and 529-C shares. For Class
529-E shares, the fund pays the Principal Underwriter for advancing the
immediate service fees and commissions paid to qualified dealers. For Class F
and 529-F shares, the fund pays the Principal Underwriter for advancing the
immediate service fees paid to qualified dealers and advisers who sell Class F
and 529-F shares. For Class R-1, R-2, R-3 and R-4 shares, the fund pays the
Principal Underwriter for advancing the immediate service fees paid to qualified
dealers and advisers who sell Class R-1, R-2, R-3 and R-4 shares.

New World Fund -- Page 26
<PAGE>

Commissions, revenue or service fees retained by the Principal Underwriter after
allowances or compensation to dealers were:

COMMISSIONS, ALLOWANCE OR
REVENUE COMPENSATION
FISCAL YEAR/PERIOD OR FEES RETAINED TO DEALERS
-----------------------------------------------------------------------------------------------------

CLASS A 2005 $4,253,000 $18,745,000
2004 1,585,000 6,908,000
2003 483,000 2,331,000
CLASS B 2005 182,000 1,484,000
2004 123,000 988,000
2003 65,000 413,000
-----------------------------------------------------------------------------------------------------
CLASS C 2005 0 1,078,000
2004 0 458,000
2003 0 195,000
-----------------------------------------------------------------------------------------------------
CLASS 529-A 2005 167,000 764,000
2004 75,000 341,000
2003 28,000 134,000
-----------------------------------------------------------------------------------------------------
CLASS 529-B 2005 17,000 99,000
2004 14,000 82,000
2003 9,000 54,000
-----------------------------------------------------------------------------------------------------
CLASS 529-C 2005 0 77,000
2004 0 35,000
2003 0 17,000
-----------------------------------------------------------------------------------------------------

The fund has adopted plans of distribution (the "Plans") pursuant to rule 12b-1
under the 1940 Act. The Principal Underwriter receives amounts payable pursuant
to the Plans (see below). As required by rule 12b-1 and the 1940 Act, the Plans
(together with the Principal Underwriting Agreement) have been approved by the
full Board of Directors and separately by a majority of the Directors who are
not "interested persons" of the fund and who have no direct or indirect
financial interest in the operation of the Plans or the Principal Underwriting
Agreement. Potential benefits of the Plans to the fund include quality
shareholder services; savings to the fund in transfer

New World Fund -- Page 27
<PAGE>

agency costs; and benefits to the investment process from growth or stability of
assets. The selection and nomination of Directors who are not "interested
persons" of the fund are committed to the discretion of the Directors who are
not "interested persons" during the existence of the Plans. The Plans may not be
amended to increase materially the amount spent for distribution without
shareholder approval. Plan expenses are reviewed quarterly and the Plans must be
renewed annually by the Board of Directors.

Under the Plans, the fund may annually expend the following amounts to finance
any activity primarily intended to result in the sale of fund shares, provided
the fund's Board of Directors has approved the category of expenses for which
payment is being made: (a) for Class A shares, up to 0.30% of the average daily
net assets attributable to Class A shares; (b) for Class 529-A shares, up to
0.50% of the average daily net assets attributable to Class 529-A shares; (c)
for Class B and 529-B shares, up to 1.00% of the average daily net assets
attributable to Class B and 529-B shares, respectively; (d) for Class C and
529-C shares, up to 1.00% of the average daily net assets attributable to Class
C and 529-C shares, respectively; (e) for Class 529-E shares, up to 0.75% of the
average daily net assets attributable to Class 529-E shares; (f) for Class F and
529-F shares, up to 0.50% of the average daily net assets attributable to Class
F and 529-F shares; (g) for Class R-1 shares, up to 1.00% of the average daily
net assets attributable to Class R-1 shares; (h) for Class R-2 shares, up to
1.00% of the average daily net assets attributable to Class R-2 shares; (i) for
Class R-3 shares, up to 0.75% of the average daily net assets attributable to
Class R-3 shares; and (j) for Class R-4 shares, up to 0.50% of the average daily
net assets attributable to Class R-4 shares. The fund has not adopted a Plan for
Class R-5 shares; accordingly, no 12b-1 fees are paid from Class R-5 share
assets.

For Class A and 529-A shares: (a) up to 0.25% is reimbursed to the Principal
Underwriter for paying service-related expenses, including paying service fees
to qualified dealers, and (b) up to the amount allowable under the fund's Class
A and 529-A 12b-1 limit is reimbursed to the Principal Underwriter for paying
distribution-related expenses, including for Class A and 529-A shares dealer
commissions and wholesaler compensation paid on sales of shares of $1 million or
more purchased without a sales charge (including purchases by employer-sponsored
defined contribution-type retirement plans investing $1 million or more or with
100 or more eligible employees, and retirement plans, endowments and foundations
with $50 million or more in assets -- "no load purchases"). Commissions on no
load purchases of Class A and 529-A shares, in excess of the Class A and 529-A
plan limitations not reimbursed to the Principal Underwriter during the most
recent fiscal quarter are recoverable for five quarters, provided that such
commissions do not exceed the annual expense limit. After five quarters, these
commissions are not recoverable.

For Class B and 529-B shares: (a) up to 0.25% is paid to the Principal
Underwriter for paying service-related expenses, including paying service fees
to qualified dealers, and (b) 0.75% is paid to the Principal Underwriter for
distribution-related expenses, including the financing of commissions paid to
qualified dealers.

For Class C and 529-C shares: (a) up to 0.25% is paid to the Principal
Underwriter for paying service-related expenses, including paying service fees
to qualified dealers, and (b) up to 0.75% is paid to the Principal Underwriter
for paying distribution-related expenses, including commissions paid to
qualified dealers.

For Class 529-E shares: currently (a) up to 0.25% is paid to the Principal
Underwriter for paying service-related expenses, including paying service fees
to qualified dealers, and (b) up to 0.25%

New World Fund -- Page 28
<PAGE>

is paid to the Principal Underwriter for paying distribution-related expenses,
including commissions paid to qualified dealers.

For Class F and 529-F shares: currently up to 0.25% is paid to the Principal
Underwriter for paying service-related expenses, including paying service fees
to qualified dealers or advisers.

For Class R-1 shares: (a) up to 0.25% is paid to the Principal Underwriter for
paying service-related expenses, including paying service fees to qualified
dealers, and (b) up to 0.75% is paid to the Principal Underwriter for
distribution-related expenses, including commissions paid to qualified dealers.

For Class R-2 shares: currently (a) up to 0.25% is paid to the Principal
Underwriter for paying service-related expenses, including paying service fees
to qualified dealers, and (b) up to 0.50% is paid to the Principal Underwriter
for paying distribution-related expenses, including commissions paid to
qualified dealers.

For Class R-3 shares: currently (a) up to 0.25% is paid to the Principal
Underwriter for paying service-related expenses, including paying service fees
to qualified dealers, and (b) up to 0.25% is paid to the Principal Underwriter
for paying distribution-related expenses, including commissions paid to
qualified dealers.

For Class R-4 shares: currently up to 0.25% is paid to the Principal Underwriter
for paying service-related expenses, including paying service fees to qualified
dealers or advisers.

As of the end of the 2005 fiscal year, total 12b-1 expenses, and the portion of
the expense that remained unpaid, were:

12B-1 UNPAID LIABILITY
12B-1 EXPENSES OUTSTANDING
-----------------------------------------------------------------------------------------------

CLASS A $8,243,000 $1,059,000
-----------------------------------------------------------------------------------------------
CLASS B 1,288,000 165,000
-----------------------------------------------------------------------------------------------
CLASS C 1,691,000 305,000
-----------------------------------------------------------------------------------------------
CLASS F 622,000 131,000
-----------------------------------------------------------------------------------------------
CLASS 529-A 87,000 15,000
-----------------------------------------------------------------------------------------------
CLASS 529-B 82,000 11,000
-----------------------------------------------------------------------------------------------
CLASS 529-C 138,000 25,000
-----------------------------------------------------------------------------------------------
CLASS 529-E 14,000 3,000
-----------------------------------------------------------------------------------------------
CLASS 529-F 4,000 0
-----------------------------------------------------------------------------------------------
CLASS R-1 24,000 5,000
-----------------------------------------------------------------------------------------------
CLASS R-2 236,000 56,000
-----------------------------------------------------------------------------------------------
CLASS R-3 152,000 34,000
-----------------------------------------------------------------------------------------------
CLASS R-4 20,000 5,000
-----------------------------------------------------------------------------------------------

New World Fund -- Page 29
<PAGE>

OTHER COMPENSATION TO DEALERS -- As of January 2005, the top dealers that
American Funds Distributors anticipates will receive additional compensation (as
described in the prospectus) include:

1717 Capital Management Company
A. G. Edwards & Sons, Inc.
AIG Advisors Group
American General Securities Inc.
Ameritas Investment Corp.
AXA Advisors, LLC
Cadaret, Grant & Co., Inc.
Cambridge Investment Research, Inc.
Capital Analysts, Inc.
Commonwealth Financial Network
Cuna Brokerage Services, Inc.
Deutsche Bank Securities Inc.
Edward Jones
Ferris, Baker Watts, Inc.
Hefren-Tillotson, Inc.
Hornor, Townsend & Kent, Inc.
ING Advisors Network Inc.
InterSecurities, Inc./Transamerica Financial Advisors, Inc.
Investacorp, Inc.
Janney Montgomery Scott LLC
Jefferson Pilot Securities Corporation
JJB Hilliard, WL Lyons, Inc./PNC Bank
Legg Mason Wood Walker, Inc.
Lincoln Financial Advisors Corporation
Linsco/Private Ledger Corp.
McDonald Investments Inc./Society National Bank
Merrill Lynch, Pierce, Fenner & Smith Inc.
Metlife Enterprises
MML Investors Services, Inc.
Morgan Keegan & Company, Inc.
NatCity Investment, Inc.
National Planning Holdings Inc.
NFP Securities, Inc.
Northwestern Mutual Investment Services, LLC.
Pacific Select Distributors Inc.
Park Avenue Securities LLC
Piper Jaffray & Co.
Princor Financial Services/PPI Employee Benefits
ProEquities, Inc.
Raymond James Financial Services/Raymond James & Associates
RBC Dain Rauscher Inc.
Robert W. Baird & Co. Inc.
Securian Financial Services/C.R.I. Securities Inc.
Securities Service Network Inc.
Signator Investors, Inc.
Smith Barney

New World Fund -- Page 30
<PAGE>

Stifel, Nicolaus & Company, Inc.
Terra Securities Corporation
The O.N. Equity Sales Company
UBS Financial Services Inc.
US Bancorp Investments, Inc.
Wachovia Securities
WS Griffith Securities, Inc.

EXECUTION OF PORTFOLIO TRANSACTIONS

As described in the prospectus, the investment adviser places orders with
broker-dealers for the fund's portfolio transactions. Portfolio transactions for
the fund may be executed as part of concurrent authorizations to purchase or
sell the same security for other funds served by the investment adviser, or for
trusts or other accounts served by affiliated companies of the investment
adviser. When such concurrent authorizations occur, the objective is to allocate
the executions in an equitable manner.

Brokerage commissions paid on portfolio transactions, including investment
dealer concessions on underwritings, if applicable, for the fiscal years ended
October 31, 2005, 2004 and 2003 amounted to $7,997,000, $4,219,000 and
$2,431,000, respectively. With respect to fixed-income securities, brokerage
commissions include explicit investment dealer concessions and may exclude other
transaction costs which may be reflected in the spread between the bid and asked
price. The volume of trading activity increased during 2005 as compared to 2003
and 2004, resulting in an increase in brokerage commissions/concessions paid on
portfolio transactions.

The fund is required to disclose information regarding investments in the
securities of its "regular" broker-dealers (or parent companies of its regular
broker-dealers) that derive more than 15% of their revenue from broker-dealer,
underwriter or investment adviser activities. A regular broker-dealer is (a) one
of the 10 broker-dealers that received from the fund the largest amount of
brokerage commissions by participating, directly or indirectly, in the fund's
portfolio transactions during the fund's most recent fiscal year; (b) one of the
10 broker-dealers that engaged as principal in the largest dollar amount of
portfolio transactions of the fund during the fund's most recent fiscal year; or
(c) one of the 10 broker-dealers that sold the largest amount of securities of
the fund during the fund's most recent fiscal year.

At the end of the fund's most recent fiscal year, the fund's regular
broker-dealers included Citigroup Global Markets, Inc. As of the fund's most
recent fiscal year-end, the fund held equity securities of Citigroup, Inc. in
the amount of $8,012,000.

DISCLOSURE OF PORTFOLIO HOLDINGS

The fund's investment adviser, on behalf of the fund, has adopted policies and
procedures with respect to the disclosure of information about fund portfolio
securities. These policies and procedures have been reviewed by the fund's Board
of Directors and compliance will be periodically assessed by the Board in
connection with reporting from the fund's Chief Compliance Officer.

Under these policies and procedures, the fund's complete list of portfolio
holdings required for public disclosure, dated as of the end of each calendar
quarter, is permitted to be posted on the American Funds website no earlier than
the tenth day after such calendar quarter. In practice, the

New World Fund -- Page 31
<PAGE>

public portfolio typically is posted on the website approximately 45 days after
the end of the calendar quarter. In addition, the fund's list of top 10 equity
portfolio holdings measured by percentage of net assets invested, dated as of
the end of each calendar month, is permitted to be posted on the American Funds
website no earlier than the tenth day after such month. Such portfolio holdings
information may then be disclosed to any person pursuant to an ongoing
arrangement to disclose portfolio holdings information to such person no earlier
than one day after the day on which the information is posted on the American
Funds website. Affiliates of the fund (including the fund's Board members and
officers, and certain personnel of the fund's investment adviser and its
affiliates) and certain service providers (such as the fund's custodian and
outside counsel) who require portfolio holdings information for legitimate
business and fund oversight purposes may receive the information earlier.

Affiliated persons of the fund as described above who receive portfolio holdings
information are subject to restrictions and limitations on the use and handling
of such information pursuant to applicable codes of ethics, including
requirements to maintain the confidentiality of such information, preclear
securities trades and report securities transactions activity, as applicable.
Third party service providers of the fund receiving such information are subject
to confidentiality obligations. When portfolio holdings information is disclosed
other than through the American Funds website to persons not affiliated with the
fund (which, as described above, would typically occur no earlier than one day
after the day on which the information is posted on the American Funds website),
such persons may be bound by agreements (including confidentiality agreements)
that restrict and limit their use of the information to legitimate business uses
only. Neither the fund nor its investment adviser or any affiliate thereof
receives compensation or other consideration in connection with the disclosure
of information about portfolio securities.

Subject to Board policies, the authority to disclose a fund's portfolio
holdings, and to establish policies with respect to such disclosure, resides
with the Investment Committee of the fund's investment adviser. In exercising
its authority, the Investment Committee determines whether disclosure of
information about the fund's portfolio securities is appropriate and in the best
interest of fund shareholders. The investment adviser has implemented policies
and procedures to address conflicts of interest that may arise from the
disclosure of fund holdings. For example, the investment adviser's code of
ethics specifically requires, among other things, the safeguarding of
information about fund holdings and contains prohibitions designed to prevent
the personal use of confidential, proprietary investment information in a way
that would conflict with fund transactions. In addition, the investment adviser
believes that its current policy of not selling portfolio holdings information
and not disclosing such information to unaffiliated third parties until such
holdings have been made public on the American Funds website (other than to
certain fund service providers for legitimate business and fund oversight
purposes) helps reduce potential conflicts of interest between fund shareholders
and the investment adviser and its affiliates.

PRICE OF SHARES

Shares are purchased at the offering price or sold at the net asset value price
next determined after the purchase or sell order is received and accepted by the
fund or the Transfer Agent; the offering or net asset value price is effective
for orders received prior to the time of determination of the net asset value
and, in the case of orders placed with dealers or their authorized designees,
accepted by the Principal Underwriter, the Transfer Agent, a dealer or any of
their designees. In the case of orders sent directly to the fund or the Transfer
Agent, an investment

New World Fund -- Page 32
<PAGE>

dealer MUST be indicated. The dealer is responsible for promptly transmitting
purchase and sell orders to the Principal Underwriter.

Orders received by the investment dealer or authorized designee, the Transfer
Agent or the fund after the time of the determination of the net asset value
will be entered at the next calculated offering price. Note that investment
dealers or other intermediaries may have their own rules about share
transactions and may have earlier cut-off times than those of the fund. For more
information about how to purchase through your intermediary, contact your
intermediary directly.

Prices that appear in the newspaper do not always indicate prices at which you
will be purchasing and redeeming shares of the fund, since such prices generally
reflect the previous day's closing price, while purchases and redemptions are
made at the next calculated price. The price you pay for shares, the offering
price, is based on the net asset value per share, which is calculated once daily
as of approximately 4:00 p.m. New York time, which is the normal close of
trading on the New York Stock Exchange, each day the Exchange is open. If, for
example, the Exchange closes at 1:00 p.m., the fund's share price would still be
determined as of 4:00 p.m. New York time. The New York Stock Exchange is
currently closed on weekends and on the following holidays: New Year's Day;
Martin Luther King, Jr. Day; Presidents' Day; Good Friday; Memorial Day;
Independence Day; Labor Day; Thanksgiving; and Christmas Day. Each share class
of the fund has a separately calculated net asset value (and share price).

All portfolio securities of funds managed by Capital Research and Management
Company (other than money market funds) are valued, and the net asset values per
share for each share class are determined, as follows:

1. Equity securities, including depositary receipts, are valued at the
official closing price of, or the last reported sale price on, the exchange or
market on which such securities are traded, as of the close of business on the
day the securities are being valued or, lacking any sales, at the last available
bid price. Prices for each security are taken from the principal exchange or
market in which the security trades. Fixed-income securities are valued at
prices obtained from an independent pricing service, when such prices are
available; however, in circumstances where the investment adviser deems it
appropriate to do so, such securities will be valued at the mean quoted bid and
asked prices (or bid prices, if asked prices are not available) or at prices for
securities of comparable maturity, quality and type.

Securities with both fixed-income and equity characteristics (e.g., convertible
bonds, preferred stocks, units comprised of more than one type of security,
etc.), or equity securities traded principally among fixed-income dealers, are
valued in the manner described above for either equity or fixed-income
securities, depending on which method is deemed most appropriate by the
investment adviser.

Securities with original maturities of one year or less having 60 days or less
to maturity are amortized to maturity based on their cost if acquired within 60
days of maturity, or if already held on the 60th day, based on the value
determined on the 61st day. Forward currency contracts are valued at the mean of
representative quoted bid and asked prices.

Assets or liabilities initially expressed in terms of non-U.S. currencies are
translated prior to the next determination of the net asset value of the fund's
shares into U.S. dollars at the prevailing market rates.

New World Fund -- Page 33
<PAGE>

Securities and assets for which market quotations are not readily available or
are considered unreliable are valued at fair value as determined in good faith
under policies approved by the fund's Board. Subject to Board oversight, the
fund's Board has delegated the obligation to make fair valuation determinations
to a Valuation Committee established by the fund's investment adviser. The Board
receives regular reports describing fair-valued securities and the valuation
methods used.

The Valuation Committee has adopted guidelines and procedures (consistent with
SEC rules and guidance) to ensure that certain basic principles and factors are
considered when making all fair value determinations. As a general principle,
securities lacking readily available market quotations, or that have quotations
that are considered unreliable, are valued in good faith by the Valuation
Committee based upon what the fund might reasonably expect to receive upon their
current sale. The Valuation Committee considers all indications of value
available to it in determining the fair value to be assigned to a particular
security, including, without limitation, the type and cost of the security,
contractual or legal restrictions on resale of the security, relevant financial
or business developments of the issuer, actively traded similar or related
securities, conversion or exchange rights on the security, related corporate
actions, significant events occurring after the close of trading in the security
and changes in overall market conditions. The Valuation Committee employs
additional fair value procedures to address issues related to investing
substantial portions of applicable fund portfolios outside the United States.
Securities owned by these funds trade in markets that open and close at
different times, reflecting time zone differences. If significant events occur
after the close of a market (and before these fund's net asset values are next
determined) which affect the value of portfolio securities, appropriate
adjustments from closing market prices may be made to reflect these events.
Events of this type could include, for example, earthquakes and other natural
disasters or significant price changes in other markets (e.g., U.S. stock
markets);

2. Each class of shares represents interests in the same portfolio of
investments and is identical in all respects to each other class, except for
differences relating to distribution, service and other charges and expenses,
certain voting rights, differences relating to eligible investors, the
designation of each class of shares, conversion features and exchange
privileges. Expenses attributable to the fund, but not to a particular class of
shares, are borne by each class pro rata based on relative aggregate net assets
of the classes. Expenses directly attributable to a class of shares are borne by
that class of shares. Liabilities, including accruals of taxes and other expense
items attributable to particular share classes, are deducted from total assets
attributable to such share classes.

3. Net assets so obtained for each share class are then divided by the total
number of shares outstanding of that share class, and the result, rounded to the
nearer cent, is the net asset value per share for that share class.

TAXES AND DISTRIBUTIONS

FUND TAXATION -- The fund has elected to be treated as a regulated investment
company under Subchapter M of the Internal Revenue Code (the "Code"). A
regulated investment company qualifying under Subchapter M of the Code is
required to distribute to its shareholders at least 90% of its investment
company taxable income (including the excess of net short-term capital gain over
net long-term capital losses) and generally is not subject to federal income tax
to the extent that it distributes annually 100% of its investment company
taxable income and net realized capital gains in the manner required under the
Code. The fund intends to distribute

New World Fund -- Page 34
<PAGE>

annually all of its investment company taxable income and net realized capital
gains and therefore does not expect to pay federal income tax, although in
certain circumstances, the fund may determine that it is in the interest of
shareholders to distribute less than that amount.

To be treated as a regulated investment company under Subchapter M of the Code,
the fund must also (a) derive at least 90% of its gross income from dividends,
interest, payments with respect to securities loans, net income from certain
publicly traded partnerships and gains from the sale or other disposition of
securities or foreign currencies, or other income (including, but not limited
to, gains from options, futures or forward contracts) derived with respect to
the business of investing in such securities or currencies, and (b) diversify
its holdings so that, at the end of each fiscal quarter, (i) at least 50% of the
market value of the fund's assets is represented by cash, U.S. government
securities and securities of other regulated investment companies, and other
securities (for purposes of this calculation, generally limited in respect of
any one issuer, to an amount not greater than 5% of the market value of the
fund's assets and 10% of the outstanding voting securities of such issuer) and
(ii) not more than 25% of the value of its assets is invested in the securities
of (other than U.S. government securities or the securities of other regulated
investment companies) any one issuer; two or more issuers which the fund
controls and which are determined to be engaged in the same or similar trades or
businesses; or the securities of certain publicly traded partnerships.

Under the Code, a nondeductible excise tax of 4% is imposed on the excess of a
regulated investment company's "required distribution" for the calendar year
ending within the regulated investment company's taxable year over the
"distributed amount" for such calendar year. The term "required distribution"
means the sum of (a) 98% of ordinary income (generally net investment income)
for the calendar year, (b) 98% of capital gain (both long-term and short-term)
for the one-year period ending on October 31 (as though the one-year period
ending on October 31 were the regulated investment company's taxable year) and
(c) the sum of any untaxed, undistributed net investment income and net capital
gains of the regulated investment company for prior periods. The term
"distributed amount" generally means the sum of (a) amounts actually distributed
by the fund from its current year's ordinary income and capital gain net income
and (b) any amount on which the fund pays income tax during the periods
described above. Although the fund intends to distribute its net investment
income and net capital gains so as to avoid excise tax liability, the fund may
determine that it is in the interest of shareholders to distribute a lesser
amount.

The following information may not apply to you if you hold fund shares in a
tax-deferred account, such as a retirement plan or education savings account.
Please see your tax adviser for more information.

DIVIDENDS AND CAPITAL GAIN DISTRIBUTIONS -- Dividends and capital gain
distributions on fund shares will be reinvested in shares of the fund of the
same class, unless shareholders indicate in writing that they wish to receive
them in cash or in shares of the same class of other American Funds, as provided
in the prospectus. Dividends and capital gain distributions by 529 share classes
will be automatically reinvested.

Distributions of investment company taxable income and net realized capital
gains to individual shareholders will be taxable whether received in shares or
in cash, unless such shareholders are exempt from taxation. Shareholders
electing to receive distributions in the form of additional shares will have a
cost basis for federal income tax purposes in each share so received equal to

New World Fund -- Page 35
<PAGE>

the net asset value of that share on the reinvestment date. Dividends and
capital gain distributions by the fund to a tax-deferred retirement plan account
are not taxable currently.

DIVIDENDS -- The fund intends to follow the practice of distributing
substantially all of its investment company taxable income, which includes
any excess of net realized short-term gains over net realized long-term
capital losses. Investment company taxable income generally includes
dividends, interest, net short-term capital gains in excess of net
long-term capital losses, and certain foreign currency gains, if any, less
expenses and certain foreign currency losses. To the extent the fund
invests in stock of domestic and certain foreign corporations and meets the
applicable holding period requirement, it may receive "qualified
dividends". The fund will designate the amount of "qualified dividends" to
its shareholders in a notice sent within 60 days of the close of its fiscal
year and will report "qualified dividends" to shareholders on Form
1099-DIV.

Under the Code, gains or losses attributable to fluctuations in exchange
rates that occur between the time the fund accrues receivables or
liabilities denominated in a foreign currency and the time the fund
actually collects such receivables, or pays such liabilities, generally are
treated as ordinary income or ordinary loss. Similarly, on disposition of
debt securities denominated in a foreign currency and on disposition of
certain futures contracts, forward contracts and options, gains or losses
attributable to fluctuations in the value of foreign currency between the
date of acquisition of the security or contract and the date of disposition
are also treated as ordinary gain or loss. These gains or losses, referred
to under the Code as Section 988 gains or losses, may increase or decrease
the amount of the fund's investment company taxable income to be
distributed to its shareholders as ordinary income.

If the fund invests in stock of certain passive foreign investment
companies, the fund may be subject to U.S. federal income taxation on a
portion of any "excess distribution" with respect to, or gain from the
disposition of, such stock. The tax would be determined by allocating such
distribution or gain ratably to each day of the fund's holding period for
the stock. The distribution or gain so allocated to any taxable year of the
fund, other than the taxable year of the excess distribution or
disposition, would be taxed to the fund at the highest ordinary income rate
in effect for such year, and the tax would be further increased by an
interest charge to reflect the value of the tax deferral deemed to have
resulted from the ownership of the foreign company's stock. Any amount of
distribution or gain allocated to the taxable year of the distribution or
disposition would be included in the fund's investment company taxable
income and, accordingly, would not be taxable to the fund to the extent
distributed by the fund as a dividend to its shareholders.

To avoid such tax and interest, the fund intends to elect to treat these
securities as sold on the last day of its fiscal year and recognize any
gains for tax purposes at that time. Under this election, deductions for
losses are allowable only to the extent of any prior recognized gains, and
both gains and losses will be treated as ordinary income or loss. The fund
will be required to distribute any resulting income, even though it has not
sold the security and received cash to pay such distributions. Upon
disposition of these securities, any gain recognized is treated as ordinary
income and loss is treated as ordinary loss to the extent of any prior
recognized gain.

Dividends from domestic corporations are expected to comprise some portion
of the fund's gross income. To the extent that such dividends constitute
any of the fund's gross

New World Fund -- Page 36
<PAGE>

income, a portion of the income distributions of the fund may be eligible
for the deduction for dividends received by corporations. Corporate
shareholders will be informed of the portion of dividends that so
qualifies. The dividends-received deduction is reduced to the extent that
either the fund shares, or the underlying shares of stock held by the fund,
with respect to which dividends are received, are treated as debt-financed
under federal income tax law, and is eliminated if the shares are deemed to
have been held by the shareholder or the fund, as the case may be, for less
than 46 days during the 90-day period beginning on the date that is 45 days
before the date on which the shares become ex-dividend. Capital gain
distributions are not eligible for the dividends-received deduction.

A portion of the difference between the issue price of zero coupon
securities and their face value (original issue discount) is considered to
be income to the fund each year, even though the fund will not receive cash
interest payments from these securities. This original issue discount
(imputed income) will comprise a part of the investment company taxable
income of the fund that must be distributed to shareholders in order to
maintain the qualification of the fund as a regulated investment company
and to avoid federal income taxation at the level of the fund.

In addition, some of the bonds may be purchased by the fund at a discount
that exceeds the original issue discount on such bonds, if any. This
additional discount represents market discount for federal income tax
purposes. The gain realized on the disposition of any bond having a market
discount may be treated as taxable ordinary income to the extent it does
not exceed the accrued market discount on such bond or a fund may elect to
include the market discount in income in tax years to which it is
attributable. Generally, accrued market discount may be figured under
either the ratable accrual method or constant interest method. If the fund
has paid a premium over the face amount of a bond, the fund has the option
of either amortizing the premium until bond maturity and reducing the
fund's basis in the bond by the amortized amount, or not amortizing and
treating the premium as part of the bond's basis. In the case of any debt
security having a fixed maturity date of not more than one year from its
date of issue, the gain realized on disposition generally will be treated
as a short-term capital gain. In general, any gain realized on disposition
of a security held less than one year is treated as a short-term capital
gain.

Dividend and interest income received by the fund from sources outside the
United States may be subject to withholding and other taxes imposed by such
foreign jurisdictions. Tax conventions between certain countries and the
United States, however, may reduce or eliminate these foreign taxes. Most
foreign countries do not impose taxes on capital gains with respect to
investments by foreign investors.

CAPITAL GAIN DISTRIBUTIONS -- The fund also intends to follow the practice
of distributing the entire excess of net realized long-term capital gains
over net realized short-term capital losses. Net capital gains for a fiscal
year are computed by taking into account any capital loss carry forward of
the fund.

If any net long-term capital gains in excess of net short-term capital
losses are retained by the fund for reinvestment, requiring federal income
taxes to be paid thereon by the fund, the fund intends to elect to treat
such capital gains as having been distributed to shareholders. As a result,
each shareholder will report such capital gains as long-term

New World Fund -- Page 37
<PAGE>

capital gains taxable to individual shareholders at a maximum 15% capital
gains rate, will be able to claim a pro rata share of federal income taxes
paid by the fund on such gains as a credit against personal federal income
tax liability, and will be entitled to increase the adjusted tax basis on
fund shares by the difference between a pro rata share of the retained
gains and such shareholder's related tax credit.

SHAREHOLDER TAXATION -- In January of each year, individual shareholders holding
fund shares in taxable accounts will receive a statement of the federal income
tax status of all distributions. Shareholders of the fund also may be subject to
state and local taxes on distributions received from the fund.

DIVIDENDS -- Fund dividends are taxable to shareholders as ordinary income.
Under the 2003 Tax Act, all or a portion of a fund's dividend distribution
may be a "qualified dividend." If the fund meets the applicable holding
period requirement, it will distribute dividends derived from qualified
corporation dividends to shareholders as qualified dividends. Interest
income from bonds and money market instruments and nonqualified foreign
dividends will be distributed to shareholders as nonqualified fund
dividends. The fund will report on Form 1099-DIV the amount of each
shareholder's dividend that may be treated as a qualified dividend. If a
shareholder meets the requisite holding period requirement, qualified
dividends are taxable at a maximum rate of 15%.

CAPITAL GAINS -- Distributions of the excess of net long-term capital gains
over net short-term capital losses that the fund properly designates as
"capital gain dividends" generally will be taxable as long-term capital
gain. Regardless of the length of time the shares of the fund have been
held by a shareholder, a capital gain distribution by the fund is subject
to a maximum tax rate of 15%. Any loss realized upon the redemption of
shares held at the time of redemption for six months or less from the date
of their purchase will be treated as a long-term capital loss to the extent
of any amounts treated as distributions of long-term capital gains during
such six-month period.

Distributions by the fund result in a reduction in the net asset value of the
fund's shares. Investors should consider the tax implications of buying shares
just prior to a distribution. The price of shares purchased at that time
includes the amount of the forthcoming distribution. Those purchasing just prior
to a distribution will subsequently receive a partial return of their investment
capital upon payment of the distribution, which will be taxable to them.

The fund may make the election permitted under Section 853 of the Code so that
shareholders may (subject to limitations) be able to claim a credit or deduction
on their federal income tax returns for, and will be required to treat as part
of the amounts distributed to them, their pro rata portion of qualified taxes
paid by the fund to foreign countries (such taxes relate primarily to investment
income). The fund may make an election under Section 853 of the Code, provided
that more than 50% of the value of the total assets of the fund at the close of
the taxable year consists of securities of foreign corporations. The foreign tax
credit available to shareholders is subject to certain limitations imposed by
the Code.

Redemptions of shares, including exchanges for shares of other American Funds,
may result in federal, state and local tax consequences (gain or loss) to the
shareholder. However, conversion from one class to another class in the same
fund should not be a taxable event.

New World Fund -- Page 38
<PAGE>

If a shareholder exchanges or otherwise disposes of shares of the fund within 90
days of having acquired such shares, and if, as a result of having acquired
those shares, the shareholder subsequently pays a reduced sales charge for
shares of the fund, or of a different fund, the sales charge previously incurred
in acquiring the fund's shares will not be taken into account (to the extent
such previous sales charges do not exceed the reduction in sales charges) for
the purposes of determining the amount of gain or loss on the exchange, but will
be treated as having been incurred in the acquisition of such other fund(s).

Any loss realized on a redemption or exchange of shares of the fund will be
disallowed to the extent substantially identical shares are reacquired within
the 61-day period beginning 30 days before and ending 30 days after the shares
are disposed of. Any loss disallowed under this rule will be added to the
shareholder's tax basis in the new shares purchased.

The fund will be required to report to the IRS all distributions of investment
company taxable income and capital gains as well as gross proceeds from the
redemption or exchange of fund shares, except in the case of certain exempt
shareholders. Under the backup withholding provisions of Section 3406 of the
Code, distributions of investment company taxable income and capital gains and
proceeds from the redemption or exchange of a regulated investment company may
be subject to backup withholding of federal income tax in the case of non-exempt
U.S. shareholders who fail to furnish the investment company with their taxpayer
identification numbers and with required certifications regarding their status
under the federal income tax law. Withholding may also be required if the fund
is notified by the IRS or a broker that the taxpayer identification number
furnished by the shareholder is incorrect or that the shareholder has previously
failed to report interest or dividend income. If the withholding provisions are
applicable, any such distributions and proceeds, whether taken in cash or
reinvested in additional shares, will be reduced by the amounts required to be
withheld.

The foregoing discussion of U.S. federal income tax law relates solely to the
application of that law to U.S. persons (i.e., U.S. citizens and residents and
U.S. corporations, partnerships, trusts and estates). Each shareholder who is
not a U.S. person should consider the U.S. and foreign tax consequences of
ownership of shares of the fund, including the possibility that such a
shareholder may be subject to a U.S. withholding tax at a rate of 30% (or a
lower rate under an applicable income tax treaty) on dividend income received by
the shareholder.

Shareholders should consult their tax advisers about the application of federal,
state and local tax law in light of their particular situation.

UNLESS OTHERWISE NOTED, ALL REFERENCES IN THE FOLLOWING PAGES TO CLASS A, B, C
OR F SHARES ALSO REFER TO THE CORRESPONDING CLASS 529-A, 529-B, 529-C OR 529-F
SHARES. CLASS 529 SHAREHOLDERS SHOULD ALSO REFER TO THE COLLEGEAMERICA PROGRAM
DESCRIPTION FOR INFORMATION ON POLICIES AND SERVICES SPECIFICALLY RELATING TO
COLLEGEAMERICA ACCOUNTS. SHAREHOLDERS HOLDING SHARES THROUGH AN ELIGIBLE
RETIREMENT PLAN SHOULD CONTACT THEIR PLAN'S ADMINISTRATOR OR RECORDKEEPER FOR
INFORMATION REGARDING PURCHASES, SALES AND EXCHANGES.

PURCHASE AND EXCHANGE OF SHARES

PURCHASES BY INDIVIDUALS -- As described in the prospectus, you may generally
open an account and purchase fund shares by contacting a financial adviser or
investment dealer authorized to sell the fund's shares. You may make investments
by any of the following means:

New World Fund -- Page 39
<PAGE>

CONTACTING YOUR FINANCIAL ADVISER -- Deliver or mail a check to your
financial adviser.

BY MAIL -- for initial investments, you may mail a check, made payable to
the fund, directly to the address indicated on the account application.
Please indicate an investment dealer on the account application. You may
make additional investments by filling out the "Account Additions" form at
the bottom of a recent account statement and mailing the form, along with a
check made payable to the fund, using the envelope provided with your
account statement.

BY TELEPHONE -- using the American FundsLine. Please see the "Shareholder
account services and privileges" section of this document for more
information regarding this service.

BY INTERNET -- using americanfunds.com. Please see the "Shareholder account
services and privileges" section of this document for more information
regarding this service.

BY WIRE -- If you are making a wire transfer, instruct your bank to wire
funds to:

Wells Fargo Bank
ABA Routing No. 121000248
Account No. 4600-076178

Your bank should include the following information when wiring funds:

For credit to the account of:
American Funds Service Company
(fund's name)

For further credit to:
(shareholder's fund account number)
(shareholder's name)

You may contact American Funds Service Company at 800/421-0180 if you have
questions about making wire transfers.

All investments are subject to the purchase minimums and maximums described in
the prospectus. The fund and the Principal Underwriter reserve the right to
reject any purchase order.

The Principal Underwriter will not knowingly sell shares of the fund directly or
indirectly to any person or entity, where, after the sale, such person or entity
would own beneficially directly or indirectly more than 4.5% of the outstanding
shares of the fund without the consent of a majority of the fund's Board.

Class 529 shares may be purchased by investors only through CollegeAmerica
accounts. Class 529-E shares may be purchased only by investors participating in
CollegeAmerica through an eligible employer plan. In addition, the American
Funds state tax-exempt funds are qualified for sale only in certain
jurisdictions, and tax-exempt funds in general should not serve as retirement
plan investments.

New World Fund -- Page 40
<PAGE>

EXCHANGES -- You may only exchange shares into other American Funds within the
same share class. However, exchanges from Class A shares of The Cash Management
Trust of America may be made to Class B or C shares of other American Funds for
dollar cost averaging purposes. Exchange purchases are subject to the minimum
investment requirements of the fund purchased and no sales charge generally
applies. However, exchanges of shares from American Funds money market funds are
subject to applicable sales charges on the fund being purchased, unless the
money market fund shares were acquired by an exchange from a fund having a sales
charge, or by reinvestment or cross-reinvestment of dividends or capital gain
distributions. Exchanges of Class F shares generally may only be made through
fee-based programs of investment firms that have special agreements with the
fund's distributor and certain registered investment advisers.

You may exchange shares of other classes by contacting the Transfer Agent, by
contacting your investment dealer or financial adviser, by using American
FundsLine or americanfunds.com, or by telephoning 800/421-0180 toll-free, or
faxing (see "American Funds Service Company service areas" in the prospectus for
the appropriate fax numbers) the Transfer Agent. For more information, see
"Shareholder account services and privileges" below. THESE TRANSACTIONS HAVE THE
SAME TAX CONSEQUENCES AS ORDINARY SALES AND PURCHASES.

Shares held in employer-sponsored retirement plans may be exchanged into other
American Funds by contacting your plan administrator or recordkeeper. Exchange
redemptions and purchases are processed simultaneously at the share prices next
determined after the exchange order is received (see "Price of shares" above).

FREQUENT TRADING OF FUND SHARES -- As noted in the prospectus, certain
redemptions may trigger a purchase block lasting 30 calendar days under the
fund's "purchase blocking policy." Under this policy, systematic redemptions
will not trigger a purchase block and systematic purchases will not be
prevented. For purposes of this policy, systematic redemptions include, for
example, regular periodic automatic redemptions and statement of intention
escrow share redemptions. Systematic purchases include, for example, regular
periodic automatic purchases and automatic reinvestments of dividends and
capital gain distributions.

OTHER POTENTIALLY ABUSIVE ACTIVITY -- In addition to implementing purchase
blocks, American Funds Service Company will monitor for other types of activity
that could potentially be harmful to the American Funds - for example,
short-term trading activity in multiple funds. When identified, American Funds
Service Company will request that the shareholder discontinue the activity. If
the activity continues, American Funds Service Company will freeze the
shareholder account to prevent all activity other than redemptions of fund
shares.

SALES CHARGES
CLASS A PURCHASES

PURCHASES BY CERTAIN 403(B) PLANS

Individual 403(b) plans may be treated similarly to employer-sponsored
plans for Class A sales charge purposes (i.e., individual participant
accounts are eligible to be aggregated together) if: (a) the American Funds
are principal investment options; (b) the employer facilitates the
enrollment process by, for example, allowing for onsite group enrollment
meetings held during working hours; and (c) there is only one dealer firm
assigned to the plans.

New World Fund -- Page 41
<PAGE>

OTHER PURCHASES
Pursuant to a determination of eligibility by a vice president or more
senior officer of the Capital Research and Management Company Fund
Administration Unit, or by his or her designee, Class A shares of the
American Funds stock, stock/bond and bond funds may be sold at net asset
value to:

(1)current or retired directors, trustees, officers and advisory board
members of, and certain lawyers who provide services to, the funds
managed by Capital Research and Management Company, current or retired
employees of Washington Management Corporation, current or retired
employees and partners of The Capital Group Companies, Inc. and its
affiliated companies, certain family members and employees of the
above persons, and trusts or plans primarily for such persons;
(2) currently registered representatives and assistants directly employed
by such representatives, retired registered representatives with
respect to accounts established while active, or full-time employees
(collectively, "Eligible Persons") (and their (a) spouses or
equivalents if recognized under local law, (b) parents and children,
including parents and children in step and adoptive relationships,
sons-in-law and daughters-in-law, and (c) parents-in-law, if the
Eligible Persons or the spouses, children or parents of the Eligible
Persons are listed in the account registration with the
parents-in-law) of dealers who have sales agreements with the
Principal Underwriter (or who clear transactions through such
dealers), plans for the dealers, and plans that include as
participants only the Eligible Persons, their spouses, parents and/or
children;

(3) currently registered investment advisers ("RIAs") and assistants
directly employed by such RIAs, retired RIAs with respect to accounts
established while active, or full-time employees (collectively,
"Eligible Persons") (and their (a) spouses or equivalents if
recognized under local law, (b) parents and children, including
parents and children in step and adoptive relationships, sons-in-law
and daughters-in-law and (c) parents-in-law, if the Eligible Persons
or the spouses, children or parents of the Eligible Persons are listed
in the account registration with the parents-in-law) of RIA firms that
are authorized to sell shares of the funds, plans for the RIA firms,
and plans that include as participants only the Eligible Persons,
their spouses, parents and/or children;

(4) companies exchanging securities with the fund through a merger,
acquisition or exchange offer;

(5) insurance company separate accounts;

(6) accounts managed by subsidiaries of The Capital Group Companies, Inc.;

(7) The Capital Group Companies, Inc., its affiliated companies and
Washington Management Corporation;

(8) an individual or entity with a substantial business relationship with
The Capital Group Companies, Inc. or its affiliates, or an individual
or entity related or relating to such individual or entity;

(9) wholesalers and full-time employees directly supporting wholesalers
involved in the distribution of insurance company separate accounts
whose underlying

New World Fund -- Page 42
<PAGE>

investments are managed by any affiliate of The Capital Group
Companies, Inc.; and

(10) full-time employees of banks that have sales agreements with the
Principal Underwriter, who are solely dedicated to directly supporting
the sale of mutual funds.

Shares are offered at net asset value to these persons and organizations
due to anticipated economies in sales effort and expense. Once an account
is established under this net asset value privilege, additional investments
can be made at net asset value for the life of the account.

DEALER COMMISSIONS AND COMPENSATION -- Commissions (up to 1.00%) are paid to
dealers who initiate and are responsible for certain Class A share purchases not
subject to sales charges. These purchases consist of purchases of $1 million or
more, purchases by employer-sponsored defined contribution-type retirement plans
investing $1 million or more or with 100 or more eligible employees, and
purchases made at net asset value by certain retirement plans, endowments and
foundations with assets of $50 million or more. Commissions on such investments
(other than IRA rollover assets that roll over at no sales charge under the
fund's IRA rollover policy as described in the prospectus) are paid to dealers
at the following rates: 1.00% on amounts to $4 million, 0.50% on amounts over $4
million to $10 million and 0.25% on amounts over $10 million. Commissions are
based on cumulative investments and are not annually reset.

A dealer concession of up to 1% may be paid by the fund under its Class A plan
of distribution to reimburse the Principal Underwriter in connection with dealer
and wholesaler compensation paid by it with respect to investments made with no
initial sales charge.

SALES CHARGE REDUCTIONS AND WAIVERS

REDUCING YOUR CLASS A SALES CHARGE -- As described in the prospectus, there are
various ways to reduce your sales charge when purchasing Class A shares.
Additional information about Class A sales charge reductions is provided below.

STATEMENT OF INTENTION -- By establishing a statement of intention (the
"Statement"), you enter into a nonbinding commitment to purchase shares of
American Funds non-money market funds over a 13-month period and receive
the same sales charge as if all shares had been purchased at once.

When a shareholder elects to use a Statement, shares equal to 5% of the
dollar amount specified in the Statement will be held in escrow in the
shareholder's account out of the initial purchase (or subsequent purchases,
if necessary) by the Transfer Agent. All dividends and any capital gain
distributions on shares held in escrow will be credited to the
shareholder's account in shares (or paid in cash, if requested). If the
intended investment is not completed within the specified Statement period,
the purchaser will remit to the Principal Underwriter the difference
between the sales charge actually paid and the sales charge which would
have been paid if the total of such purchases had been made at a single
time. The dealer assigned to an account at the time of each purchase made
during the Statement period will receive an appropriate commission
adjustment. If the difference is not paid by the close of the Statement
period, the appropriate number of shares held in escrow will be redeemed to
pay such difference. If the proceeds from this redemption are

New World Fund -- Page 43
<PAGE>

inadequate, the purchaser will be liable to the Principal Underwriter for
the balance still outstanding.

The Statement may be revised upward at any time during the Statement
period, and such a revision will be treated as a new Statement, except that
the Statement period during which the purchase must be made will remain
unchanged. Accordingly, upon your request, the sales charge paid on
investments made 90 days prior to the Statement revision will be adjusted
to reflect the revised Statement.

The market value of your existing holdings eligible to be aggregated (see
below) as of the day immediately before the start of the Statement period,
may be credited toward satisfying the Statement.

The Statement will be considered completed if the shareholder dies within
the Statement period. Commissions to dealers will not be adjusted or paid
on the difference between the Statement amount and the amount actually
invested before the shareholder's death.

When the trustees of certain retirement plans purchase shares by payroll
deduction, the sales charge for the investments made during the Statement
period will be handled as follows: the total monthly investment will be
multiplied by 13 and then multiplied by 1.5. The market value of existing
American Funds investments (other than shares representing direct purchases
of money market funds) as of the day immediately before the start of the
Statement period, and any rollovers or transfers reasonably anticipated to
be invested in non-money market American Funds during the Statement period,
are added to the figure determined above. The sum is the Statement amount
and applicable breakpoint level. On the first investment and all other
investments made pursuant to the Statement, a sales charge will be assessed
according to the sales charge breakpoint thus determined. There will be no
retroactive adjustments in sales charges on investments made during the
Statement period.

Shareholders purchasing shares at a reduced sales charge under a Statement
indicate their acceptance of these terms and those in the prospectus with
their first purchase.

AGGREGATION -- Qualifying investments for aggregation include those made by
you and your "immediate family" as defined in the prospectus, if all
parties are purchasing shares for their own accounts and/or:

. individual-type employee benefit plan(s), such as an IRA, individual
403(b) plan (see exception in "Purchases by certain 403(b) plans"
under "Sales charges") or single-participant Keogh-type plan;

. business accounts solely controlled by you or your immediate family
(for example, you own the entire business);

. trust accounts established by you or your immediate family (For trusts
with only one primary beneficiary, upon the trustor's death the trust
account may be aggregated with such beneficiary's own accounts. For
trusts with multiple primary beneficiaries, upon the trustor's death
the trustees of the trust may instruct American Funds Service Company
to establish separate trust accounts for each primary beneficiary.
Each primary beneficiary's separate trust account may then be
aggregated with such beneficiary's own accounts.);

New World Fund -- Page 44
<PAGE>

. endowments or foundations established and controlled by you or your
immediate family; or

. CollegeAmerica accounts, which will be aggregated at the account owner
level (Class 529-E accounts may only be aggregated with an eligible
employer plan).

Individual purchases by a trustee(s) or other fiduciary(ies) may also be
aggregated if the investments are:

. for a single trust estate or fiduciary account, including employee
benefit plans other than the individual-type employee benefit plans
described above;

. made for two or more employee benefit plans of a single employer or of
affiliated employers as defined in the 1940 Act, excluding the
individual-type employee benefit plans described above;

. for a diversified common trust fund or other diversified pooled
account not specifically formed for the purpose of accumulating fund
shares;

. for nonprofit, charitable or educational organizations, or any
endowments or foundations established and controlled by such
organizations, or any employer-sponsored retirement plans established
for the benefit of the employees of such organizations, their
endowments, or their foundations; or

. for individually established participant accounts of a 403(b) plan
that is treated similarly to an employer-sponsored plan for sales
charge purposes (see "Purchases by certain 403(b) plans" under "Sales
charges" above), or made for two or more such 403(b) plans that are
treated similarly to employer-sponsored plans for sales charge
purposes of a single employer or affiliated employers as defined in
the 1940 Act.

Purchases made for nominee or street name accounts (securities held in the
name of an investment dealer or another nominee such as a bank trust
department instead of the customer) may not be aggregated with those made
for other accounts and may not be aggregated with other nominee or street
name accounts unless otherwise qualified as described above.

CONCURRENT PURCHASES -- As described in the prospectus, you may reduce your
Class A sales charge by combining purchases of all classes of shares in the
American Funds, as well as individual holdings in Endowments, American
Legacy variable annuity contracts and variable life insurance policies.
Shares of money market funds purchased through an exchange, reinvestment or
cross-reinvestment from a fund having a sales charge also qualify. However,
direct purchases of American Funds money market funds are excluded.

RIGHTS OF ACCUMULATION -- Subject to the limitations described in the
aggregation policy, you may take into account your accumulated holdings in
all share classes of the American Funds, as well as your holdings in
Endowments, to determine your sales charge on investments in accounts
eligible to be aggregated. Subject to your investment dealer's or
recordkeeper's capabilities, your accumulated holdings will be calculated
as the higher of (a) the current value of your existing holdings (the
"market value") or (b) the amount you invested (including reinvested
dividends and capital gains, but excluding capital appreciation) less any
withdrawals (the "cost value"). Depending on the entity on whose books your
account is held, the value of your holdings in that account may not be
eligible for cal-

New World Fund -- Page 45
<PAGE>

culation at cost value. For example, the value of accounts held in nominee
or street name are not eligible for calculation at cost value and instead
will be calculated at market value for purposes of rights of accumulation.

The value of all of your holdings in accounts established in calendar year
2005 or earlier will be assigned an initial cost value equal to the market
value of those holdings as of the last business day of 2005. Thereafter,
the cost value of such accounts will increase or decrease according to
actual investments or withdrawals. You must contact your financial adviser
or American Funds Service Company if you have additional information that
is relevant to the calculation of the value of your holdings.

When determining your American Funds Class A sales charge, if you are not
an employer-sponsored retirement plan, you may also take into account the
market value (as of the end of the week prior to your American Funds
investment) of your individual holdings in various American Legacy variable
annuity contracts and variable life insurance policies. An
employer-sponsored retirement plan may also take into account the market
value of its investments in American Legacy Retirement Investment Plans.
Direct purchases of American Funds money market funds are excluded. If you
make a gift of American Funds Class A shares, upon your request, you may
purchase the shares at the sales charge discount allowed under rights of
accumulation of all of your American Funds and American Legacy accounts.

CDSC WAIVERS FOR CLASS A, B AND C SHARES -- As noted in the prospectus, a
contingent deferred sales charge ("CDSC") may be waived for redemptions due to
death or postpurchase disability of a shareholder (this generally excludes
accounts registered in the names of trusts and other entities). In the case of
joint tenant accounts, if one joint tenant dies, a surviving joint tenant, at
the time he or she notifies the Transfer Agent of the other joint tenant's death
and removes the decedent's name from the account, may redeem shares from the
account without incurring a CDSC. Redemptions made after the Transfer Agent is
notified of the death of a joint tenant will be subject to a CDSC.

In addition, a CDSC may be waived for the following types of transactions, if
together they do not exceed 12% of the value of an "account" (defined below)
annually (the "12% limit"):

. Required minimum distributions taken from retirement accounts upon the
shareholder's attainment of age 70-1/2 (required minimum distributions
that continue to be taken by the beneficiary(ies) after the account
owner is deceased also qualify for a waiver).

. Redemptions through a systematic withdrawal plan (SWP) (see "Automatic
withdrawals" under "Shareholder account services and privileges"
below). For each SWP payment, assets that are not subject to a CDSC,
such as appreciation on shares and shares acquired through
reinvestment of dividends and/or capital gain distributions, will be
redeemed first and will count toward the 12% limit. If there is an
insufficient amount of assets not subject to a CDSC to cover a
particular SWP payment, shares subject to the lowest CDSC will be
redeemed next until the 12% limit is reached. Any dividends and/or
capital gain distributions taken in cash by a shareholder who receives
payments through a SWP will also count toward the 12% limit. In the
case of a SWP, the 12% limit is calculated at the time a systematic
redemption is first made, and is recalculated at the time each

New World Fund -- Page 46
<PAGE>

additional systematic redemption is made. Shareholders who establish a
SWP should be aware that the amount of a payment not subject to a CDSC
may vary over time depending on fluctuations in the value of their
accounts. This privilege may be revised or terminated at any time.

For purposes of this paragraph, "account" means:

. in the case of Class A shares, your investment in Class A shares of
all American Funds (investments representing direct purchases of
American Funds money market funds are excluded);

. in the case of Class B shares, your investment in Class B shares of
the particular fund from which you are making the redemption; and

. in the case of Class C shares, your investment in Class C shares of
the particular fund from which you are making the redemption.

CDSC waivers are allowed only in the cases listed here and in the prospectus.
For example, CDSC waivers will not be allowed on redemptions of Class 529-B and
529-C shares due to termination of CollegeAmerica; a determination by the
Internal Revenue Service that CollegeAmerica does not qualify as a qualified
tuition program under the Code; proposal or enactment of law that eliminates or
limits the tax-favored status of CollegeAmerica; or the Virginia College Savings
Plan eliminating the fund as an option for additional investment within
CollegeAmerica.

SELLING SHARES

The methods for selling (redeeming) shares are described more fully in the
prospectus. If you wish to sell your shares by contacting American Funds Service
Company directly, any such request must be signed by the registered
shareholders.

A signature guarantee may be required for certain redemptions. In such an event,
your signature may be guaranteed by a domestic stock exchange or the National
Association of Securities Dealers, Inc., bank, savings association or credit
union that is an eligible guarantor institution. The Transfer Agent reserves the
right to require a signature guarantee on any redemptions.

Additional documentation may be required for sales of shares held in corporate,
partnership or fiduciary accounts. You must include with your written request
any shares you wish to sell that are in certificate form.

If you sell Class A, B or C shares and request a specific dollar amount to be
sold, we will sell sufficient shares so that the sale proceeds, after deducting
any applicable CDSC, equals the dollar amount requested.

Redemption proceeds will not be mailed until sufficient time has passed to
provide reasonable assurance that checks or drafts (including certified or
cashier's checks) for shares purchased have cleared (which may take up to 15
calendar days from the purchase date). Except for delays relating to clearance
of checks for share purchases or in extraordinary circumstances (and as
permissible under the 1940 Act), sale proceeds will be paid on or before the
seventh day following receipt and acceptance of an order. Interest will not
accrue or be paid on amounts that represent uncashed distribution or redemption
checks.

New World Fund -- Page 47
<PAGE>

You may request that redemption proceeds of $1,000 or more from money market
funds be wired to your bank by writing American Funds Service Company. A
signature guarantee is required on all requests to wire funds.

SHAREHOLDER ACCOUNT SERVICES AND PRIVILEGES

The following services and privileges are generally available to all
shareholders. However, certain services and privileges may not be available for
Class 529 shareholders or if your account is held with an investment dealer or
through an employer-sponsored retirement plan.

AUTOMATIC INVESTMENT PLAN -- An automatic investment plan enables you to make
monthly or quarterly investments in the American Funds through automatic debits
from your bank account. To set up a plan, you must fill out an account
application and specify the amount that you would like to invest ($50 minimum)
and the date on which you would like your investments to occur. The plan will
begin within 30 days after your account application is received. Your bank
account will be debited on the day or a few days before your investment is made,
depending on the bank's capabilities. The Transfer Agent will then invest your
money into the fund you specified on or around the date you specified. If the
date you specified falls on a weekend or holiday, your money will be invested on
the following business day. However, if the following business day falls in the
next month, your money will be invested on the business day immediately
preceding the weekend or holiday. If your bank account cannot be debited due to
insufficient funds, a stop-payment or the closing of the account, the plan may
be terminated and the related investment reversed. You may change the amount of
the investment or discontinue the plan at any time by contacting the Transfer
Agent.

AUTOMATIC REINVESTMENT -- Dividends and capital gain distributions are
reinvested in additional shares of the same class and fund at net asset value
unless you indicate otherwise on the account application. You also may elect to
have dividends and/or capital gain distributions paid in cash by informing the
fund, the Transfer Agent or your investment dealer. Dividends and capital gain
distributions paid to retirement plan shareholders or shareholders of the 529
share classes will be automatically reinvested.

If you have elected to receive dividends and/or capital gain distributions in
cash, and the postal or other delivery service is unable to deliver checks to
your address of record, or you do not respond to mailings from American Funds
Service Company with regard to uncashed distribution checks, your distribution
option will automatically be converted to having all dividends and other
distributions reinvested in additional shares.

CROSS-REINVESTMENT OF DIVIDENDS AND DISTRIBUTIONS -- For all share classes,
except the 529 classes of shares, you may cross-reinvest dividends and capital
gains (distributions) into other American Funds in the same share class at net
asset value, subject to the following conditions:

(1) the aggregate value of your account(s) in the fund(s) paying distributions
equals or exceeds $5,000 (this is waived if the value of the account in the fund
receiving the distributions equals or exceeds that fund's minimum initial
investment requirement);

(2) if the value of the account of the fund receiving distributions is below
the minimum initial investment requirement, distributions must be automatically
reinvested; and

New World Fund -- Page 48
<PAGE>

(3) if you discontinue the cross-reinvestment of distributions, the value of
the account of the fund receiving distributions must equal or exceed the minimum
initial investment requirement. If you do not meet this requirement within 90
days of notification, the fund has the right to automatically redeem the
account.

AUTOMATIC EXCHANGES -- For all share classes, you may automatically exchange
shares of the same class in amounts of $50 or more among any of the American
Funds on any day (or preceding business day if the day falls on a nonbusiness
day) of each month you designate.

AUTOMATIC WITHDRAWALS -- For all share classes, except the R and 529 classes of
shares, you may automatically withdraw shares from any of the American Funds.
You can make automatic withdrawals of $50 or more as often as you wish if your
account is worth at least $10,000, or up to four times a year for an account
worth at least $5,000. You can designate the day of each period for withdrawals
and request that checks be sent to you or someone else. Withdrawals may also be
electronically deposited to your bank account. The Transfer Agent will withdraw
your money from the fund you specify on or around the date you specify. If the
date you specified falls on a weekend or holiday, the redemption will take place
on the previous business day. However, if the previous business day falls in the
preceding month, the redemption will take place on the following business day
after the weekend or holiday.

Withdrawal payments are not to be considered as dividends, yield or income.
Automatic investments may not be made into a shareholder account from which
there are automatic withdrawals. Withdrawals of amounts exceeding reinvested
dividends and distributions and increases in share value would reduce the
aggregate value of the shareholder's account. The Transfer Agent arranges for
the redemption by the fund of sufficient shares, deposited by the shareholder
with the Transfer Agent, to provide the withdrawal payment specified.

ACCOUNT STATEMENTS -- Your account is opened in accordance with your
registration instructions. Transactions in the account, such as additional
investments, will be reflected on regular confirmation statements from the
Transfer Agent. Dividend and capital gain reinvestments, purchases through
automatic investment plans and certain retirement plans, as well as automatic
exchanges and withdrawals will be confirmed at least quarterly.

AMERICAN FUNDSLINE AND AMERICANFUNDS.COM -- You may check your share balance,
the price of your shares or your most recent account transaction; redeem shares
(up to $75,000 per American Funds shareholder each day) from nonretirement plan
accounts; or exchange shares around the clock with American FundsLine or using
americanfunds.com. To use American FundsLine, call 800/325-3590 from a
TouchTone(TM) telephone. Redemptions and exchanges through American FundsLine
and americanfunds.com are subject to the conditions noted above and in
"Telephone and Internet purchases, redemptions and exchanges" below. You will
need your fund number (see the list of the American Funds under "General
information -- fund numbers"), personal identification number (generally the
last four digits of your Social Security number or other tax identification
number associated with your account) and account number.

Generally, all shareholders are automatically eligible to use these services.
However, if you are not currently authorized to do so, you may complete an
American FundsLink Authorization Form. Once you establish this privilege, you,
your financial adviser or any person with your account information may use these
services.

New World Fund -- Page 49
<PAGE>

TELEPHONE AND INTERNET PURCHASES, REDEMPTIONS AND EXCHANGES -- By using the
telephone (including American FundsLine) or the Internet (including
americanfunds.com), or fax purchase, redemption and/or exchange options, you
agree to hold the fund, the Transfer Agent, any of its affiliates or mutual
funds managed by such affiliates, and each of their respective directors,
trustees, officers, employees and agents harmless from any losses, expenses,
costs or liability (including attorney fees) that may be incurred in connection
with the exercise of these privileges. Generally, all shareholders are
automatically eligible to use these services. However, you may elect to opt out
of these services by writing the Transfer Agent (you may also reinstate them at
any time by writing the Transfer Agent). If the Transfer Agent does not employ
reasonable procedures to confirm that the instructions received from any person
with appropriate account information are genuine, it and/or the fund may be
liable for losses due to unauthorized or fraudulent instructions. In the event
that shareholders are unable to reach the fund by telephone because of technical
difficulties, market conditions or a natural disaster, redemption and exchange
requests may be made in writing only.

CHECKWRITING -- You may establish check writing privileges for Class A shares
(but not Class 529-A shares) of American Funds money market funds. This can be
done by using an account application. If you request check writing privileges,
you will be provided with checks that you may use to draw against your account.
These checks may be made payable to anyone you designate and must be signed by
the authorized number of registered shareholders exactly as indicated on your
account application.

REDEMPTION OF SHARES -- The fund's Articles of Incorporation permit the fund to
direct the Transfer Agent to redeem the shares of any shareholder for their then
current net asset value per share if at such time the shareholder of record owns
shares having an aggregate net asset value of less than the minimum initial
investment amount required of new shareholders as set forth in the fund's
current registration statement under the 1940 Act, and subject to such further
terms and conditions as the Board of Directors of the fund may from time to time
adopt.

While payment of redemptions normally will be in cash, the fund's Articles of
Incorporation permit payment of the redemption price wholly or partly in
securities or other property included in the assets belonging to the fund when
in the opinion of the fund's Board of Directors, which shall be conclusive,
conditions exist which make payment wholly in cash unwise or undesirable.

SHARE CERTIFICATES -- Shares are credited to your account and certificates are
not issued unless you request them by contacting the Transfer Agent.
Certificates are not available for the 529 or R share classes.

GENERAL INFORMATION
CUSTODIAN OF ASSETS -- Securities and cash owned by the fund, including proceeds
from the sale of shares of the fund and of securities in the fund's portfolio,
are held by JPMorgan Chase Bank, 270 Park Avenue, New York, NY 10017-2070, as
Custodian. If the fund holds non-U.S. securities, the Custodian may hold these
securities pursuant to subcustodial arrangements in non-U.S. banks or non-U.S.
branches of U.S. banks.

TRANSFER AGENT -- American Funds Service Company, a wholly owned subsidiary of
the investment adviser, maintains the records of shareholder accounts, processes
purchases and redemptions of the fund's shares, acts as dividend and capital
gain distribution disbursing agent, and performs other related shareholder
service functions. The principal office of American Funds

New World Fund -- Page 50
<PAGE>

Service Company is located at 135 South State College Boulevard, Brea, CA
92821-5823. American Funds Service Company was paid a fee of $3,753,000 for
Class A shares and $181,000 for Class B shares for the 2005 fiscal year.

In the case of certain shareholder accounts, third parties who may be
unaffiliated with the investment adviser provide transfer agency and shareholder
services in place of American Funds Service Company. These services are rendered
under agreements with American Funds Service Company or its affiliates and the
third parties receive compensation according to such agreements. Compensation
for transfer agency and shareholder services, whether paid to American Funds
Service Company or such third parties, is ultimately paid from fund assets and
is reflected in the expenses of the fund as disclosed in the prospectus.

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM -- Deloitte & Touche LLP, 695 Town
Center Drive, Costa Mesa, California 92626, serves as the fund's independent
registered public accounting firm, providing audit services, preparation of tax
returns and review of certain documents to be filed with the Securities and
Exchange Commission. The financial statements included in this statement of
additional information from the annual report have been so included in reliance
on the report of Deloitte & Touche LLP, independent registered public accounting
firm, given on the authority of said firm as experts in accounting and auditing.
The selection of the fund's independent registered public accounting firm is
reviewed and determined annually by the Board of Directors.

INDEPENDENT LEGAL COUNSEL -- Kirkpatrick & Lockhart Nicholson Graham LLP, Four
Embarcadero Center, 10th Floor, San Francisco, CA 94111, serves as counsel for
the fund and for Non-Interested Directors in their capacities as such. Counsel
does not provide legal services to the fund's investment adviser, but provides
an insignificant amount of legal services unrelated to the operations of the
fund to an investment adviser affiliate. A determination with respect to the
independence of the fund's "independent legal counsel" will be made at least
annually by the Non-Interested Directors of the fund, as prescribed by the 1940
Act and related rules.

PROSPECTUSES, REPORTS TO SHAREHOLDERS AND PROXY STATEMENTS -- The fund's fiscal
year ends on October 31. Shareholders are provided updated prospectuses annually
and at least semiannually with reports showing the summary investment portfolio,
financial statements and other information. The fund's annual financial
statements are audited by the fund's independent registered public accounting
firm, Deloitte & Touche LLP. In addition, shareholders may also receive proxy
statements for the fund. In an effort to reduce the volume of mail shareholders
receive from the fund when a household owns more than one account, the Transfer
Agent has taken steps to eliminate duplicate mailings of prospectuses,
shareholder reports and proxy statements. To receive additional copies of a
prospectus, report or proxy statement, shareholders should contact the Transfer
Agent.

CODES OF ETHICS -- The fund and Capital Research and Management Company and its
affiliated companies, including the fund's Principal Underwriter, have adopted
codes of ethics that allow for personal investments, including securities in
which the fund may invest from time to time. These codes include a ban on
acquisitions of securities pursuant to an initial public offering; restrictions
on acquisitions of private placement securities; preclearance and reporting
requirements; review of duplicate confirmation statements; annual
recertification of compliance with codes of ethics; blackout periods on personal
investing for certain investment personnel; ban on short-term trading profits
for investment personnel; limitations on service as a director of publicly
traded companies; and disclosure of personal securities transactions.

New World Fund -- Page 51
<PAGE>

LEGAL PROCEEDINGS -- On February 16, 2005, the NASD filed an administrative
complaint against the Principal Underwriter. The complaint alleges violations of
certain NASD rules by the Principal Underwriter with respect to the selection of
broker-dealer firms that buy and sell securities for mutual fund investment
portfolios. The complaint seeks sanctions, restitution and disgorgement.

On March 24, 2005, the investment adviser and Principal Underwriter filed a
complaint against the Attorney General of the State of California in Los Angeles
County Superior Court. The complaint alleged that the Attorney General
threatened to take enforcement actions against the investment adviser and
Principal Underwriter that are without merit and preempted by federal law. On
the same day, following the filing of the investment adviser's and Principal
Underwriter's complaint, the Attorney General of the State of California filed a
complaint against the Principal Underwriter and investment adviser. Filed in Los
Angeles County Superior Court, the Attorney General's complaint alleged
violations of certain sections of the California Corporations Code with respect
to so-called "revenue sharing" disclosures in mutual fund prospectuses and
statements of additional information. On November 22, 2005, the Los Angeles
Superior Court dismissed the Attorney General's complaint. The Attorney General
may appeal this decision, subject to certain timing requirements.

The investment adviser and Principal Underwriter believe that the likelihood
that these matters could have a material adverse effect on the fund or on the
ability of the investment adviser or Principal Underwriter to perform their
contracts with the fund is remote. The SEC is conducting a related investigation
as of the date of this statement of additional information. The investment
adviser and Principal Underwriter are cooperating fully. In addition, a class
action lawsuit has been filed in the U.S. District Court, Central District of
California, raising issues related to so called "directed brokerage" and
"revenue sharing" practices. Further updates on these issues will be available
on the American Funds website (americanfunds.com) under "American Funds
regulatory matters."

OTHER INFORMATION -- The financial statements including the investment portfolio
and the report of the fund's independent registered public accounting firm
contained in the annual report are included in this statement of additional
information. The following information is not included in the annual report:

DETERMINATION OF NET ASSET VALUE, REDEMPTION PRICE AND MAXIMUM OFFERING PRICE
PER SHARE FOR CLASS A SHARES -- OCTOBER 31, 2005

Net asset value and redemption price per share
(Net assets divided by shares outstanding). . $36.32
Maximum offering price per share
(100/94.25 of net asset value per share,
which takes into account the fund's current maximum
sales charge). . . . . . . . . . . . . . . . $38.54

New World Fund -- Page 52
<PAGE>

FUND NUMBERS -- Here are the fund numbers for use with our automated telephone
line, American FundsLine/(R)/, or when making share transactions:

FUND NUMBERS
------------------------------------
FUND CLASS A CLASS B CLASS C CLASS F
-----------------------------------------------------------------------------------------------------

STOCK AND STOCK/BOND FUNDS
AMCAP Fund/(R)/ . . . . . . . . . . . . . . . . . . . . . . . 002 202 302 402
American Balanced Fund/(R)/ . . . . . . . . . . . . . . . . . 011 211 311 411
American Mutual Fund/(R)/ . . . . . . . . . . . . . . . . . . 003 203 303 403
Capital Income Builder/(R)/ . . . . . . . . . . . . . . . . . 012 212 312 412
Capital World Growth and Income Fund/SM/ . . . . . . . . . . . 033 233 333 433
EuroPacific Growth Fund/(R)/ . . . . . . . . . . . . . . . . . 016 216 316 416
Fundamental Investors/SM/ . . . . . . . . . . . . . . . . . . 010 210 310 410
The Growth Fund of America/(R)/ . . . . . . . . . . . . . . . 005 205 305 405
The Income Fund of America/(R)/ . . . . . . . . . . . . . . . 006 206 306 406
The Investment Company of America/(R)/ . . . . . . . . . . . . 004 204 304 404
The New Economy Fund/(R)/ . . . . . . . . . . . . . . . . . . 014 214 314 414
New Perspective Fund/(R)/ . . . . . . . . . . . . . . . . . . 007 207 307 407
New World Fund/SM/ . . . . . . . . . . . . . . . . . . . . . . 036 236 336 436
SMALLCAP World Fund/(R)/ . . . . . . . . . . . . . . . . . . . 035 235 335 435
Washington Mutual Investors Fund/SM/ . . . . . . . . . . . . . 001 201 301 401
BOND FUNDS
American High-Income Municipal Bond Fund/(R)/ . . . . . . . . 040 240 340 440
American High-Income Trust/SM/ . . . . . . . . . . . . . . . . 021 221 321 421
The Bond Fund of America/SM/ . . . . . . . . . . . . . . . . . 008 208 308 408
Capital World Bond Fund/(R)/ . . . . . . . . . . . . . . . . . 031 231 331 431
Intermediate Bond Fund of America/SM/ . . . . . . . . . . . . 023 223 323 423
Limited Term Tax-Exempt Bond Fund of America/SM/ . . . . . . . 043 243 343 443
The Tax-Exempt Bond Fund of America/(R)/ . . . . . . . . . . . 019 219 319 419
The Tax-Exempt Fund of California/(R)/* . . . . . . . . . . . 020 220 320 420
The Tax-Exempt Fund of Maryland/(R)/* . . . . . . . . . . . . 024 224 324 424
The Tax-Exempt Fund of Virginia/(R)/* . . . . . . . . . . . . 025 225 325 425
U.S. Government Securities Fund/SM/ . . . . . . . . . . . . . 022 222 322 422
MONEY MARKET FUNDS
The Cash Management Trust of America/(R)/ . . . . . . . . . . 009 209 309 409
The Tax-Exempt Money Fund of America/SM/ . . . . . . . . . . . 039 N/A N/A N/A
The U.S. Treasury Money Fund of America/SM/ . . . . . . . . . 049 N/A N/A N/A
___________

*Qualified for sale only in certain jurisdictions.

New World Fund -- Page 53
<PAGE>

FUND NUMBERS
---------------------------------------------
CLASS CLASS CLASS CLASS CLASS
FUND 529-A 529-B 529-C 529-E 529-F
-------------------------------------------------------------------------------

STOCK AND STOCK/BOND FUNDS
AMCAP Fund . . . . . . . . . . 1002 1202 1302 1502 1402
American Balanced Fund . . . . 1011 1211 1311 1511 1411
American Mutual Fund . . . . . 1003 1203 1303 1503 1403
Capital Income Builder . . . . 1012 1212 1312 1512 1412
Capital World Growth and Income
Fund . . . . . . . . . . . . . 1033 1233 1333 1533 1433
EuroPacific Growth Fund . . . . 1016 1216 1316 1516 1416
Fundamental Investors . . . . . 1010 1210 1310 1510 1410
The Growth Fund of America . . 1005 1205 1305 1505 1405
The Income Fund of America . . 1006 1206 1306 1506 1406
The Investment Company of
America . . . . . . . . . . . . 1004 1204 1304 1504 1404
The New Economy Fund . . . . . 1014 1214 1314 1514 1414
New Perspective Fund . . . . . 1007 1207 1307 1507 1407
New World Fund . . . . . . . . 1036 1236 1336 1536 1436
SMALLCAP World Fund . . . . . . 1035 1235 1335 1535 1435
Washington Mutual Investors Fund
. . . . . . . . . . . . . . . 1001 1201 1301 1501 1401
BOND FUNDS
American High-Income Trust . . 1021 1221 1321 1521 1421
The Bond Fund of America . . . 1008 1208 1308 1508 1408
Capital World Bond Fund . . . . 1031 1231 1331 1531 1431
Intermediate Bond Fund of
America . . . . . . . . . . . . 1023 1223 1323 1523 1423
U.S. Government Securities Fund 1022 1222 1322 1522 1422
MONEY MARKET FUND
The Cash Management Trust of
America . . . . . . . . . . . . 1009 1209 1309 1509 1409

FUND NUMBERS
----------------------------------------
CLASS CLASS CLASS CLASS CLASS
FUND R-1 R-2 R-3 R-4 R-5
-------------------------------------------------------------------------------

STOCK AND STOCK/BOND FUNDS
AMCAP Fund . . . . . . . . . . . . . 2102 2202 2302 2402 2502
American Balanced Fund . . . . . . . 2111 2211 2311 2411 2511
American Mutual Fund . . . . . . . . 2103 2203 2303 2403 2503
Capital Income Builder . . . . . . . 2112 2212 2312 2412 2512
Capital World Growth and Income Fund 2133 2233 2333 2433 2533
EuroPacific Growth Fund . . . . . . 2116 2216 2316 2416 2516
Fundamental Investors . . . . . . . 2110 2210 2310 2410 2510
The Growth Fund of America . . . . . 2105 2205 2305 2405 2505
The Income Fund of America . . . . . 2106 2206 2306 2406 2506
The Investment Company of America . 2104 2204 2304 2404 2504
The New Economy Fund . . . . . . . . 2114 2214 2314 2414 2514
New Perspective Fund . . . . . . . . 2107 2207 2307 2407 2507
New World Fund . . . . . . . . . . . 2136 2236 2336 2436 2536
SMALLCAP World Fund . . . . . . . . 2135 2235 2335 2435 2535
Washington Mutual Investors Fund . . 2101 2201 2301 2401 2501
BOND FUNDS
American High-Income Municipal Bond
Fund . . . . . . . . . . . . . . . . N/A N/A N/A N/A 2540
American High-Income Trust . . . . . 2121 2221 2321 2421 2521
The Bond Fund of America . . . . . . 2108 2208 2308 2408 2508
Capital World Bond Fund . . . . . . 2131 2231 2331 2431 2531
Intermediate Bond Fund of America . 2123 2223 2323 2423 2523
Limited Term Tax-Exempt Bond Fund of
America. . . . . . . . . . . . . . . N/A N/A N/A N/A 2543
The Tax-Exempt Bond Fund of America N/A N/A N/A N/A 2519
The Tax-Exempt Fund of California* . N/A N/A N/A N/A 2520
The Tax-Exempt Fund of Maryland* . . N/A N/A N/A N/A 2524
The Tax-Exempt Fund of Virginia* . . N/A N/A N/A N/A 2525
U.S. Government Securities Fund . . 2122 2222 2322 2422 2522
MONEY MARKET FUNDS
The Cash Management Trust of America 2109 2209 2309 2409 2509
The Tax-Exempt Money Fund of America N/A N/A N/A N/A 2539
The U.S. Treasury Money Fund of
America . . . . . . . . . . . . . . 2149 2249 2349 2449 2549
___________

*Qualified for sale only in certain
jurisdictions.

New World Fund -- Page 54
<PAGE>

[This page intentionally left blank for this filing.]

New World Fund -- Page 55
<PAGE>

APPENDIX

The following descriptions of debt security ratings are based on information
provided by Moody's Investors Service and Standard & Poor's Corporation.

DESCRIPTION OF BOND RATINGS

MOODY'S
LONG-TERM RATING DEFINITIONS

Aaa
Obligations rated Aaa are judged to be of the highest quality, with minimal
credit risk.

Aa
Obligations rated Aa are judged to be of high quality and are subject to very
low credit risk.

A
Obligations rated A are considered upper-medium grade and are subject to low
credit risk.

Baa
Obligations rated Baa are subject to moderate credit risk. They are considered
medium-grade and as such may possess certain speculative characteristics.

Ba
Obligations rated Ba are judged to have speculative elements and are subject to
substantial credit risk.

B
Obligations rated B are considered speculative and are subject to high credit
risk.

Caa
Obligations rated Caa are judged to be of poor standing and are subject to very
high credit risk.

Ca
Obligations rated Ca are highly speculative and are likely in, or very near,
default, with some prospect of recovery of principal and interest.

C
Obligations rated C are the lowest rated class of bonds and are typically in
default, with little prospect for recovery of principal or interest.

NOTE: Moody's appends numerical modifiers 1, 2, and 3 to each generic rating
classification from Aa through Caa. The modifier 1 indicates that the obligation
ranks in the higher end of its generic rating category; the modifier 2 indicates
a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of
that generic rating category.

New World Fund -- Page 56
<PAGE>

STANDARD & POOR'S
LONG-TERM ISSUE CREDIT RATINGS

AAA
An obligation rated AAA has the highest rating assigned by Standard & Poor's.
The obligor's capacity to meet its financial commitment on the obligation is
extremely strong.

AA
An obligation rated AA differs from the highest-rated obligations only in small
degree. The obligor's capacity to meet its financial commitment on the
obligation is very strong.

A
An obligation rated A is somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than obligations in
higher-rated categories. However, the obligor's capacity to meet its financial
commitment on the obligation is still strong.

BBB
An obligation rated BBB exhibits adequate protection parameters. However,
adverse economic conditions or changing circumstances are more likely to lead to
a weakened capacity of the obligor to meet its financial commitment on the
obligation.

BB, B, CCC, CC, AND C
Obligations rated BB, B, CCC, CC, and C are regarded as having significant
speculative characteristics. BB indicates the least degree of speculation and C
the highest. While such obligations will likely have some quality and protective
characteristics, these may be outweighed by large uncertainties or major
exposures to adverse conditions.

BB
An obligation rated BB is less vulnerable to nonpayment than other speculative
issues. However, it faces major ongoing uncertainties or exposure to adverse
business, financial, or economic conditions which could lead to the obligor's
inadequate capacity to meet its financial commitment on the obligation.

B
An obligation rated B is more vulnerable to nonpayment than obligations rated
BB, but the obligor currently has the capacity to meet its financial commitment
on the obligation. Adverse business, financial, or economic conditions will
likely impair the obligor's capacity or willingness to meet its financial
commitment on the obligation.

CCC
An obligation rated CCC is currently vulnerable to nonpayment and is dependent
upon favorable business, financial, and economic conditions for the obligor to
meet its financial commitment on the obligation. In the event of adverse
business, financial, or economic conditions, the obligor is not likely to have
the capacity to meet its financial commitment on the obligation.

CC
An obligation rated CC is currently highly vulnerable to nonpayment.

New World Fund -- Page 57
<PAGE>

C
The C rating may be used to cover a situation where a bankruptcy petition has
been filed or similar action has been taken, but payments on this obligation are
being continued.

D
An obligation rated D is in payment default. The D rating category is used when
payments on an obligation are not made on the date due even if the applicable
grace period has not expired, unless Standard & Poor's believes that such
payments will be made during such grace period. The D rating also will be used
upon the filing of a bankruptcy petition or the taking of a similar action if
payments on an obligation are jeopardized.

PLUS (+) OR MINUS (-)
The ratings from AA to CCC may be modified by the addition of a plus or minus
sign to show relative standing within the major rating categories.

New World Fund -- Page 58

[logo - AMERICAN FUNDS (R)]

New World Fund ^SM

Investment portfolio

October 31, 2005

		Market value
Common stocks — 76.21%	Shares	(000)

FINANCIALS — 16.21%
Grupo Financiero Banorte, SA de CV	9,280,000	$ 79,157
Itaúsa - Investimentos Itaú SA, preferred nominative	20,226,642	60,630
EFG International ¹	1,938,000	55,670
Banco Itaú Holding Financeira SA, preferred nominative	2,165,000	51,908
Unibanco-União de Bancos Brasileiros SA, units (GDR)	766,000	40,062
Unibanco-União de Bancos Brasileiros SA, units	1,000,000	10,407
Housing Development Finance Corp. Ltd.	2,207,818	47,446
National Savings and Commercial Bank Ltd. ²	1,291,000	46,626
KASIKORNBANK PCL, nonvoting depositary receipt ²	25,300,000	37,626
KASIKORNBANK PCL ²	2,500,000	3,869
Erste Bank der oesterreichischen Sparkassen AG ²	716,800	37,257
ICICI Bank Ltd. ²	2,865,100	31,812
ICICI Bank Ltd. (ADR)	27,000	639
PT Bank Mandiri (Persero) Tbk ²	220,083,500	28,718
HSBC Holdings PLC ²	1,747,017	27,342
Banco Bradesco SA, preferred nominative	498,000	25,670
Banco Bilbao Vizcaya Argentaria, SA ²	1,400,000	24,697
Siam City Bank PCL, nonvoting depositary receipt ²	41,590,000	23,880
Bank Muscat (SAOG) (GDR) ¹	652,790	16,320
Bank Muscat (SAOG) (GDR) ^1,3	265,900	6,647
Siam Commercial Bank PCL ²	19,130,000	22,179
Banco Latinoamericano de Exportaciones, SA	1,240,000	21,092
National Bank of Pakistan	7,385,000	18,942
Piraeus Bank SA ²	890,000	18,062
Banco Santander Central Hispano, SA ²	1,239,528	15,775
Bank Polska Kasa Opieki SA ²	324,000	15,384
SM Prime Holdings, Inc. ²	98,000,000	14,121
HDFC Bank Ltd. ²	836,800	11,350
PT Bank Rakyat Indonesia ²	46,221,800	11,206
Bank Hapoalim Ltd. ²	2,728,000	10,468
Bank of the Philippine Islands ²	9,710,460	9,225
American International Group, Inc.	140,000	9,072
Daegu Bank, Ltd. ²	725,000	8,660
Citigroup Inc.	175,000	8,012
Bank Zachodni WBK SA ²	200,000	6,739
Kookmin Bank ²	121,000	6,714
Malayan Banking Bhd. ²	1,430,000	4,394
		867,778

TELECOMMUNICATION SERVICES — 10.36%
Perusahaan Perseroan (Persero) PT Telekomunikasi Indonesia Tbk, Class B ²	161,770,000	$ 80,737
Philippine Long Distance Telephone Co. ²	2,129,960	64,971
América Móvil SA de CV, Series L (ADR)	2,178,600	57,188
Telefónica, SA ²	3,358,314	53,495
Partner Communications Co. Ltd. ²	3,481,800	28,589
Partner Communications Co. Ltd. (ADR)	1,735,000	14,123
Tele Norte Leste Participações SA, preferred nominative	2,043,905	35,833
Advanced Info Service PCL ²	13,641,500	33,493
TIM Participações SA, preferred nominative (ADR)	1,448,228	29,356
Maxis Communications Bhd. ²	10,746,400	25,628
Telekom Austria AG ²	1,025,000	21,244
Tele Centro Oeste Celular Participações SA, preferred nominative	1,009,577	8,980
Tele Centro Oeste Celular Participações SA, preferred nominative (ADR)	985,000	8,914
Tele Centro Oeste Celular Participações SA, ordinary nominative	17,540	152
Celular CRT SA, Class A, preferred nominative	660,150	15,267
Celular CRT SA, ordinary nominative	24,114	449
Magyar Távközlési Rt. (ADR)	525,000	12,285
Magyar Távközlési Rt. ²	194,099	920
China Mobile (Hong Kong) Ltd. ²	2,919,800	13,037
China Unicom Ltd. ²	13,991,300	10,743
KT Corp. (ADR)	422,000	9,094
Portugal Telecom, SGPS, SA ²	1,002,900	9,064
Bharti Tele-Ventures Ltd. ^1,2	810,000	5,809
Telenor ASA ²	590,000	5,771
Teléfonos de México, SA de CV, Class L (ADR)	200,000	4,036
GLOBE TELECOM, Inc. ²	223,993	2,880
PT Indosat Tbk (ADR)	111,500	2,687
		554,745

CONSUMER STAPLES — 8.62%
Fomento Económico Mexicano, SA de CV (ADR)	1,182,000	80,364
Nestlé SA ²	187,700	55,819
Pyaterochka Holding NV (GDR) ^1,2,3	2,167,800	42,501
Pyaterochka Holding NV (GDR) ^1,2	50,000	980
Cía. de Bebidas das Américas - AmBev, preferred nominative (ADR)	900,000	31,950
Cía. de Bebidas das Américas - AmBev, ordinary nominative (ADR)	197,000	5,502
Tesco PLC ²	6,185,000	32,895
PepsiCo, Inc.	436,000	25,759
Nestlé India Ltd.	1,051,300	19,702
Avon Products, Inc.	728,000	19,649
China Mengniu Dairy Co. ²	22,483,000	17,701
Wal-Mart de México, SA de CV, Series V (ADR)	340,000	16,609
Coca-Cola Co.	356,700	15,260
Groupe Danone ²	143,800	14,666
Migros Türk TAS ²	1,500,956	13,123
Anheuser-Busch Companies, Inc.	295,000	12,172
Oriflame Cosmetics SA (SDR) ²	402,550	10,406
Unilever NV ²	119,500	8,402
Unilever PLC ²	799,034	8,097
Kimberly-Clark de México, SA de CV, Class A, ordinary participation certificates	2,000,000	6,643
Coca-Cola HBC SA	200,000	5,453
Coca-Cola FEMSA, SA de CV, Series L	2,065,000	5,298
Hindustan Lever Ltd. ²	1,200,000	4,302
L'Oréal SA ²	58,000	4,259
Heineken NV ²	125,000	3,954
		461,466

MATERIALS — 7.75%
Cía. Vale do Rio Doce, preferred nominative, Class A	1,192,000	43,943
Cía. Vale do Rio Doce, ordinary nominative (ADR)	123,000	5,084
INI Steel Co. ²	1,975,000	44,078
Hindalco Industries Ltd. ²	15,490,820	39,440
Aracruz Celulose SA, Class B, preferred nominative (ADR)	888,000	34,010
Votorantim Celulose e Papel SA, preferred nominative (ADR)	2,835,000	33,935
AngloGold Ashanti Ltd. ²	849,785	33,666
Cemex, SA de CV, ordinary participation certificates, units (ADR)	582,365	30,324
Associated Cement Companies Ltd. ²	2,500,000	24,739
Siam Cement PCL ²	4,320,000	24,376
Ivanhoe Mines Ltd. ¹	2,660,000	19,952
Phelps Dodge Corp.	137,000	16,504
Siam City Cement PCL ²	1,874,600	13,159
Hanil Cement Co., Ltd.	181,500	11,793
BHP Billiton PLC ²	682,288	10,019
Holcim Ltd. ²	140,142	8,703
Asian Paints (India) Ltd.	750,000	8,059
Formosa Plastics Corp. ²	3,519,828	5,315
Harmony Gold Mining Co. Ltd. ^1,2	475,000	5,027
Hyosung Corp. ²	237,608	2,756
		414,882

CONSUMER DISCRETIONARY — 6.77%
Toyota Motor Corp. ²	1,058,700	48,413
Maruti Udyog Ltd. ²	3,567,000	43,513
Shangri-La Asia Ltd. ²	26,874,000	37,619
Honda Motor Co., Ltd. ²	614,500	33,562
Kuoni Reisen Holding AG, Class B ¹	85,150	32,019
Grupo Televisa, SA, ordinary participation certificates (ADR)	335,000	24,488
BEC World PCL ²	45,200,000	16,645
Li & Fung Ltd. ²	7,349,000	15,672
Cheng Shin Rubber (Xiamen) Ind., Ltd. ²	21,223,264	15,328
Makita Corp. ²	625,000	14,472
Yue Yuen Industrial (Holdings) Ltd. ²	5,224,000	13,195
Laureate Education, Inc. ¹	265,000	13,091
LG Electronics Inc. ²	178,630	11,702
Central European Media Enterprises Ltd., Class A ¹	238,917	11,107
Cheil Industries Inc. ²	400,000	9,702
Astro All Asia Networks PLC ²	6,088,500	8,871
Koninklijke Philips Electronics NV ²	290,000	7,566
Nien Hsing Textile Co., Ltd. ²	8,600,000	5,296
Antena 3 Televisión, SA ²	5,344	104
		362,365

INDUSTRIALS — 6.30%
Daelim Industrial Co., Ltd. ²	1,003,260	58,359
Wienerberger AG ²	1,199,000	46,354
Thai Airways International PCL ²	50,138,200	45,500
Hyundai Development Co. ²	887,000	32,557
Italian-Thai Development PCL ²	135,416,600	29,304
Bharat Heavy Electricals Ltd.	1,100,000	27,596
Metso Oyj ²	770,000	20,017
Jet Airways (India) Ltd. ²	721,600	16,149
International Container Terminal Services, Inc. ²	88,828,000	15,251
Sandvik AB ²	300,000	$ 14,451
AGCO Corp. ¹	825,000	13,192
Asahi Glass Co., Ltd. ²	1,050,000	11,401
Hi-P International Ltd. ²	4,664,000	3,852
3M Co.	47,000	3,571
		337,554

UTILITIES — 5.73%
CPFL Energia SA (ADR)	2,155,000	67,171
Cia. Energética de Minas Gerais - CEMIG, preferred nominative	1,349,200,000	49,204
NTPC Ltd. ²	15,986,000	34,499
Perusahaan Gas Negara (Persero) Tbk. ²	58,260,000	31,099
Reliance Energy Ltd.	2,711,000	31,043
GAIL (India) Ltd.	4,630,000	24,106
Cheung Kong Infrastructure Holdings Ltd. ²	5,050,000	15,704
Electricity Generating PCL, nonvoting depositary receipt ²	4,774,227	9,050
Electricity Generating PCL	3,635,773	6,218
AES Corp. ¹	700,000	11,123
Tenaga Nasional Bhd. ²	3,550,000	9,405
Gas Natural SDG, SA ²	336,000	9,152
Veolia Environnement ²	220,000	9,150
		306,924

ENERGY— 4.51%
MOL Magyar Olaj- és Gázipari Rt., Class A ²	645,000	59,658
Petróleo Brasileiro SA - Petrobras, ordinary nominative (ADR)	559,000	35,720
Petróleo Brasileiro SA - Petrobras, preferred nominative (ADR)	231,892	13,304
Oil & Natural Gas Corp. Ltd. ²	1,019,533	21,032
FMC Technologies, Inc. ¹	571,700	20,844
Nexen Inc.	480,713	19,779
Banpu PCL ²	4,904,000	16,851
China Shenhua Energy Co. Ltd. ^1,2	11,450,000	12,545
Noble Energy, Inc.	300,000	12,015
Harvest Natural Resources, Inc. ¹	934,000	9,041
Royal Dutch Shell PLC, Class B (ADR)	109,819	7,183
Reliance Industries Ltd. ²	421,000	7,132
China Oilfield Services Ltd., Class H ²	11,298,700	4,150
OAO NOVATEK (GDR) ^1,2,3	93,300	2,084
		241,338

INFORMATION TECHNOLOGY — 3.83%
NHN Corp. ^1,2	287,482	47,600
Kingboard Chemical Holdings Ltd. ²	21,199,400	44,775
Mediatek Incorporation ²	3,517,576	30,703
Hon Hai Precision Industry Co., Ltd. ²	5,641,537	24,451
Samsung Electronics Co., Ltd. ²	43,000	22,812
Venture Corp. Ltd. ²	1,531,800	11,318
NetEase.com, Inc. (ADR) ¹	80,000	6,102
QUALCOMM Inc. ¹	150,000	5,964
SINA Corp. ¹	210,000	5,323
Sohu.com Inc. ¹	180,000	2,725
Samsung SDI Co., Ltd. ²	21,800	2,146
KEC Corp. ²	750,000	1,279
		205,198


HEALTH CARE — 1.51%
Novo Nordisk A/S, Class B ²	483,300	$ 24,750
Gedeon Richter Ltd. ²	89,500	14,684
Ranbaxy Laboratories Ltd.	1,537,142	11,976
Teva Pharmaceutical Industries Ltd. (ADR)	275,000	10,483
AstraZeneca PLC ²	172,700	7,764
Dr. Reddy’s Laboratories Ltd. ²	400,000	7,184
Apollo Hospitals Enterprise Ltd. (GDR) ³	253,800	2,398
Apollo Hospitals Enterprise Ltd. ²	5,500	53
Lumenis Ltd. ¹	820,000	1,640
		80,932

MISCELLANEOUS — 4.62%
Other common stocks in initial period of acquisition		247,276


Total common stocks (cost: $3,056,380,000)		4,080,458


Warrants — 0.01%

INFORMATION TECHNOLOGY — 0.01%
Kingboard Chemical Holdings Ltd., warrants, expire 2006 ¹	1,869,940	494


Total warrants (cost: $0)		494



	Principal amount
Bonds & notes — 10.71%	(000)

NON-U.S. GOVERNMENT BONDS & NOTES — 10.11%
United Mexican States Government Global 8.625% 2008	$ 5,471	5,925
United Mexican States Government Global 4.83% 2009 ⁴	18,750	19,073
United Mexican States Government Global 10.375% 2009	4,500	5,213
United Mexican States Government Global 9.875% 2010	21,625	25,485
United Mexican States Government Global 6.375% 2013	10,000	10,500
United Mexican States Government, Series MI10, 8.00% 2013	MXP67,600	5,952
United Mexican States Government, Series MI10, 9.50% 2014	29,700	2,849
United Mexican States Government Global 11.375% 2016	$12,120	17,544
United Mexican States Government, Series M20, 8.00% 2023	MXP52,700	4,389
Russian Federation 8.25% 2010	$49,400	52,848
Russian Federation 8.25% 2010 ³	5,648	6,042
Russian Federation 5.00% 2030 ^3,4	30,813	34,279
Russian Federation 5.00% 2030 ⁵	3,000	3,337
Brazilian Treasury Bill 0% 2007	R$5	1,949
Brazil (Federal Republic of) Global 5.25% 2009 ⁴	$ 2,817	2,789
Brazil (Federal Republic of) Global 14.50% 2009	4,625	5,901
Brazil (Federal Republic of) Global 9.25% 2010	12,600	13,866
Brazil (Federal Republic of) Global 8.00% 2018	15,045	15,579
Brazil (Federal Republic of) Global 8.875% 2019	4,000	4,230
Brazil (Federal Republic of) Global 10.125% 2027	12,000	13,890
Brazil (Federal Republic of) Global 11.00% 2040	22,025	26,491
Argentina (Republic of) 3.504% 2012 ⁴	18,700	14,514
Argentina (Republic of) 2.192% 2014 ⁶	ARS 10,960	$ 3,305
Argentina (Republic of) 6.501% 2033 ^6,7	111,031	38,879
Argentina (Republic of) 0.72% 2038 ⁶	60,889	8,646
Panama (Republic of) Global 8.25% 2008	$26,050	27,776
Panama (Republic of) Global 9.625% 2011	2,685	3,101
Panama (Republic of) Global 9.375% 2012	6,527	7,637
Panama (Republic of) Global 10.75% 2020	2,255	3,072
Panama (Republic of) Global 9.375% 2023	8,161	9,956
Panama (Republic of) Global 8.875% 2027	100	117
Panama (Republic of) Global 9.375% 2029	6,535	8,022
Peru (Republic of) 9.125% 2012	25,300	29,373
Peru (Republic of) 8.375% 2016	14,250	16,138
Peru (Republic of) Past Due Interest Eurobond 5.00% 2017 ⁴	5,679	5,480
Colombia (Republic of) Global 10.00% 2012	18,725	22,142
Colombia (Republic of) Global 10.75% 2013	9,840	12,005
Columbia (Republic of) Global 8.25% 2014	3,100	3,370
Columbia (Republic of) 8.125% 2024	3,375	3,513
Turkey (Republic of) 20.00% 2007	TRY9,955	8,115
Turkey (Republic of) 15.00% 2010	5,700	4,608
Turkey (Republic of) 11.875% 2030	$8,900	12,949
Philippines (Republic of) 8.875% 2008	4,740	5,084
Philippines (Republic of) 8.375% 2009	8,335	8,846
Philippines (Republic of) Global 10.625% 2025	4,250	4,925
Venezuela (Republic of) 9.25% 2027	1,500	1,751
		541,455

INFORMATION TECHNOLOGY — 0.30%
Amkor Technology, Inc. 10.50% 2009	5,960	5,126
Amkor Technology, Inc. 7.125% 2011	12,340	10,736
		15,862

UTILITIES — 0.15%
Enersis SA 7.375% 2014	4,550	4,803
AES Gener SA 7.50% 2014	3,000	3,003
		7,806

ENERGY — 0.09%
Pemex Project Funding Master Trust 8.00% 2011	2,300	2,577
Petrozuata Finance, Inc., Series B, 8.22% 2017 ^3,8	2,250	2,126
		4,703

INDUSTRIALS — 0.06%
TFM, SA de CV 9.375% 2012 ³	3,200	3,488


Total bonds & notes (cost: $519,864,000)		573,314




Short-term securities — 12.69%

Barclays U.S. Funding LLC 3.835% due 11/28/2005	39,500	39,384
Siemens Capital Co. LLC 3.85%-3.98% due 11/10-12/16/2005	37,100	36,933
IXIS Commercial Paper Corp. 3.80%-3.94% due 11/10-12/13/2005 ³	35,200	35,111
Dexia Delaware LLC 3.84%-3.855% due 11/15-11/28/2005	34,200	34,132
KfW International Finance Inc. 3.92%-4.04% due 12/13-12/27/2005 ³	34,100	33,908
CBA (Delaware) Finance Inc. 3.91%-3.93% due 12/12-12/19/2005	31,600	31,449
BNP Paribas Finance Inc. 3.775%-3.855% due 11/30-12/2/2005	30,500	30,405
Bank of Ireland 3.78% due 11/9-11/14/2005 ³	29,800	29,769
Thunder Bay Funding, LLC 3.78%-3.91% due 11/7-11/22/2005 ³	29,100	29,061
Royal Bank of Scotland PLC 3.63%-3.77% due 11/3-11/8/2005	28,700	28,683
Lloyds Bank PLC 3.78% due 11/4/2005	25,000	24,990
Depfa Bank PLC 3.675% due 11/14/2005 ³	25,000	24,964
HBOS Treasury Services PLC 3.97% due 12/19/2005	25,000	24,867
DaimlerChrysler Revolving Auto Conduit LLC II 3.89% due 11/16/2005	23,500	23,459
Calyon North America Inc. 3.63% due 11/7/2005	22,400	22,384
Edison Asset Securitization LLC 3.65% due 11/7/2005 ³	20,700	20,685
Federal Home Loan Bank 3.675%-3.80% due 11/2-11/18/2005	18,200	18,174
GlaxoSmithKline Finance PLC 3.90% due 12/12/2005	17,900	17,820
Spintab AB (Swedmortgage) 3.72%-3.87% due 11/18/2005	17,800	17,766
Allied Irish Banks N.A. Inc. 3.67% due 11/8/2005 ³	17,200	17,186
Société Générale 3.70% due 11/1/2005	17,000	17,000
Shell International Finance BV 3.94%-4.00% due 12/19-12/20/2005	17,000	16,907
Amsterdam Funding Corp. 3.78% due 11/8/2005 ³	16,600	16,586
Stadshypotek Delaware Inc. 3.68% due 11/14/2005 ³	16,000	15,977
ANZ (Delaware) Inc. 3.63% due 11/7/2005	10,000	9,993
ANZ National (International) Ltd. 3.88% due 12/12/2005 ³	5,900	5,873
Toyota Motor Credit Corp. 3.98% due 12/28/2005 ⁹	13,100	13,019
HSBC USA Inc. 3.67% due 11/1/2005	12,000	11,999
Gaz de France 3.99%-4.00% due 12/12/2005 ³	11,600	11,546
Concentate Manufacturing Co. of Ireland 3.985% due 11/28/2005	10,000	9,969
Total Capital SA 3.88% due 12/8/2005 ³	9,300	9,262


Total short-term securities (cost: $679,250,000)		679,261

Total investment securities (cost: $4,255,494,000)		5,333,527
Other assets less liabilities		20,165

Net assets		$5,353,692

“Miscellaneous” securities include holdings in their initial period of acquisition that have not previously been publicly disclosed.

¹ Security did not produce income during the last 12 months.

² Valued under fair value procedures adopted by authority of the Board of Directors. At October 31, 2005, 126 of the fund’s securities, including

those in “Miscellaneous” (with aggregate value of $2,416,634,000), were fair valued under procedures that took into account significant price

changes that occurred between the close of trading in those securities and the close of regular trading on the New York Stock Exchange.

³ Purchased in a private placement transaction; resale may be limited to qualified institutional buyers; resale to the public may require

registration. The total value of all such restricted securities was $349,493,000, which represented 6.53% of the net assets of the fund.

⁴ Coupon rate may change periodically.

⁵ Step bond; coupon rate will increase at a later date.

⁶ Index-linked bond whose principal amount moves with a government retail price index.

⁷ Payment in kind; the issuer has the option of paying additional securities in lieu of cash.

⁸ Pass-through security backed by a pool of mortgages or other loans on which principal payments are periodically made. Therefore, the effective

maturity is shorter than the stated maturity.

⁹ This security, or a portion of this security, has been segregated to cover funding requirements on investment transactions settling in the future.

ADR = American Depositary Receipts

GDR = Global Depositary Receipts

SDR = Swedish Depositary Receipts

See Notes to Financial Statements

Financial statements

Statement of assets and liabilities
at October 31, 2005 (dollars and shares in thousands, except per-share amounts)

Assets:
Investment securities at market (cost: $4,255,494)			$	5,333,527
Cash denominated in non-U.S. currencies
(cost: $564)				554
Cash				2,092
Receivables for:
Sales of investments	$	14,795
Sales of fund's shares		30,616
Dividends and interest		13,691		59,102
				5,395,275
Liabilities:
Payables for:
Purchases of investments		31,743
Repurchases of fund's shares		2,561
Investment advisory services		2,683
Services provided by affiliates		2,303
Deferred Directors' compensation		953
Other fees and expenses		1,340		41,583
Net assets at October 31, 2005			$	5,353,692

Net assets consist of:
Capital paid in on shares of capital stock			$	4,244,754
Undistributed net investment income				54,426
Accumulated net realized loss				(22,539	)
Net unrealized appreciation				1,077,051
Net assets at October 31, 2005			$	5,353,692

Total authorized capital stock - 200,000 shares, $.01 par value (147,758 total shares outstanding)

	Net assets		Shares outstanding		Net asset value per share (1)

Class A	$	4,194,702		115,502	$	36.32
Class B		170,020		4,761		35.71
Class C		245,815		6,939		35.42
Class F		335,491		9,285		36.13
Class 529-A		75,499		2,086		36.19
Class 529-B		11,058		311		35.58
Class 529-C		19,659		552		35.60
Class 529-E		4,030		112		36.00
Class 529-F		3,933		109		36.15
Class R-1		3,362		94		35.64
Class R-2		47,469		1,333		35.62
Class R-3		40,924		1,135		36.07
Class R-4		14,240		392		36.33
Class R-5		187,490		5,147		36.43

(1) Maximum offering price and redemption price per share were equal to the net asset value per share for all share classes, except for classes A and 529-A, for which the maximum offering prices per share were $38.54 and $38.40, respectively.

See Notes to Financial Statements

Statement of operations for the year ended October 31, 2005		(dollars in thousands)

Investment income:
Income:
Dividends (net of non-U.S. withholding tax of $9,616)	$	77,256
Interest		48,326		$	125,582

Fees and expenses:(1)
Investment advisory services		27,569
Distribution services		12,601
Transfer agent services		3,934
Administrative services		1,382
Reports to shareholders		453
Registration statement and prospectus		417
Postage, stationery and supplies		522
Directors' compensation		451
Auditing and legal		153
Custodian		2,374
State and local taxes		68
Other		126
Total fees and expenses before reimbursements/waivers		50,050
Less reimbursement/waiver of fees and expenses:
Investment advisory services		2,274
Administrative services		110
Total fees and expenses after reimbursements/waivers					47,666
Net investment income					77,916

Net realized gain and change in unrealized appreciation
on investments and non-U.S. currency:
Net realized gain (loss) on:
Investments		165,849
Non-U.S. currency transactions		(1,548	)		164,301
Net change in unrealized appreciation on:
Investments		553,027
Non-U.S. currency translations		75			553,102
Net realized gain and change in unrealized appreciation
on investments and non-U.S. currency					717,403
Net increase in net assets resulting
from operations				$	795,319

(1) Additional information related to class-specific fees and expenses is included in the Notes to Financial Statements.

See Notes to Financial Statements





Statements of changes in net assets		(dollars in thousands )


		Year ended October 31
		2005			2004
Operations:
Net investment income	$	77,916		$	37,346
Net realized gain on investments and
non-U.S. currency transactions		164,301			103,824
Net change in unrealized appreciation on investment and
non-U.S. currency translations		553,102			223,009
Net increase in net assets resulting
from operations		795,319			364,179

Dividends paid to shareholders from net investment income		(52,051	)		(42,150	)
and non U.S. currency gains

Capital share transactions		1,877,407			641,208

Total increase in net assets		2,620,675			963,237

Net assets:
Beginning of year		2,733,017			1,769,780
End of year (including undistributed net investment
income: $54,426 and $10,894, respectively)	$	5,353,692		$	2,733,017




See Notes to Financial Statements

Notes to financial statements

1.	Organization and significant accounting policies

Organization - New World Fund, Inc. (the "fund") is registered under the Investment Company Act of 1940 as an open-end, diversified management investment company. The fund seeks long-term growth of capital by investing in stocks and bonds with significant exposure to countries that have developing economies and/or markets.

The fund offers 14 share classes consisting of four retail share classes, five CollegeAmerica ^Ò savings plan share classes and five retirement plan share classes. The CollegeAmerica savings plan share classes (529-A, 529-B, 529-C, 529-E and 529-F) can be utilized to save for college education. The five retirement plan share classes (R-1, R-2, R-3, R-4 and R-5) are sold without any sales charges and do not carry any conversion rights. The fund’s share classes are described below:

Share class	Initial sales charge	Contingent deferred sales charge upon redemption	Conversion feature
Classes A and 529-A	Up to 5.75%	None (except 1% for certain redemptions within one year of purchase without an initial sales charge)	None
Classes B and 529-B	None	Declines from 5% to 0% for redemptions within six years of purchase	Classes B and 529-B convert to classes A and 529-A, respectively, after eight years
Class C	None	1% for redemptions within one year of purchase	Class C converts to Class F after 10 years
Class 529-C	None	1% for redemptions within one year of purchase	None
Class 529-E	None	None	None
Classes F and 529-F	None	None	None
Classes R-1, R-2, R-3, R-4 and R-5	None	None	None

Holders of all share classes have equal pro rata rights to assets, dividends and liquidation proceeds. Each share class has identical voting rights, except for the exclusive right to vote on matters affecting only its class. Share classes have different fees and expenses ("class-specific fees and expenses"), primarily due to different arrangements for distribution, administrative and shareholder services. Differences in class-specific fees and expenses will result in differences in net investment income and, therefore, the payment of different per-share dividends by each class.

Significant accounting policies - The financial statements have been prepared to comply with accounting principles generally accepted in the United States of America. These principles require management to make estimates and assumptions that affect reported amounts and disclosures. Actual results could differ from those estimates. The following is a summary of the significant accounting policies followed by the fund:

Security valuation - Equity securities are valued at the official closing price of, or the last reported sale price on, the exchange or market on which such securities are traded, as of the close of business on the day the securities are being valued or, lacking any sales, at the last available bid price. Prices for each security are taken from the principal exchange or market in which the security trades. Fixed-income securities, including short-term securities purchased with more than 60 days left to maturity, are valued at prices obtained from an independent pricing service when such prices are available. However, where the investment adviser deems it appropriate, such securities will be valued at the mean quoted bid and asked prices (or bid prices, if asked prices are not available) or at prices for securities of comparable maturity, quality and type. Securities with both fixed-income and equity characteristics, or equity securities traded principally among fixed-income dealers, are valued in the manner described above for either equity or fixed-income securities, depending on which method is deemed most appropriate by the investment adviser. Short-term securities purchased within 60 days to maturity are valued at amortized cost, which approximates market value. The value of short-term securities originally purchased with maturities greater than 60 days is determined based on an amortized value to par when they reach 60 days or less remaining to maturity. The ability of the issuers of the debt securities held by the fund to meet their obligations may be affected by economic developments in a specific industry, state or region. Securities and other assets for which representative market quotations are not readily available are fair valued as determined in good faith under procedures adopted by authority of the fund's Board of Directors. Various factors may be reviewed in order to make a good faith determination of a security’s fair value. These factors include, but are not limited to, the type and cost of the security; contractual or legal restrictions on resale of the security; relevant financial or business developments of the issuer; actively traded similar or related securities; conversion or exchange rights on the security; related corporate actions; and changes in overall market conditions. If events occur that materially affect the value of securities (particularly non-U.S. securities) between the close of trading in those securities and the close of regular trading on the New York Stock Exchange, the securities are fair valued.

Security transactions and related investment income - Security transactions are recorded by the fund as of the date the trades are executed with brokers. Realized gains and losses from security transactions are determined based on the specific identified cost of the securities. In the event a security is purchased with a delayed payment date, the fund will segregate liquid assets sufficient to meet its payment obligations. Dividend income is recognized on the ex-dividend date and interest income is recognized on an accrual basis. Market discounts, premiums and original issue discounts on fixed-income securities are amortized daily over the expected life of the security.

Class allocations - Income, fees and expenses (other than class-specific fees and expenses) and realized and unrealized gains and losses are allocated daily among the various share classes based on their relative net assets. Class-specific fees and expenses, such as distribution, administrative and shareholder services, are charged directly to the respective share class.

Dividends and distributions to shareholders - Dividends and distributions paid to shareholders are recorded on the ex-dividend date.

Non-U.S. currency translation - Assets and liabilities, including investment securities, denominated in non-U.S. currencies are translated into U.S. dollars at the exchange rates in effect on the valuation date. Purchases and sales of investment securities and income and expenses are translated into U.S. dollars at the exchange rates on the dates of such transactions. In the accompanying financial statements, the effects of changes in non-U.S. exchange rates on investment securities are included with the net realized gain or loss and net unrealized appreciation or depreciation on investments. The realized gain or loss and unrealized appreciation or depreciation resulting from all other transactions denominated in non-U.S. currencies are disclosed separately.

Forward currency contracts - The fund may enter into forward currency contracts, which represent agreements to exchange non-U.S. currencies on specific future dates at predetermined rates. The fund enters into these contracts to manage its exposure to changes in non-U.S. exchange rates arising from investments denominated in non-U.S. currencies. Upon entering into these contracts, risks may arise from the potential inability of counterparties to meet the terms of their contracts and from possible movements in non-U.S. exchange rates. Due to these risks, the fund could incur losses up to the entire contract amount, which may exceed the net unrealized value shown in the accompanying financial statements. On a daily basis, the fund values forward currency contracts based on the applicable exchange rates and records unrealized gains or losses. The fund records realized gains or losses at the time the forward contract is closed or offset by another contract with the same broker for the same settlement date and currency.

2.	Non-U.S. investments

Investment risk - The risks of investing in securities of non-U.S. issuers may include, but are not limited to, investment and repatriation restrictions; revaluation of currencies; adverse political, social and economic developments; government involvement in the private sector; limited and less reliable investor information; lack of liquidity; certain local tax law considerations; and limited regulation of the securities markets.

Taxation - Dividend and interest income is recorded net of non-U.S. withholding taxes paid. Gains realized by the fund on the sale of securities in certain countries are subject to non-U.S. taxes. The fund records a liability based on unrealized gains to provide for potential non-U.S. taxes payable upon the sale of these securities. For the year ended October 31, 2005, non-U.S. withholding taxes paid on realized gains were $1,173,000. As of October 31, 2005, non-U.S. taxes provided on unrealized gains were $1,082,000.

3. Federal income taxation and distributions

The fund complies with the requirements under Subchapter M of the Internal Revenue Code applicable to mutual funds and intends to distribute substantially all of its net taxable income and net capital gains each year. The fund is not subject to income taxes to the extent such distributions are made.

Distributions - Distributions paid to shareholders are based on net investment income and net realized gains determined on a tax basis, which may differ from net investment income and net realized gains for financial reporting purposes. These differences are due primarily to differing treatment for items such as non-U.S. currency gains and losses; short-term capital gains and losses; unrealized appreciation of certain investments in non-U.S. securities; deferred expenses; cost of investments sold; paydowns on investments; net capital losses; and interest from defaulted securities. The fiscal year in which amounts are distributed may differ from the year in which the net investment income and net realized gains are recorded by the fund for financial reporting purposes. As of October 31, 2005, the cost of investment securities for federal income tax purposes was $4,290,535,000.

During the year ended October 31, 2005, the fund reclassified $17,692,000 to undistributed net investment income from undistributed net realized gains and $25,000 from undistributed net investment income to capital paid in on shares of capital stock to align financial reporting with tax reporting.

As of October 31, 2005, the components of distributable earnings on a tax basis were as follows (dollars in thousands):


Undistributed net investment income and non-U.S. currency gains	$90,373
Short-term capital loss deferrals	(22,491)
Gross unrealized appreciation on investment securities	1,157,804
Gross unrealized depreciation on investment securities	(114,812)
Net unrealized appreciation on investment securities	1,042,992

Short-term capital loss deferrals above include a capital loss carryforward of $22,491,000 expiring in 2011. During the year ended October 31, 2005, the fund realized, on a tax basis, a net capital gain of $146,594,000, which was offset by the utilization of capital loss carryforwards. The remaining capital loss carryforward will be used to offset any capital gains realized by the fund in future years through the expiration date. The fund will not make distributions from capital gains while a capital loss carryforward remains.

Ordinary income distributions paid to shareholders from net investment income were as follows (dollars in thousands):

Share class	Year ended October 31, 2005		Year ended October 31, 2004
Class A	$	42,710	$	36,096
Class B		1,140		1,014
Class C		1,414		945
Class F		3,321		2,050
Class 529-A		615		338
Class 529- B		67		49
Class 529-C		101		81
Class 529-E		28		17
Class 529-F		43		25
Class R-1		24		7
Class R-2		259		139
Class R-3		292		148
Class R-4		79		34
Class R-5		1,958		1,207
Total	$	52,051	$	42,150

4. Fees and transactions with related parties

Capital Research and Management Company ("CRMC"), the fund’s investment adviser, is the parent company of American Funds Service Company ("AFS"), the fund’s transfer agent, and American Funds Distributors, Inc. ("AFD"), the principal underwriter of the fund’s shares.

Investment advisory services - The Investment Advisory and Service Agreement with CRMC provides for monthly fees accrued daily. At the beginning of the year, these fees were based on a declining series of annual rates beginning with 0.850% on the first $500 million of daily net assets and decreasing to 0.620% on such assets in excess of $2.5 billion. The Board of Directors approved an amended agreement effective March 10, 2005, continuing the series of rates to include additional annual rates of 0.580% on daily net assets in excess of $4 billion but not exceeding $6.5 billion and 0.540% on such assets in excess of $6.5 billion. At the beginning of the year, CRMC waived 5% of these fees and increased the waiver to 10% on April 1, 2005. During the year ended October 31, 2005, total investment advisory services fees waived by CRMC were $2,274,000. As a result, the fee shown on the accompanying financial statements of $27,569,000, which was equivalent to an annualized rate of 0.685%, was reduced to $25,295,000, or 0.629% of average daily net assets.

Class-specific fees and expenses - Expenses that are specific to individual share classes are accrued directly to the respective share class. The principal class-specific fees and expenses are described below:

Distribution services - The fund has adopted plans of distribution for all share classes, except Class R-5. Under the plans, the Board of Directors approves certain categories of expenses that are used to finance activities primarily intended to sell fund shares and service existing accounts. The plans provide for payments, based on an annualized percentage of average daily net assets, ranging from 0.30% to 1.00% as noted <below/on the following page>. In some cases, the Board of Directors has limited the amounts that may be paid to less than the maximum allowed by the plans. All share classes may use up to 0.25% of average daily net assets to pay service fees, or to compensate AFD for paying service fees, to firms that have entered into agreements with AFD for providing certain shareholder services. The remaining amounts available to be paid under each plan are paid to selling dealers to compensate them for their selling activities.

For classes A and 529-A, the Board of Directors has also approved the reimbursement of dealer and wholesaler commissions paid by AFD for certain shares sold without a sales charge. These classes reimburse AFD for amounts billed within the prior 15 months but only to the extent that the overall annual expense limit of 0.30% is not exceeded. As of October 31, 2005, there were no unreimbursed expenses subject to reimbursement for classes A or 529-A.

Share class	Currently approved limits	Plan limits
Class A	0.30%	0.30%
Class 529-A	0.30	0.50
Classes B and 529-B	1.00	1.00
Classes C, 529-C and R-1	1.00	1.00
Class R-2	0.75	1.00
Classes 529-E and R-3	0.50	0.75
Classes F, 529-F and R-4	0.25	0.50

Transfer agent services - The fund has a transfer agent agreement with AFS for classes A and B. Under this agreement, these share classes compensate AFS for transfer agent services including shareholder recordkeeping, communications and transaction processing. AFS is also compensated for certain transfer agent services provided to all other share classes from the administrative services fees paid to CRMC described below.

Administrative services - The fund has an administrative services agreement with CRMC to provide transfer agent and other related shareholder services for all share classes other than classes A and B. Each relevant share class pays CRMC annual fees up to 0.15% (0.10% for Class R-5) based on its respective average daily net assets. Each relevant share class also pays AFS additional amounts for certain transfer agent services. CRMC and AFS may use these fees to compensate third parties for performing these services. CRMC has agreed to pay AFS on the fund's behalf for a portion of the transfer agent services fees for some of the retirement plan share classes. For the year ended October 31, 2005, the total administrative services fees paid by CRMC were $2,000, $100,000 and $8,000 for classes R-1, R-2 and R-3, respectively. Administrative services fees are presented gross of any payments made by CRMC. Each 529 share class is subject to an additional annual administrative services fee of 0.10% of its respective average daily net assets; this fee is payable to the Commonwealth of Virginia for the maintenance of the CollegeAmerica plan. Although these amounts are included with administrative services fees on the accompanying financial statements, the Commonwealth of Virginia is not considered a related party.

Expenses under the agreements described [above/on the previous page] for the year ended October 31, 2005, were as follows (dollars in thousands):

Share class	Distribution services	Transfer agent services	Administrative services
Share class	Distribution services	Transfer agent services	CRMC administrative services	Transfer agent services	Commonwealth of Virginia administrative services
Class A	$8,243	$3,753	Not applicable	Not applicable	Not applicable
Class B	1,288	181	Not applicable	Not applicable	Not applicable
Class C	1,691	Included in administrative services	$254	$54	Not applicable
Class F	622		313	65	Not applicable
Class 529-A	87		67	10	$52
Class 529-B	82		11	5	8
Class 529-C	138		18	7	14
Class 529-E	14		4	1	3
Class 529-F	4		4	1	3
Class R-1	24		3	3	Not applicable
Class R-2	236		47	185	Not applicable
Class R-3	152		45	49	Not applicable
Class R-4	20		12	2	Not applicable
Class R-5	Not applicable		138	4	Not applicable
Total	$12,601	$3,934	$916	$386	$80

Deferred Directors’ compensation - Since the adoption of the deferred compensation plan in 1999, Directors who are unaffiliated with CRMC may elect to defer the cash payment of part or all of their compensation. These deferred amounts, which remain as liabilities of the fund, are treated as if invested in shares of the fund or other American Funds. These amounts represent general, unsecured liabilities of the fund and vary according to the total returns of the selected funds. Directors’ compensation of $451,000, shown on the accompanying financial statements, includes $254,000 in current fees (either paid in cash or deferred) and a net increase of $197,000 in the value of the deferred amounts.

Affiliated officers and Directors - Officers and certain Directors of the fund are or may be considered to be affiliated with CRMC, AFS and AFD. No affiliated officers or Directors received any compensation directly from the fund.

5. Capital share transactions

Capital share transactions in the fund were as follows (dollars and shares in thousands):

Share class	Sales(1)		Reinvestments of dividends and distributions		Repurchases(1)		Net increase
	Amount	Shares	Amount	Shares	Amount	Shares	Amount	Shares
Year ended October 31, 2005
Class A	$1,725,369	50,781	$ 40,564	1,293	$ (375,444)	(11,102)	$1,390,489	40,972
Class B	71,650	2,138	1,100	35	(15,270)	(458)	57,480	1,715
Class C	141,506	4,264	1,352	44	(22,546)	(685)	120,312	3,623
Class F	179,769	5,348	2,907	94	(54,524)	(1,644)	128,152	3,798
Class 529-A	36,812	1,091	615	20	(2,124)	(63)	35,303	1,048
Class 529-B	4,262	128	67	2	(200)	(6)	4,129	124
Class 529-C	9,846	297	101	3	(848)	(26)	9,099	274
Class 529-E	1,949	58	28	1	(107)	(3)	1,870	56
Class 529-F	1,318	40	43	1	(279)	(8)	1,082	33
Class R-1	2,530	75	24	1	(1,325)	(39)	1,229	37
Class R-2	32,939	988	258	8	(8,685)	(260)	24,512	736
Class R-3	30,144	898	290	9	(11,345)	(323)	19,089	584
Class R-4	11,245	331	79	3	(1,791)	(53)	9,533	281
Class R-5	83,844	2,476	1,837	59	(10,553)	(313)	75,128	2,222
Total net increase
(decrease)	$2,333,183	68,913	$ 49,265	1,573	$ (505,041)	(14,983)	$1,877,407	55,503

Year ended October 31, 2004
Class A	$ 625,724	22,400	$ 34,242	1,300	$ (246,193)	(8,873)	$ 413,773	14,827
Class B	37,650	1,366	985	38	(11,205)	(408)	27,430	996
Class C	58,556	2,139	905	35	(11,002)	(406)	48,459	1,768
Class F	105,482	3,817	1,807	69	(32,794)	(1,192)	74,495	2,694
Class 529-A	15,766	568	338	13	(1,171)	(42)	14,933	539
Class 529-B	2,319	85	49	2	(83)	(3)	2,285	84
Class 529-C	3,863	141	81	3	(592)	(22)	3,352	122
Class 529-E	796	29	17	1	(35)	(2)	778	28
Class 529-F	1,198	43	25	1	(89)	(3)	1,134	41
Class R-1	1,889	68	7	-*	(707)	(26)	1,189	42
Class R-2	12,563	455	136	5	(2,803)	(102)	9,896	358
Class R-3	11,921	424	146	5	(3,154)	(114)	8,913	315
Class R-4	2,965	108	34	1	(600)	(22)	2,399	87
Class R-5	38,583	1,380	1,171	44	(7,582)	(275)	32,172	1,149
Total net increase
(decrease)	$ 919,275	33,023	$ 39,943	1,517	$ (318,010)	(11,490)	$ 641,208	23,050

* Amount less than one thousand.

(1) Includes exchanges between share classes of the fund.

6. Investment transactions

The fund made purchases and sales of investment securities, excluding short-term securities, of $2,322,605,000 and $911,679,000, respectively, during the year ended October 31, 2005.

CollegeAmerica is a registered trademark of and sponsored by the Virginia College Savings Plan. ^SM

Financial highlights (1)

		Income (loss) from investment operations(2)
	Net asset value, beginning of period	Net investment income		Net gains (losses) on securities (both realized and unrealized)	Total from investment operations	Dividends (from net investment income)	Net asset value, end of period	Total return (3)	Net assets, end of period (in millions)		Ration of expenses to average net assets before reimbursements/waivers		Ration of expenses to average net assets after reimbursements/waivers		Ratio of net income to average net assets
Class A:
Year ended 10/31/2005	$29.68	$.68		$6.51	$7.19	$(.55)	$36.32	24.50%	$4,195		1.18%		1.12%		2.00%
Year ended 10/31/2004	25.60	.47		4.20	4.67	(.59)	29.68	18.51	2,212		1.23		1.22		1.68
Year ended 10/31/2003	18.90	.39		6.56	6.95	(.25)	25.60	37.19	1,528		1.31		1.31		1.86
Year ended 10/31/2002	19.04	.34		.07	.41	(.55)	18.90	1.95	1,071		1.34		1.34		1.65
Year ended 10/31/2001	22.81	.47		(3.87)	(3.40)	(.37)	19.04	(15.13)	1,053		1.29		1.29		2.15
Class B:
Year ended 10/31/2005	29.23	.42		6.42	6.84	(.36)	35.71	23.57	170		1.94		1.88		1.24
Year ended 10/31/2004	25.29	.25		4.14	4.39	(.45)	29.23	17.58	89		2.01		2.00		.91
Year ended 10/31/2003	18.69	.22		6.50	6.72	(.12)	25.29	36.12	52		2.10		2.10		1.05
Year ended 10/31/2002	18.82	.16		.09	.25	(.38)	18.69	1.17	29		2.15		2.15		.78
Year ended 10/31/2001	22.71	.28		(3.85)	(3.57)	(.32)	18.82	(15.91)	20		2.13		2.13		1.32
Class C:
Year ended 10/31/2005	29.03	.40		6.37	6.77	(.38)	35.42	23.52	246		1.98		1.92		1.21
Year ended 10/31/2004	25.18	.24		4.11	4.35	(.50)	29.03	17.53	96		2.04		2.03		.89
Year ended 10/31/2003	18.66	.21		6.48	6.69	(.17)	25.18	36.10	39		2.12		2.12		.99
Year ended 10/31/2002	18.76	.12		.12	.24	(.34)	18.66	1.15	13		2.14		2.14		.61
Period from 3/15/2001 to 10/31/2001	21.44	.09		(2.77)	(2.68)	-	18.76	(12.50)	3		2.19	(5)	2.19	(5)	.69	(5)
Class F:
Year ended 10/31/2005	29.54	.67		6.47	7.14	(.55)	36.13	24.46	336		1.19		1.14		1.98
Year ended 10/31/2004	25.52	.46		4.17	4.63	(.61)	29.54	18.44	162		1.27		1.26		1.65
Year ended 10/31/2003	18.88	.38		6.54	6.92	(.28)	25.52	37.10	71		1.35		1.35		1.77
Year ended 10/31/2002	18.98	.28		.12	.40	(.50)	18.88	1.95	23		1.38		1.38		1.35
Period from 3/16/2001 to 10/31/2001	21.42	.21		(2.65)	(2.44)	-	18.98	(11.39)	3		1.40	(5)	1.40	(5)	1.62	(5)
Class 529-A:
Year ended 10/31/2005	29.59	.67		6.48	7.15	(.55)	36.19	24.45	76		1.21		1.15		1.97
Year ended 10/31/2004	25.56	.46		4.18	4.64	(.61)	29.59	18.43	31		1.27		1.26		1.65
Year ended 10/31/2003	18.89	.40		6.54	6.94	(.27)	25.56	37.18	13		1.30		1.30		1.87
Period from 2/19/2002 to 10/31/2002	21.19	.14		(2.44)	(2.30)	-	18.89	(10.85)	5		1.47	(5)	1.47	(5)	.99	(5)
Class 529-B:
Year ended 10/31/2005	29.15	.36		6.41	6.77	(.34)	35.58	23.38	11		2.09		2.04		1.09
Year ended 10/31/2004	25.25	.20		4.14	4.34	(.44)	29.15	17.41	6		2.17		2.17		.74
Year ended 10/31/2003	18.79	.19		6.48	6.67	(.21)	25.25	35.86	3		2.27		2.27		.89
Period from 2/26/2002 to 10/31/2002	21.20	.02		(2.43)	(2.41)	-	18.79	(11.37)	1		2.25	(5)	2.25	(5)	.14	(5)
Class 529-C:
Year ended 10/31/2005	29.17	.37		6.40	6.77	(.34)	35.60	23.38	20		2.08		2.02		1.11
Year ended 10/31/2004	25.28	.21		4.14	4.35	(.46)	29.17	17.43	8		2.16		2.15		.76
Year ended 10/31/2003	18.79	.19		6.50	6.69	(.20)	25.28	35.90	4		2.24		2.24		.90
Period from 2/25/2002 to 10/31/2002	21.15	.04		(2.40)	(2.36)	-	18.79	(11.16)	1		2.21	(5)	2.21	(5)	.26	(5)
Class 529-E:
Year ended 10/31/2005	29.46	.56		6.45	7.01	(.47)	36.00	24.02	4		1.55		1.49		1.65
Year ended 10/31/2004	25.46	.36		4.18	4.54	(.54)	29.46	18.07	2		1.62		1.61		1.31
Year ended 10/31/2003	18.86	.31		6.53	6.84	(.24)	25.46	36.64	1		1.69		1.69		1.47
Period from 3/22/2002 to 10/31/2002	22.57	.10		(3.81)	(3.71)	-	18.86	(16.44)	-	(6)	1.66	(5)	1.66	(5)	.78	(5)
Class 529-F:
Year ended 10/31/2005	29.53	.68		6.47	7.15	(.53)	36.15	24.49	4		1.17		1.11		2.02
Year ended 10/31/2004	25.54	.43		4.18	4.61	(.62)	29.53	18.33	2		1.37		1.36		1.54
Year ended 10/31/2003	18.90	.39		6.52	6.91	(.27)	25.54	37.01	1		1.43		1.43		1.74
Period from 9/17/2002 to 10/31/2002	19.44	-	(7)	(.54)	(.54)	-	18.90	(2.78)	-	(6)	.17		.17		-	(8)
Class R-1:
Year ended 10/31/2005	$29.22	$.40		$6.41	$6.81	$(.39)	$35.64	23.51%	$3		2.06%		1.92%		1.19%
Year ended 10/31/2004	25.33	.25		4.14	4.39	(.50)	29.22	17.57	2		2.16		2.04		.92
Year ended 10/31/2003	18.85	.23		6.50	6.73	(.25)	25.33	36.07	-	(6)	2.84		2.10		1.05
Period from 6/11/2002 to 10/31/2002	22.44	.01		(3.60)	(3.59)	-	18.85	(16.00)	-	(6)	3.49		.81		.06
Class R-2:
Year ended 10/31/2005	29.21	.41		6.40	6.81	(.40)	35.62	23.53	47		2.27		1.89		1.23
Year ended 10/31/2004	25.34	.25		4.14	4.39	(.52)	29.21	17.58	17		2.57		2.00		.91
Year ended 10/31/2003	18.86	.22		6.51	6.73	(.25)	25.34	36.09	6		2.69		2.06		.98
Period from 6/7/2002 to 10/31/2002	22.37	(.02)		(3.49)	(3.51)	-	18.86	(15.69)	1		1.04		.83		(.11)
Class R-3:
Year ended 10/31/2005	29.53	.55		6.47	7.02	(.48)	36.07	24.02	41		1.60		1.51		1.62
Year ended 10/31/2004	25.56	.36		4.18	4.54	(.57)	29.53	18.03	16		1.70		1.62		1.30
Year ended 10/31/2003	18.96	.30		6.56	6.86	(.26)	25.56	36.63	6		1.84		1.68		1.37
Period from 6/6/2002 to 10/31/2002	22.41	.03		(3.48)	(3.45)	-	18.96	(15.39)	1		.77		.68		.13
Class R-4:
Year ended 10/31/2005	29.72	.68		6.49	7.17	(.56)	36.33	24.44	14		1.21		1.15		1.98
Year ended 10/31/2004	25.68	.47		4.20	4.67	(.63)	29.72	18.48	3		1.29		1.27		1.66
Year ended 10/31/2003	18.90	.39		6.57	6.96	(.18)	25.68	37.14	1		1.43		1.33		1.79
Period from 10/7/2002 to 10/31/2002	18.21	-	(7)	.69	.69	-	18.90	3.79	-	(6)	.13		.09		-	(8)
Class R-5:
Year ended 10/31/2005	29.76	.78		6.51	7.29	(.62)	36.43	24.83	187		.89		.84		2.28
Year ended 10/31/2004	25.66	.55		4.20	4.75	(.65)	29.76	18.83	87		.95		.94		1.96
Year ended 10/31/2003	18.93	.46		6.57	7.03	(.30)	25.66	37.60	45		1.01		1.01		2.15
Period from 5/15/2002 to 10/31/2002	23.05	.12		(4.24)	(4.12)	-	18.93	(17.87)	27		.46		.46		.62

	Year ended October 31
		2005	2004	2003	2002	2001

Portfolio turnover rate for all classes of shares		26%	20%	30%	32%	40%

(1) Based on operations for the period shown (unless otherwise noted) and, accordingly, may not be representative of a full year.

(2) Based on average shares outstanding.

(3) Total returns exclude all sales charges, including contingent deferred sales charges.

(4) The ratios in this column reflect the impact, if any, of certain reimbursements/waivers from CRMC.

During some of the periods shown, CRMC reduced fees for investment advisory services for all share classes.

In addition, during the start-up period for the retirement plan share classes (except Class R-5),

CRMC agreed to pay a portion of the fees related to transfer agent services.

(5) Annualized.

(6) Amount less than $1 million.

(7) Amount less than one cent.

(8) Amount less than .01 percent.

See Notes to Financial Statements

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of New World Fund Inc.:

We have audited the accompanying statement of assets and liabilities of New World Fund, Inc. (the “Fund”), including the investment portfolio, as of October 31, 2005, and the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the periods presented. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of October 31, 2005, by correspondence with the custodian and brokers; where replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of New World Fund, Inc. as of October 31, 2005, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the periods presented, in conformity with accounting principles generally accepted in the United States of America.

DELOITTE & TOUCHE LLP

Costa Mesa, California

December 14, 2005

Tax information unaudited

We are required to advise you within 60 days of the fund’s fiscal year-end regarding the federal tax status of certain distributions received by shareholders during such fiscal year. The information below is provided for the fund’s fiscal year ended October 31, 2005.

The amount of foreign taxes passed through to shareholders for the fiscal year was $9,983,000. Foreign source income earned by the fund for the fiscal year was $129,627,000.

Individual shareholders are eligible for reduced tax rates on qualified dividend income. The fund designates $73,460,000 of the dividends received as qualified dividend income.

Corporate shareholders may exclude up to 70% of qualifying dividends. The fund designates $2,274,000 of dividends received as qualified dividend income.

For state tax purposes, certain states may exempt from income taxation that portion of the income dividends paid by the fund that were derived from direct U.S. government obligations. The fund designates $390,000 as interest derived on direct U.S. government obligations.

Individual shareholders should refer to their Form 1099-DIV or other tax information, which will be mailed in January 2006, to determine the calendar year amounts to be included on their 2005 tax returns. Shareholders should consult their tax advisers .

<PAGE>



[logo - American Funds /(R)/]              The right choice for the long term/(R)/




New World Fund/SM/




 RETIREMENT PLAN
 PROSPECTUS




 January 1, 2006











TABLE OF CONTENTS

 1    Risk/Return summary
 4    Fees and expenses of the fund
 6    Investment objective, strategies and risks
10    Management and organization
13    Purchase, exchange and sale of shares
16    Sales charges
18    Sales charge reductions
19    Rollovers from retirement plans to IRAs
20    Plans of distribution
20    Other compensation to dealers
21    Distributions and taxes
22    Financial highlights





 THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED OF
 THESE SECURITIES. FURTHER, IT HAS NOT DETERMINED THAT THIS PROSPECTUS IS
 ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
 OFFENSE.



<PAGE>

 [This page intentionally left blank for this filing.]

<PAGE>

Risk/Return summary

The fund seeks to make your investment grow over time by investing primarily in
stocks of companies with significant exposure to countries with developing
economies and/or markets. The fund may also invest in debt securities of
issuers, including issuers of lower rated bonds, with exposure to these
countries.
The fund is designed for investors seeking capital appreciation.  Investors in
the fund should have a long-term perspective and be able to tolerate potentially
wide price fluctuations. Your investment in the fund is subject to risks,
including the possibility that the value of the fund's portfolio holdings may
fluctuate in response to events specific to the companies in which the fund
invests, as well as economic, political or social events in the United States or
abroad. The values of debt securities owned by the fund may be affected by
changing interest rates and credit risk assessments. Lower quality or longer
maturity bonds may be subject to greater price fluctuations than higher quality
or shorter maturity bonds.

Although all securities in the fund's portfolio may be adversely affected by
currency fluctuations or global economic, political or social instability,
securities issued by entities based outside the United States, particularly in
countries with developing economies and/or markets, may be affected to a greater
extent.

Your investment in the fund is not a bank deposit and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency, entity or person.
YOU MAY LOSE MONEY BY INVESTING IN THE FUND. THE LIKELIHOOD OF LOSS MAY BE
GREATER IF YOU INVEST FOR A SHORTER PERIOD OF TIME.


                                       1

                                                    New World Fund / Prospectus
<PAGE>




HISTORICAL INVESTMENT RESULTS
The bar chart below shows how the fund's investment results have varied from
year to year, and the Investment Results table on page 3 shows how the fund's
average annual total returns for various periods compare with different broad
measures of market performance. This information provides some indication of the
risks of investing in the fund. All fund results reflect the reinvestment of
dividends and capital gain distributions, if any. Unless otherwise noted, fund
results reflect any fee waivers and/or expense reimbursements in effect during
the period presented. Past results are not predictive of future results.




CALENDAR YEAR TOTAL RETURNS FOR CLASS A SHARES
(Results do not include a sales charge; if a sales charge were included,
results would be lower.)

[begin bar chart]


2000  -20.90%
2001   -3.96
2002   -4.62
2003   43.36
2004   20.80


[end bar chart]



Highest/Lowest quarterly results during this time period were:




HIGHEST                    17.30%  (quarter ended June 30, 2003)
LOWEST                    -18.32%  (quarter ended September 30, 2001)


The fund's total return for the nine months ended September 30, 2005, was
17.39%.


                                       2

New World Fund / Prospectus


<PAGE>


Unlike the bar chart on the previous page, the Investment Results table below
reflects, as required by Securities and Exchange Commission rules, the fund's
investment results with the following maximum initial sales charge imposed:

 . Class A share results reflect the maximum initial sales charge of 5.75%. This
   charge is reduced for purchases of $25,000 or more and eliminated for
   purchases of $1 million or more.

 . Class R shares are sold without any initial sales charge.

Results would be higher if calculated without a sales charge.
Unlike the Investment Results table below, the Additional Investment Results
table on page 8 reflects the fund's results calculated without a sales charge.



 INVESTMENT RESULTS (WITH A MAXIMUM SALES CHARGE)
 AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDED DECEMBER 31, 2004:
                                      1 YEAR   5 YEARS    LIFETIME/1/
-----------------------------------------------------------------------

 CLASS A -- FIRST SOLD 6/17/99        13.84%    3.41%        6.68%



                                     1 YEAR   LIFETIME/1/
----------------------------------------------------------

 CLASS R-1 -- FIRST SOLD 6/11/02     19.84%     16.72%
 CLASS R-2 -- FIRST SOLD 6/7/02      19.85      16.83
 CLASS R-3 -- FIRST SOLD 6/6/02      20.31      17.35
 CLASS R-4 -- FIRST SOLD 10/7/02     20.75      32.22
 CLASS R-5 -- FIRST SOLD 5/15/02     21.10      16.26




                                       1 YEAR  5 YEARS   LIFETIME/1/
---------------------------------------------------------------------

 INDEXES
 MSCI/(R)/ All Country World Index/2/  15.75%  -1.79%       0.97%
 MSCI Emerging Markets Index/3/        25.95    4.62        7.48




1 Lifetime results for each share class are measured from the date the share
 class was first sold. Lifetime results for the index(es) shown are measured
 from the date Class A shares were first sold.
2 MSCI All Country World Index is a free float-adjusted market capitalization
 index that is designed to measure equity market performance in the global
 developed and emerging markets, consisting of 49 developed and emerging market
 country indexes. This index is unmanaged and includes reinvested dividends
 and/or distributions, but does not reflect sales charges, commissions, expenses
 or taxes.
3 MSCI Emerging Markets Index is a free float-adjusted market capitalization
 index that is designed to measure equity market performance in the global
 emerging markets, consisting of 26 emerging market country indexes. This index
 is unmanaged and includes reinvested dividends and/or distributions, but does
 not reflect sales charges, commissions, expenses or taxes.


                                       3



                                                    New World Fund / Prospectus
<PAGE>

Fees and expenses of the fund

These tables describe the fees and expenses that you may pay if you buy and hold
shares of the fund.



 SHAREHOLDER FEES (PAID DIRECTLY FROM YOUR INVESTMENT)
                                               CLASS A    ALL R SHARE CLASSES
------------------------------------------------------------------------------

 Maximum initial sales charge on purchases      5.75%/*/         none
 (as a percentage of offering price)
------------------------------------------------------------------------------
 Maximum sales charge on reinvested dividends    none            none
------------------------------------------------------------------------------
 Maximum contingent deferred sales charge        none            none
------------------------------------------------------------------------------
 Redemption or exchange fees                     none            none




* The initial sales charge is reduced for purchases of $25,000 or more and
 eliminated for purchases of $1 million or more.




 ANNUAL FUND OPERATING EXPENSES (DEDUCTED FROM FUND ASSETS)
                                            CLASS  CLASS  CLASS  CLASS   CLASS
                                   CLASS A   R-1    R-2    R-3    R-4     R-5
-------------------------------------------------------------------------------

 Management fees/1/                 0.69%   0.69%  0.69%  0.69%  0.69%   0.69%
-------------------------------------------------------------------------------
 Distribution and/or service        0.26    0.99   0.75   0.50   0.25    none
 (12b-1) fees/2/
-------------------------------------------------------------------------------
 Other expenses                     0.23    0.38   0.83   0.41   0.27    0.20
-------------------------------------------------------------------------------
 Total annual fund operating        1.18    2.06   2.27   1.60   1.21    0.89
 expenses/1/
-------------------------------------------------------------------------------




1 The fund's investment adviser began waiving 5% of its management fees on
 September 1, 2004. Beginning April 1, 2005, this waiver increased to 10% and is
 expected to continue at this level until further review. In addition, the
 investment adviser paid a portion of the fund's transfer agent fees for certain
 R share classes. Total annual fund operating expenses do not reflect any waiver
 or reimbursement. Information regarding the effect of any waiver/reimbursement
 on total annual fund operating expenses can be found in the Financial
 Highlights table and the audited financial statements in the fund's annual
 report.
2 Class A, R-1, R-2, R-3 and R-4 12b-1 fees may not exceed .30%, 1.00%, 1.00%,
 .75% and .50%, respectively, of the class' average net assets annually.


                                       4

New World Fund / Prospectus


<PAGE>

OTHER EXPENSES
The "Other expenses" items in the table above include custodial, legal, transfer
agent and subtransfer agent/recordkeeping payments as well as various other
expenses. Subtransfer agent/recordkeeping payments may be made to third parties
(including affiliates of the fund's investment adviser) that provide
recordkeeping and other administrative services to retirement plans invested in
the fund in lieu of the transfer agent providing such services. The amount paid
for subtransfer agent/recordkeeping services will vary depending on the share
class selected and the entity receiving the payments. The table below shows the
maximum payments to affiliated and unaffiliated entities of the fund's
investment adviser providing services to retirement plans.





                PAYMENTS TO AFFILIATED       PAYMENTS TO UNAFFILIATED ENTITIES
------------           ENTITIES
            -------------------------------------------------------------------

 Class A          .05% of assets or                  .05% of assets or
            $12 per participant position*      $12 per participant position*
-------------------------------------------------------------------------------
 Class R-1          .10% of assets                     .10% of assets
-------------------------------------------------------------------------------
 Class R-2   $27 per participant position              .25% of assets
                 plus .15% of assets
-------------------------------------------------------------------------------
 Class R-3   $12 per participant position              .15% of assets
                 plus .10% of assets
 Class R-4          .10% of assets                     .10% of assets
-------------------------------------------------------------------------------
 Class R-5          .05% of assets                     .05% of assets
-------------------------------------------------------------------------------




* Payment amount depends on the date upon which services commenced.

EXAMPLES

The examples below are intended to help you compare the cost of investing in the
fund with the cost of investing in other mutual funds. The examples assume that
you invest $10,000 in the fund for the time periods indicated, that your
investment has a 5% return each year, that all dividends and capital gain
distributions are reinvested, and that the fund's operating expenses remain the
same as shown above. The examples do not reflect the impact of any fee waivers
or expense reimbursements.

Although your actual costs may be higher or lower, based on these assumptions,
your cumulative estimated expenses would be:






                               1 YEAR  3 YEARS  5 YEARS   10 YEARS
-------------------------------------------------------------------

 Class A*                       $688    $928    $1,187     $1,924
-------------------------------------------------------------------
 Class R-1                       209     646     1,108      2,390
-------------------------------------------------------------------
 Class R-2                       230     709     1,215      2,605
-------------------------------------------------------------------
 Class R-3                       163     505       871      1,900
-------------------------------------------------------------------
 Class R-4                       123     384       665      1,466
-------------------------------------------------------------------
 Class R-5                        91     284       493      1,096
-------------------------------------------------------------------




* Reflects the maximum initial sales charge in the first year.


                                       5

                                                    New World Fund / Prospectus
<PAGE>

Investment objective, strategies and risks

The fund's investment objective is long-term capital appreciation. The fund may
invest in equity securities of any company, regardless of where it is based, if
the fund's investment adviser determines that a significant portion of the
company's assets or revenues (generally 20% or more) is attributable to
developing countries. Under normal market conditions, the fund will invest at
least 35% of its assets in equity and debt securities of issuers primarily based
in qualified countries that have developing economies and/or markets. In
addition, the fund may invest up to 25% of its assets in nonconvertible debt
securities of issuers, including issuers of lower rated bonds and government
bonds, primarily based in qualified countries or that have a significant portion
of their assets or revenues attributable to developing countries. The fund may
also, to a limited extent, invest in securities of issuers based in nonqualified
developing countries.

In determining whether a country is qualified, the fund will consider such
factors as the country's per capita gross domestic product, the percentage of
the country's economy that is industrialized, market capital as a percentage of
gross domestic product, the overall regulatory environment, the presence of
government regulation limiting or banning foreign ownership, and restrictions on
repatriation of initial capital, dividends, interest and/or capital gains. The
fund's investment adviser will maintain a list of qualified countries and
securities in which the fund may invest. Qualified developing countries in which
the fund may invest currently include, but are not limited to, Argentina,
Brazil, Chile, China, Colombia, Croatia, Czech Republic, Dominican Republic,
Egypt, Hungary, India, Israel, Jordan, Malaysia, Mexico, Morocco, Panama, Peru,
Philippines, Poland, Russian Federation, South Africa, Thailand, Turkey and
Venezuela.

The prices of securities held by the fund may decline in response to certain
events, including those directly involving the companies whose securities are
owned by the fund; conditions affecting the general economy; overall market
changes; local, regional or global political, social or economic instability;
and currency and interest rate fluctuations. The growth-oriented, equity-type
securities generally purchased by the fund may involve large price swings and
potential for loss, particularly in the case of smaller capitalization stocks.
Smaller capitalization stocks are often more difficult to value or dispose of,
more difficult to obtain information about and more volatile than stocks of
larger, more established companies.
The values of most debt securities held by the fund may be affected by changing
interest rates and by changes in the effective maturities and credit ratings of
these securities. For example, the values of debt securities in the fund's
portfolio generally will decline when interest rates rise and increase when
interest rates fall. In addition, falling interest rates may cause an issuer to
redeem or "call" a security before its stated maturity, which may result in the
fund having to reinvest the proceeds in lower yielding securities. Debt
securities are also subject to credit risk, which is the possibility that the
credit strength of an issuer will weaken and/or an issuer of a debt security
will fail to make timely payments of


                                       6

New World Fund / Prospectus


<PAGE>

principal or interest and the security will go into default. Lower quality or
longer maturity debt securities generally have higher rates of interest and may
be subject to greater price fluctuations than higher quality or shorter maturity
debt securities. The fund's investment adviser attempts to reduce these risks
through diversification of the portfolio and with ongoing credit analysis of
each issuer, as well as by monitoring economic and legislative developments.

Investments in securities issued by entities based outside the United States may
be subject to the risks described above to a greater extent and may also be
affected by currency controls; different accounting, auditing, financial
reporting and legal standards and practices in some countries; expropriation;
changes in tax policy; greater market volatility; differing securities market
structures; higher transaction costs; and various administrative difficulties,
such as delays in clearing and settling portfolio transactions or in receiving
payment of dividends. These risks may be heightened in connection with
investments in developing countries.

Investing in countries with developing economies and/or markets may involve
risks in addition to and greater than those generally associated with investing
in developed countries. For instance, developing countries may have less
developed legal and accounting systems. The governments of these countries may
be more unstable and more likely to impose capital controls, nationalize a
company or industry, place restrictions on foreign ownership and on withdrawing
sale proceeds of securities from the country, and/or impose punitive taxes that
could adversely affect security prices. In addition, the economies of these
countries may be dependent on relatively few industries that are more
susceptible to local and global changes. Securities markets in these countries
are also relatively small and have substantially lower trading volumes. As a
result, securities issued in these countries may be more volatile and less
liquid than securities issued in countries with more developed economies or
markets.
The fund may also hold cash or money market instruments. The percentage of the
fund invested in such holdings will vary and depends on various factors,
including market conditions and purchases and redemptions of fund shares. A
larger percentage of such holdings could moderate the fund's investment results
in a period of rising market prices; conversely, it could reduce the magnitude
of the fund's loss in the event of falling market prices and provide liquidity
to make additional investments or to meet redemptions.

The fund relies on the professional judgment of its investment adviser to make
decisions about the fund's portfolio investments. The basic investment
philosophy of the investment adviser is to seek to invest in attractively valued
companies that, in its opinion, represent above-average long-term investment
opportunities. The investment adviser believes that an important way to
accomplish this is through fundamental analysis, which may include meeting with
company executives and employees, suppliers, customers and competitors.
Securities may be sold when the investment adviser believes that they no longer
represent relatively attractive investment opportunities.


                                       7

                                                    New World Fund / Prospectus
<PAGE>




ADDITIONAL INVESTMENT RESULTS
Unlike the Investment Results table on page 3, the table below reflects the
fund's results calculated without a sales charge.


 ADDITIONAL INVESTMENT RESULTS (WITHOUT A SALES CHARGE)
 AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDED DECEMBER 31, 2004:
                                      1 YEAR   5 YEARS    LIFETIME/1/
-----------------------------------------------------------------------

 CLASS A -- FIRST SOLD 6/17/99        20.80%    4.64%        7.82%



                                     1 YEAR   LIFETIME/1/
----------------------------------------------------------

 CLASS R-1 -- FIRST SOLD 6/11/02     19.84%     16.72%
 CLASS R-2 -- FIRST SOLD 6/7/02      19.85      16.83
 CLASS R-3 -- FIRST SOLD 6/6/02      20.31      17.35
 CLASS R-4 -- FIRST SOLD 10/7/02     20.75      32.22
 CLASS R-5 -- FIRST SOLD 5/15/02     21.10      16.26




                                     1 YEAR  5 YEARS   LIFETIME/1/
-------------------------------------------------------------------

 INDEXES
 MSCI All Country World Index/2/     15.75%  -1.79%       0.97%
 MSCI Emerging Markets Index/3/      25.95    4.62        7.48





1 Lifetime results for each share class are measured from the date the share
 class was first sold. Lifetime results for the index(es) shown are measured
 from the date Class A shares were first sold.
2 MSCI All Country World Index is a free float-adjusted market capitalization
 index that is designed to measure equity market performance in the global
 developed and emerging markets, consisting of 49 developed and emerging market
 country indexes. This index is unmanaged and includes reinvested dividends
 and/or distributions, but does not reflect sales charges, commissions, expenses
 or taxes.
3 MSCI Emerging Markets Index is a free float-adjusted market capitalization
 index that is designed to measure equity market performance in the global
 emerging markets, consisting of 26 emerging market country indexes. This index
 is unmanaged and includes reinvested dividends and/or distributions, but does
 not reflect sales charges, commissions, expenses or taxes.


                                       8



New World Fund / Prospectus


<PAGE>

[Begin pie chart]

Industry diversification as of October 31, 2005


Financials                16.21%
Bonds & notes                   10.71
Telecommunication Services10.36
Consumer Staples         8.62
Materials                        7.75
Consumer Discretionary           6.77
Other industries                26.51
Short-term securtities and
 other assets less liabilities  13.07


[End pie chart]



Because the fund is actively managed, its holdings will change over time.

For updated information on the fund's portfolio holdings, please visit us at
americanfunds.com.


                                       9

                                                    New World Fund / Prospectus
<PAGE>

Management and organization




INVESTMENT ADVISER
Capital Research and Management Company, an experienced investment management
organization founded in 1931, serves as investment adviser to the fund and other
funds, including the American Funds. Capital Research and Management Company is
a wholly owned subsidiary of The Capital Group Companies, Inc. and is located at
333 South Hope Street, Los Angeles, California 90071, and 135 South State
College Boulevard, Brea, California 92821. Capital Research and Management
Company manages the investment portfolio and business affairs of the fund. The
total management fee paid by the fund, as a percentage of average net assets,
for the previous fiscal year appears in the Annual Fund Operating Expenses table
under "Fees and expenses of the fund." A discussion regarding the basis for the
approval of the fund's investment advisory and service agreement by the fund's
Board of Directors is contained in the fund's semi-annual report to shareholders
for the period ended April 30, 2005.




EXECUTION OF PORTFOLIO TRANSACTIONS
The investment adviser places orders with broker-dealers for the fund's
portfolio transactions. The investment adviser strives to obtain best execution
for the fund's portfolio transactions, taking into account a variety of factors
to produce the most favorable total price reasonably attainable under the
circumstances. These factors include the size and type of transaction, the cost
and quality of executions, and the broker-dealer's ability to offer liquidity
and anonymity. For example, with respect to equity transactions, the fund does
not consider the investment adviser as having an obligation to obtain the lowest
available commission rate to the exclusion of price, service and qualitative
considerations. Subject to the considerations outlined above, the investment
adviser may place orders for the fund's portfolio transactions with
broker-dealers who have sold shares of funds managed by the investment adviser,
or who have provided investment research, statistical or other related services
to the investment adviser. In placing orders for the fund's portfolio
transactions, the investment adviser does not commit to any specific amount of
business with any particular broker-dealer. Subject to best execution, the
investment adviser may consider investment research, statistical or other
related services provided to the adviser in placing orders for the fund's
portfolio transactions. However, when the investment adviser places orders for
the fund's portfolio transactions, it does not give any consideration to whether
a broker-dealer has sold shares of the funds managed by the investment adviser.


PORTFOLIO HOLDINGS
Portfolio holdings information for the fund is available on the American Funds
website at americanfunds.com. To reach this information, access the lower
portion of the fund's details page on the website. A list of the fund's top 10
equity holdings updated as of each month-end is generally posted to this page
within 14 days after the end of the applicable


                                       10

New World Fund / Prospectus


<PAGE>

month. A link to the fund's complete list of publicly disclosed portfolio
holdings updated as of each calendar quarter-end is generally posted to this
page within 45 days after the end of the applicable quarter. Both lists remain
available on the website until new information for the next month or quarter is
posted. Portfolio holdings information for the fund is also contained in reports
filed with the Securities and Exchange Commission.

A description of the fund's policies and procedures regarding disclosure of
information about its portfolio holdings is available in the statement of
additional information.

MULTIPLE PORTFOLIO COUNSELOR SYSTEM

Capital Research and Management Company uses a system of multiple portfolio
counselors in managing mutual fund assets. Under this approach, the portfolio of
a fund is divided into segments managed by individual counselors. Counselors
decide how their respective segments will be invested. In addition, Capital
Research and Management Company's investment analysts may make investment
decisions with respect to a portion of a fund's portfolio. Investment decisions
are subject to the limits provided by a fund's objective(s), policies and
restrictions and the oversight of Capital Research and Management Company's
investment committee.

The primary individual portfolio counselors for New World Fund are:





                                       PRIMARY TITLE WITH      PORTFOLIO
                         PORTFOLIO     INVESTMENT ADVISER      COUNSELOR'S
 PORTFOLIO COUNSELOR/    COUNSELOR     (OR AFFILIATE)          ROLE IN
 FUND TITLE              EXPERIENCE    AND INVESTMENT          MANAGEMENT
 (IF APPLICABLE)        IN THIS FUND   EXPERIENCE              OF THE FUND
--------------------------------------------------------------------------------------

 ROBERT W. LOVELACE       7 years      Senior Vice             Serves as an equity
 President and                         President, Capital      securities portfolio
 Director                              Research and            counselor
                                       Management Company

                                       Investment
                                       professional for 21
                                       years, all with
                                       Capital Research and
                                       Management Company or
                                       affiliate
--------------------------------------------------------------------------------------
 MARK E. DENNING          7 years      Director, Capital       Serves as an equity
 Senior Vice President                 Research and            securities portfolio
                                       Management Company      counselor

                                       Investment
                                       professional for 23
                                       years, all with
                                       Capital Research and
                                       Management Company or
                                       affiliate
--------------------------------------------------------------------------------------
 DAVID C. BARCLAY         7 years      Senior Vice             Serves as a
 Vice President                        President, Capital      fixed-income securities
                                       Research and            portfolio counselor
                                       Management Company

                                       Investment
                                       professional for 25
                                       years in total; 18
                                       years with Capital
                                       Research and
                                       Management Company or
                                       affiliate
--------------------------------------------------------------------------------------
 ALWYN HEONG              7 years      Senior Vice             Serves as an equity
 Vice President                        President, Capital      securities portfolio
                                       Research Company        counselor

                                       Investment
                                       professional for 17
                                       years in total; 13
                                       years with Capital
                                       Research and
                                       Management Company or
                                       affiliate
--------------------------------------------------------------------------------------
 CARL M. KAWAJA           7 years      Senior Vice             Serves as an equity
 Vice President                        President, Capital      securities portfolio
                                       Research Company        counselor

                                       Investment
                                       professional for 18
                                       years in total; 15
                                       years with Capital
                                       Research and
                                       Management Company or
                                       affiliate
--------------------------------------------------------------------------------------






                                       11

                                                    New World Fund / Prospectus
<PAGE>

Information regarding the portfolio counselors' compensation, their ownership of
securities in the fund and other accounts they manage can be found in the
statement of additional information.

CERTAIN PRIVILEGES AND/OR SERVICES DESCRIBED ON THE FOLLOWING PAGES OF THIS
PROSPECTUS AND IN THE STATEMENT OF ADDITIONAL INFORMATION MAY NOT BE AVAILABLE
TO YOU DEPENDING ON YOUR INVESTMENT DEALER OR RETIREMENT PLAN RECORDKEEPER.



PLEASE SEE YOUR FINANCIAL ADVISER, INVESTMENT DEALER OR PLAN RECORDKEEPER FOR
MORE INFORMATION.


                                       12

New World Fund / Prospectus


<PAGE>

Purchase, exchange and sale of shares
AMERICAN FUNDS SERVICE COMPANY, THE FUND'S TRANSFER AGENT, ON BEHALF OF THE FUND
AND AMERICAN FUNDS DISTRIBUTORS, THE FUND'S DISTRIBUTOR, IS REQUIRED BY LAW TO
OBTAIN CERTAIN PERSONAL INFORMATION FROM YOU OR ANY OTHER PERSON(S) ACTING ON
YOUR BEHALF IN ORDER TO VERIFY YOUR OR SUCH PERSON'S IDENTITY. IF YOU DO NOT
PROVIDE THE INFORMATION, THE TRANSFER AGENT MAY NOT BE ABLE TO OPEN YOUR
ACCOUNT. IF THE TRANSFER AGENT IS UNABLE TO VERIFY YOUR IDENTITY OR THAT OF ANY
OTHER PERSON(S) AUTHORIZED TO ACT ON YOUR BEHALF, OR BELIEVES IT HAS IDENTIFIED
POTENTIALLY CRIMINAL ACTIVITY, THE FUND AND AMERICAN FUNDS DISTRIBUTORS RESERVE
THE RIGHT TO CLOSE YOUR ACCOUNT OR TAKE SUCH OTHER ACTION THEY DEEM REASONABLE
OR REQUIRED BY LAW.

PURCHASES AND EXCHANGES

Eligible retirement plans generally may open an account and purchase Class A or
R shares by contacting any investment dealer (who may impose transaction charges
in addition to those described in this prospectus) authorized to sell the fund's
shares. Some or all R share classes may not be available through certain
investment dealers. Additional shares may be purchased through a plan's
administrator or recordkeeper.

Class A shares are generally not available for retirement plans using the
PlanPremier/(R)/ or Recordkeeper Direct/(R)/ recordkeeping programs.
Class R shares generally are available only to 401(k) plans, 457 plans,
employer-sponsored 403(b) plans, profit-sharing and money purchase pension
plans, defined benefit plans and nonqualified deferred compensation plans. Class
R shares also are generally available only to retirement plans where plan level
or omnibus accounts are held on the books of the fund. In addition, Class R-5
shares generally are available only to retirement plans with $1 million or more
in plan assets. Class R shares generally are not available to retail
nonretirement accounts, Traditional and Roth Individual Retirement Accounts
(IRAs), Coverdell Education Savings Accounts, SEPs, SARSEPs, SIMPLE IRAs,
individual 403(b) plans and 529 college savings plans, such as
CollegeAmerica./(R)/ CollegeAmerica is sponsored by and is a registered
trademark of the Virginia College Savings Plan,/SM /an agency of the
Commonwealth of Virginia.

Shares of the fund offered through this prospectus generally may be exchanged
into shares of the same class of other American Funds. Exchanges of Class A
shares from American Funds money market funds purchased without a sales charge
generally will be subject to the appropriate sales charge.


                                       13

                                                    New World Fund / Prospectus
<PAGE>

FREQUENT TRADING OF FUND SHARES
The fund and American Funds Distributors reserve the right to reject any
purchase order for any reason. The fund is not designed to serve as a vehicle
for frequent trading in response to short-term fluctuations in the securities
markets. Accordingly, purchases, including those that are part of exchange
activity, that the fund or American Funds Distributors has determined could
involve actual or potential harm to the fund may be rejected. Frequent trading
of fund shares may lead to increased costs to the fund and less efficient
management of the fund's portfolio, resulting in dilution of the value of the
shares held by long-term shareholders.

The fund's Board of Directors has adopted policies and procedures with respect
to frequent purchases and redemptions of fund shares. Under the fund's "purchase
blocking policy," any shareholder redeeming shares (including redemptions that
are part of an exchange transaction) having a value of $5,000 or more from the
fund will be precluded from investing in the fund (including investments that
are part of an exchange transaction) for 30 calendar days after the redemption
transaction. This prohibition will not apply to redemptions by shareholders
whose shares are held on the books of third-party intermediaries that have not
adopted procedures to implement this policy. American Funds Service Company will
work with intermediaries to develop such procedures or other procedures that
American Funds Service Company determines are reasonably designed to achieve the
objective of the purchase blocking policy. At the time the intermediaries adopt
these procedures, shareholders whose accounts are on the books of such
intermediaries will be subject to this purchase blocking policy or another
frequent trading policy that achieves the objective of the purchase blocking
policy. There is no guarantee that all instances of frequent trading in fund
shares will be prevented.

Under the fund's purchase blocking policy, certain purchases will not be
prevented and certain redemptions will not trigger a purchase block, such as:
systematic redemptions and purchases where the entity maintaining the
shareholder account is able to identify the transaction as a systematic
redemption or purchase; purchases and redemptions of shares having a value of
less than $5,000; retirement plan contributions, loans and distributions
(including hardship withdrawals) identified as such on the retirement plan
recordkeeper's system; and purchase transactions involving transfers of assets,
rollovers, Roth IRA conversions and IRA re-characterizations, where the entity
maintaining the shareholder account is able to identify the transaction as one
of these types of transactions. The statement of additional information contains
more information about how American Funds Service Company may address other
potentially abusive trading activity in the American Funds.

SALES

Please contact your plan administrator or recordkeeper in order to sell shares
from your retirement plan.


                                       14

New World Fund / Prospectus


<PAGE>

If you notify American Funds Service Company, you may reinvest proceeds from a
redemption, dividend payment or capital gain distribution without a sales charge
in the same fund or other American Funds within 90 days after the date of the
redemption or distribution. Proceeds will be reinvested in the same share class
from which the original redemption or distribution was made. Redemption proceeds
of Class A shares representing direct purchases in American Funds money market
funds that are reinvested in non-money market American Funds will be subject to
a sales charge. Proceeds will be reinvested at the next calculated net asset
value after your request is received and accepted by American Funds Service
Company. You may not reinvest proceeds in the American Funds as described in
this paragraph if such proceeds are subject to a purchase block as described
under "Frequent trading of fund shares." This paragraph does not apply to
rollover investments as described under "Rollovers from retirement plans to
IRAs."




VALUING SHARES
The net asset value of each share class of the fund is the value of a single
share. The fund calculates the net asset value each day the New York Stock
Exchange is open as of approximately 4:00 p.m. New York time, the normal close
of regular trading. Assets are valued primarily on the basis of market
quotations. However, the fund has adopted procedures for making "fair value"
determinations if market quotations are not readily available or are not
considered reliable. For example, if events occur between the close of markets
outside the United States and the close of regular trading on the New York Stock
Exchange that, in the opinion of the investment adviser, materially affect the
value of the fund's securities that principally trade in those international
markets, the securities will be valued in accordance with fair value procedures.
Use of these procedures is intended to result in more appropriate net asset
values. In addition, such use will reduce, if not eliminate, potential arbitrage
opportunities otherwise available to short-term investors.

Because the fund may hold securities that are primarily listed on foreign
exchanges that trade on weekends or days when the fund does not price its
shares, the value of securities held in the fund may change on days when you
will not be able to purchase or redeem fund shares.

Your shares will be purchased at the net asset value (plus any applicable sales
charge in the case of Class A shares) or sold at the net asset value next
determined after American Funds Service Company receives and accepts your
request.


                                       15

                                                    New World Fund / Prospectus
<PAGE>

Sales charges

CLASS A SHARES

The initial sales charge you pay each time you buy Class A shares differs
depending upon the amount you invest and may be reduced or eliminated for larger
purchases as indicated below. The "offering price," the price you pay to buy
shares, includes any applicable sales charge, which will be deducted directly
from your investment. Shares acquired through reinvestment of dividends or
capital gain distributions are not subject to an initial sales charge.





                              SALES CHARGE AS A
                                         PERCENTAGE OF:
                                                                 DEALER
                                                   NET         COMMISSION
                                       OFFERING   AMOUNT     AS A PERCENTAGE
 INVESTMENT                             PRICE    INVESTED   OF OFFERING PRICE
------------------------------------------------------------------------------

 Less than $25,000                      5.75%     6.10%           5.00%
------------------------------------------------------------------------------
 $25,000 but less than $50,000          5.00      5.26            4.25
------------------------------------------------------------------------------
 $50,000 but less than $100,000         4.50      4.71            3.75
------------------------------------------------------------------------------
 $100,000 but less than $250,000        3.50      3.63            2.75
------------------------------------------------------------------------------
 $250,000 but less than $500,000        2.50      2.56            2.00
------------------------------------------------------------------------------
 $500,000 but less than $750,000        2.00      2.04            1.60
------------------------------------------------------------------------------
 $750,000 but less than $1 million      1.50      1.52            1.20
------------------------------------------------------------------------------
 $1 million or more and certain other   none      none      see below
 investments described below
------------------------------------------------------------------------------




The sales charge, expressed as a percentage of the offering price or the net
amount invested, may be higher or lower than the percentages described in the
table above due to rounding. This is because the dollar amount of the sales
charge is determined by subtracting the net asset value of the shares purchased
from the offering price, which is calculated to two decimal places using
standard rounding criteria. The impact of rounding will vary with the size of
the investment and the net asset value of the shares.

CLASS A PURCHASES NOT SUBJECT TO SALES CHARGES
The following investments are not subject to any initial or contingent deferred
sales charge if American Funds Service Company is properly notified of the
nature of the investment:

. investments made by accounts that are part of certain qualified fee-based
 programs and that purchased Class A shares before March 15, 2001; and

. certain rollover investments from retirement plans to IRAs (see "Rollovers
 from retirement plans to IRAs" below for more information).


                                       16

New World Fund / Prospectus


<PAGE>

The distributor may pay dealers up to 1% on investments made in Class A shares
with no initial sales charge. The fund may reimburse the distributor for these
payments through its plans of distribution (see "Plans of distribution" below).

Certain other investors may qualify to purchase shares without a sales charge,
such as employees of investment dealers and registered investment advisers
authorized to sell American Funds, and employees of The Capital Group Companies.
Please see the statement of additional information for more information.

 EMPLOYER-SPONSORED RETIREMENT PLANS

 Employer-sponsored retirement plans not currently invested in Class A shares
 and wishing to invest without a sales charge are not eligible to purchase Class
 A shares. Such plans may invest only in Class R shares.

 Provided that the plan's recordkeeper can properly apply a sales charge on the
 plan's investments, an employer-sponsored retirement plan not currently
 invested in Class A shares and wishing to invest less than $1 million may
 invest in Class A shares, but the purchase of these shares will be subject to
 the applicable sales charge. An employer-sponsored retirement plan that
 purchases Class A shares with a sales charge will be eligible to purchase
 additional Class A shares in accordance with the sales charge table above. If
 the recordkeeper cannot properly apply a sales charge on the plan's
 investments, then the plan may invest only in Class R shares.
 Employer-sponsored retirement plans not currently invested in Class A shares,
 or that are currently investing in Class A shares with a sales charge, are not
 eligible to establish a statement of intention that qualifies them to purchase
 Class A shares without a sales charge. More information about statements of
 intention can be found under "Sales charge reductions."

 Employer-sponsored retirement plans that invested in Class A shares without any
 sales charge on or before March 31, 2004, and that continue to meet the
 eligibility requirements in effect as of that date for purchasing Class A
 shares at net asset value, may continue to purchase Class A shares without any
 initial or contingent deferred sales charge.

CLASS R SHARES

Class R shares are sold without any initial or contingent deferred sales charge.
The distributor will pay dealers annually an asset-based compensation of 1.00%
for sales of Class R-1 shares, .75% for Class R-2 shares, .50% for Class R-3
shares and .25% for Class R-4 shares. No dealer compensation is paid on sales of
Class R-5 shares. The fund may reimburse the distributor for these payments
through its plans of distribution (see "Plans of distribution" below).


                                       17

                                                    New World Fund / Prospectus
<PAGE>

Sales charge reductions

TO RECEIVE A REDUCTION IN YOUR CLASS A INITIAL SALES CHARGE, YOU MUST LET YOUR
FINANCIAL ADVISER OR AMERICAN FUNDS SERVICE COMPANY KNOW AT THE TIME YOU
PURCHASE SHARES THAT YOU QUALIFY FOR SUCH A REDUCTION. IF YOU DO NOT LET YOUR
ADVISER OR AMERICAN FUNDS SERVICE COMPANY KNOW THAT YOU ARE ELIGIBLE FOR A
REDUCTION, YOU MAY NOT RECEIVE A SALES CHARGE DISCOUNT TO WHICH YOU ARE
OTHERWISE ENTITLED. In order to determine your eligibility to receive a sales
charge discount, it may be necessary for you to provide your adviser or American
Funds Service Company with information and records (including account
statements) of all relevant accounts invested in the American Funds.

REDUCING YOUR CLASS A INITIAL SALES CHARGE

Consistent with the policies described in this prospectus, two or more
retirement plans of an employer or employer's affiliates may combine all of
their American Funds investments to reduce their Class A sales charge. However,
for this purpose, investments representing direct purchases of American Funds
money market funds are excluded.

 CONCURRENT PURCHASES

 Simultaneous purchases of any class of shares of two or more American Funds may
 be combined to qualify for a reduced Class A sales charge.

 RIGHTS OF ACCUMULATION
 You have the right to take into account your accumulated holdings in all share
 classes of the American Funds to determine the initial sales charge you pay on
 each purchase of Class A shares. Subject to your investment dealer's or
 recordkeeper's capabilities, your accumulated holdings will be calculated as
 the higher of (a) the current value of your existing holdings or (b) the amount
 you invested (excluding capital appreciation) less any withdrawals. Please see
 the statement of additional information for details. You should retain any
 records necessary to substantiate the historical amounts you have invested. The
 current value of existing investments in an American Legacy/(R)/ Retirement
 Investment Plan may also be taken into account to determine your Class A sales
 charge.

 STATEMENT OF INTENTION
 You may reduce your Class A sales charge by establishing a statement of
 intention. A statement of intention allows all American Funds non-money market
 fund purchases of all share classes intended to be made over a 13-month period
 to be combined in order to determine the applicable sales charge; however,
 investments made under a right of reinvestment, appreciation of your
 investment, and reinvested dividends and capital gains do not apply toward
 these combined purchases. At the request of a plan, purchases made during the
 previous 90 days may be included. A portion of the account may be held in
 escrow to cover additional Class A sales charges that may be due if total
 investments over the 13-month period do not qualify for the applicable sales
 charge


                                       18

New World Fund / Prospectus


<PAGE>

 reduction. Employer-sponsored retirement plans may be restricted from
 establishing statements of intention. See "Sales charges" above for more
 information.

RIGHT OF REINVESTMENT

Please see the "Sales" section of "Purchase, exchange and sale of shares" above
for information on how to reinvest proceeds from a redemption, dividend payment
or capital gain distribution without a sales charge.

YOU MAY OBTAIN MORE INFORMATION ABOUT SALES CHARGE REDUCTIONS THROUGH A LINK ON
THE HOME PAGE OF THE AMERICAN FUNDS WEBSITE AT AMERICANFUNDS.COM, FROM THE
STATEMENT OF ADDITIONAL INFORMATION OR FROM YOUR FINANCIAL ADVISER.

Rollovers from retirement plans to IRAs
Assets from retirement plans may be invested in Class A, B, C or F shares
through an IRA rollover. More information on Class B, C and F shares can be
found in the fund's prospectus for non-retirement plan shareholders. Rollovers
invested in Class A shares from retirement plans will be subject to applicable
sales charges. The following rollovers to Class A shares will be made at no
sales charge:

. rollovers to IRAs from 403(b) plans with Capital Bank and Trust Company as
 custodian; and

. rollovers to IRAs that are attributable to American Funds investments, if they
 meet the following three requirements:

 -- the retirement plan from which assets are being rolled over is part of an
   American Funds proprietary retirement plan program (such as PlanPremier,
   Recordkeeper Direct or Recordkeeper Connect/(R)/) or is a plan whose
   participant subaccounts are serviced by American Funds Service Company;

 -- the plan's assets were invested in American Funds at the time of
   distribution; and

 -- the plan's assets are rolled over to an American Funds IRA with Capital Bank
   and Trust Company as custodian.

IRA rollover assets that roll over at no sales charge as described above will
not be subject to a contingent deferred sales charge and investment dealers will
be compensated solely with an annual service fee that begins to accrue
immediately. IRA rollover assets that are not attributable to American Funds
investments, as well as future contributions to the IRA, will be subject to
sales charges and the terms and conditions generally applicable to Class A share
investments as described in the prospectus and statement of additional
information if invested in Class A shares.

TRANSFERS TO IRAS

Transfers to IRAs that are attributable to American Funds investments held in
SIMPLE IRAs, SEPs or SARSEPs will not be subject to a sales charge if invested
in Class A shares.


                                       19

                                                    New World Fund / Prospectus
<PAGE>

Plans of distribution
The fund has plans of distribution or "12b-1 plans" under which it may finance
activities primarily intended to sell shares, provided the categories of
expenses are approved in advance by the fund's Board of Directors. The plans
provide for payments, based on annualized percentages of average daily net
assets, of up to .30% for Class A shares, up to 1.00% for Class R-1 and R-2
shares, up to .75% for Class R-3 shares and up to .50% for Class R-4 shares. For
all share classes, up to .25% of these expenses may be used to pay service fees
to qualified dealers for providing certain shareholder services. The amount
remaining for each share class may be used for distribution expenses.

The 12b-1 fees paid by the fund, as a percentage of average net assets, for the
previous fiscal year are indicated in the Annual Fund Operating Expenses table
under "Fees and expenses of the fund." Since these fees are paid out of the
fund's assets or income on an ongoing basis, over time they will increase the
cost and reduce the return of your investment.

Other compensation to dealers
American Funds Distributors, at its expense, currently provides additional
compensation to investment dealers. These payments may be made, at the
discretion of American Funds Distributors, to the top 75 dealers who have sold
shares of the American Funds. The level of payments made to a qualifying dealer
in any given year will vary and in no case would exceed the sum of (a) .10% of
the previous year's American Funds sales by that dealer and (b) .02% of American
Funds assets attributable to that dealer. For calendar year 2004, aggregate
payments made by American Funds Distributors to dealers were less than .02% of
the assets of the American Funds. Aggregate payments may also change from year
to year. A number of factors will be considered in determining payments,
including the qualifying dealer's sales, assets and redemption rates, and the
quality of the dealer's relationship with American Funds Distributors. American
Funds Distributors makes these payments to help defray the costs incurred by
qualifying dealers in connection with efforts to educate financial advisers
about the American Funds so that they can make recommendations and provide
services that are suitable and meet shareholder needs. American Funds
Distributors will, on an annual basis, determine the advisability of continuing
these payments. American Funds Distributors may also pay expenses associated
with meetings conducted by dealers outside the top 75 firms to facilitate
educating financial advisers and shareholders about the American Funds.


                                       20

New World Fund / Prospectus


<PAGE>

Distributions and taxes




DIVIDENDS AND DISTRIBUTIONS

The fund intends to distribute dividends to you, usually in December.

Capital gains, if any, are usually distributed in December. When a dividend or
capital gain is distributed, the net asset value per share is reduced by the
amount of the payment.

All dividends and capital gain distributions paid to retirement plan
shareholders will be automatically reinvested.




TAXES ON DIVIDENDS AND DISTRIBUTIONS

Dividends and capital gains distributed by the fund to tax-deferred retirement
plan accounts are not taxable currently.

TAXES ON TRANSACTIONS
Exchanges within a tax-deferred retirement plan account will not result in a
capital gain or loss for federal or state income tax purposes. With limited
exceptions, distributions taken from a retirement plan account are taxable as
ordinary income.

PLEASE SEE YOUR TAX ADVISER FOR MORE INFORMATION.


                                       21

                                                    New World Fund / Prospectus
<PAGE>

Financial highlights/1/

The Financial Highlights table is intended to help you understand the fund's
results for the past five fiscal years. Certain information reflects financial
results for a single share of a particular class. The total returns in the table
represent the rate that an investor would have earned or lost on an investment
in the fund (assuming reinvestment of all dividends and capital gain
distributions). This information has been audited by Deloitte & Touche LLP,
whose report, along with the fund's financial statements, is included in the
statement of additional information, which is available upon request.



                                                 INCOME (LOSS) FROM INVESTMENT OPERATIONS/2/


                                                                       Net
                                                                 gains (losses)
                                      Net asset                   on securities
                                       value,         Net        (both realized   Total from
                                      beginning    investment          and        investment
                                      of period  income (loss)     unrealized)    operations
-----------------------------------------------------------------------------------------------

CLASS A:
Year ended 10/31/2005                  $29.68        $.68            $ 6.51         $ 7.19
Year ended 10/31/2004                   25.60         .47              4.20           4.67
Year ended 10/31/2003                   18.90         .39              6.56           6.95
Year ended 10/31/2002                   19.04         .34               .07            .41
Year ended 10/31/2001                   22.81         .47             (3.87)         (3.40)
-----------------------------------------------------------------------------------------------
CLASS R-1:
Year ended 10/31/2005                   29.22         .40              6.41           6.81
Year ended 10/31/2004                   25.33         .25              4.14           4.39
Year ended 10/31/2003                   18.85         .23              6.50           6.73
Period from 6/11/2002 to 10/31/2002     22.44         .01             (3.60)         (3.59)
-----------------------------------------------------------------------------------------------
CLASS R-2:
Year ended 10/31/2005                   29.21         .41              6.40           6.81
Year ended 10/31/2004                   25.34         .25              4.14           4.39
Year ended 10/31/2003                   18.86         .22              6.51           6.73
Period from 6/7/2002 to 10/31/2002      22.37        (.02 )           (3.49)         (3.51)
-----------------------------------------------------------------------------------------------
CLASS R-3:
Year ended 10/31/2005                   29.53         .55              6.47           7.02
Year ended 10/31/2004                   25.56         .36              4.18           4.54
Year ended 10/31/2003                   18.96         .30              6.56           6.86
Period from 6/6/2002 to 10/31/2002      22.41         .03             (3.48)         (3.45)
-----------------------------------------------------------------------------------------------
CLASS R-4:
Year ended 10/31/2005                  $29.72        $.68            $ 6.49         $ 7.17
Year ended 10/31/2004                   25.68         .47              4.20           4.67
Year ended 10/31/2003                   18.90         .39              6.57           6.96
Period from 10/7/2002 to 10/31/2002     18.21          --/6/            .69            .69
-----------------------------------------------------------------------------------------------
CLASS R-5:
Year ended 10/31/2005                   29.76         .78              6.51           7.29
 Year ended 10/31/2004                  25.66         .55              4.20           4.75
 Year ended 10/31/2003                  18.93         .46              6.57           7.03
 Period from 5/15/2002 to 10/31/2002    23.05         .12             (4.24)         (4.12)









                                      Dividends
                                      (from net     Net asset
                                      investment  value, end of    Total
                                       income)       period      return/3/
----------------------------------------------------------------------------

CLASS A:
Year ended 10/31/2005                   $(.55)       $36.32        24.50%
Year ended 10/31/2004                    (.59)        29.68        18.51
Year ended 10/31/2003                    (.25)        25.60        37.19
Year ended 10/31/2002                    (.55)        18.90         1.95
Year ended 10/31/2001                    (.37)        19.04       (15.13)
----------------------------------------------------------------------------
CLASS R-1:
Year ended 10/31/2005                    (.39)        35.64        23.51
Year ended 10/31/2004                    (.50)        29.22        17.57
Year ended 10/31/2003                    (.25)        25.33        36.07
Period from 6/11/2002 to 10/31/2002        --         18.85       (16.00)
----------------------------------------------------------------------------
CLASS R-2:
Year ended 10/31/2005                    (.40)        35.62        23.53
Year ended 10/31/2004                    (.52)        29.21        17.58
Year ended 10/31/2003                    (.25)        25.34        36.09
Period from 6/7/2002 to 10/31/2002         --         18.86       (15.69)
----------------------------------------------------------------------------
CLASS R-3:
Year ended 10/31/2005                    (.48)        36.07        24.02
Year ended 10/31/2004                    (.57)        29.53        18.03
Year ended 10/31/2003                    (.26)        25.56        36.63
Period from 6/6/2002 to 10/31/2002         --         18.96       (15.39)
----------------------------------------------------------------------------
CLASS R-4:
Year ended 10/31/2005                   $(.56)       $36.33        24.44%
Year ended 10/31/2004                    (.63)        29.72        18.48
Year ended 10/31/2003                    (.18)        25.68        37.14
Period from 10/7/2002 to 10/31/2002        --         18.90         3.79
----------------------------------------------------------------------------
CLASS R-5:
Year ended 10/31/2005                    (.62)        36.43        24.83
 Year ended 10/31/2004                   (.65)        29.76        18.83
 Year ended 10/31/2003                   (.30)        25.66        37.60
 Period from 5/15/2002 to 10/31/2002       --         18.93       (17.87)


                                                      Ratio of     Ratio of
                                                      expenses     expenses
                                                     to average   to average
                                                     net assets   net assets
                                       Net assets,     before        after      Ratio of net
                                         end of         reim-        reim-      income (loss)
                                         period      bursements/  bursements/    to average
                                      (in millions)    waivers    waivers/4/     net assets
----------------------------------------------------------------------------------------------

CLASS A:
Year ended 10/31/2005                    $4,195         1.18%        1.12%         2.00 %
Year ended 10/31/2004                     2,212         1.23         1.22          1.68
Year ended 10/31/2003                     1,528         1.31         1.31          1.86
Year ended 10/31/2002                     1,071         1.34         1.34          1.65
Year ended 10/31/2001                     1,053         1.29         1.29          2.15
----------------------------------------------------------------------------------------------
CLASS R-1:
Year ended 10/31/2005                         3         2.06         1.92          1.19
Year ended 10/31/2004                         2         2.16         2.04           .92
Year ended 10/31/2003                        --/5/      2.84         2.10          1.05
Period from 6/11/2002 to 10/31/2002          --/5/      3.49          .81           .06
----------------------------------------------------------------------------------------------
CLASS R-2:
Year ended 10/31/2005                        47         2.27         1.89          1.23
Year ended 10/31/2004                        17         2.57         2.00           .91
Year ended 10/31/2003                         6         2.69         2.06           .98
Period from 6/7/2002 to 10/31/2002            1         1.04          .83          (.11 )
----------------------------------------------------------------------------------------------
CLASS R-3:
Year ended 10/31/2005                        41         1.60         1.51          1.62
Year ended 10/31/2004                        16         1.70         1.62          1.30
Year ended 10/31/2003                         6         1.84         1.68          1.37
Period from 6/6/2002 to 10/31/2002            1          .77          .68           .13
----------------------------------------------------------------------------------------------
CLASS R-4:
Year ended 10/31/2005                    $   14         1.21%        1.15%         1.98 %
Year ended 10/31/2004                         3         1.29         1.27          1.66
Year ended 10/31/2003                         1         1.43         1.33          1.79
Period from 10/7/2002 to 10/31/2002          --/5/       .13          .09            --/7/
----------------------------------------------------------------------------------------------
CLASS R-5:
Year ended 10/31/2005                       187          .89          .84          2.28
 Year ended 10/31/2004                       87          .95          .94          1.96
 Year ended 10/31/2003                       45         1.01         1.01          2.15
 Period from 5/15/2002 to 10/31/2002         27          .46          .46           .62






                                       22

New World Fund / Prospectus


<PAGE>




                                          YEAR ENDED OCTOBER 31
                           2005        2004        2003        2002         2001
------------------------------------------------------------------------------------

 PORTFOLIO TURNOVER
RATE FOR ALL CLASSES       26%         20%         30%         32%          40%
OF SHARES





1 Based on operations for the period shown (unless otherwise noted) and,
 accordingly, may not be representative of a full year.
2 Based on average shares outstanding.
3 Total returns exclude all sales charges.
4 The ratios in this column reflect the impact, if any, of certain
 reimbursements/waivers from Capital Research and Management Company. See the
 Annual Fund Operating Expenses table under "Fees and expenses of the fund" and
 the audited financial statements in the fund's annual report for more
 information.
5 Amount less than $1 million.
6 Amount less than one cent.
7 Amount less than .01 percent.
                                                    New World Fund / Prospectus


                                       23

<PAGE>

NOTES


                                       24

New World Fund / Prospectus


<PAGE>

NOTES


                                       25

                                                    New World Fund / Prospectus
<PAGE>

NOTES


                                       26

New World Fund / Prospectus


<PAGE>

NOTES


                                       27



                                                    New World Fund / Prospectus

<PAGE>



[logo - American Funds /(R)/]              The right choice for the long term/(R)/





          FOR SHAREHOLDER SERVICES         American Funds Service Company
                                           800/421-0180
          FOR RETIREMENT PLAN SERVICES     Call your employer or plan administrator
          FOR DEALER SERVICES              American Funds Distributors
                                           800/421-9900
                                           americanfunds.com
          FOR 24-HOUR INFORMATION          For Class R share information,visit
                                           AmericanFundsRetirement.com


          Telephone calls you have with the American Funds
          organization may be monitored or recorded for
          quality-assurance, verification and/or recordkeeping
          purposes. By speaking with us on the telephone, you are
          giving your consent to such monitoring and recording.
-----------------------------------------------------------------------------------



MULTIPLE TRANSLATIONS  This prospectus may be translated into other languages.
If there is any inconsistency or ambiguity as to the meaning of any word or
phrase in a translation, the English text will prevail.

ANNUAL/SEMI-ANNUAL REPORT TO SHAREHOLDERS  The shareholder reports contain
additional information about the fund, including financial statements,
investment results, portfolio holdings, a discussion of market conditions and
the fund's investment strategies, and the independent registered public
accounting firm's report (in the annual report).



STATEMENT OF ADDITIONAL INFORMATION (SAI) AND CODES OF ETHICS The current SAI,
as amended from time to time, contains more detailed information on all aspects
of the fund, including the fund's financial statements, and is incorporated by
reference into this prospectus. This means that the current SAI, for legal
purposes, is part of this prospectus. The codes of ethics describe the personal
investing policies adopted by the fund and the fund's investment adviser and its
affiliated companies.

The codes of ethics and current SAI are on file with the Securities and Exchange
Commission (SEC). These and other related materials about the fund are available
for review or to be copied at the SEC's Public Reference Room in Washington, DC
(202/942-8090) or on the EDGAR database on the SEC's website at www.sec.gov or,
after payment of a duplicating fee, via e-mail request to publicinfo@sec.gov or
by writing to the SEC's Public Reference Section, Washington, DC 20549-0102. The
current SAI is also available on americanfunds.com.

HOUSEHOLD MAILINGS Each year you are automatically sent an updated prospectus
and annual and semi-annual reports for the fund. You may also occasionally
receive proxy statements for the fund. In order to reduce the volume of mail you
receive, when possible, only one copy of these documents will be sent to
shareholders who are part of the same family and share the same residential address.

If you would like to opt out of household mailings or receive a complimentary
copy of the current SAI, codes of ethics or annual/semi-annual report to
shareholders, please call American Funds Service Company at 800/421-0180 or
write to the Secretary of the fund at 333 South Hope Street, Los Angeles,
California 90071.


[recycle bug logo]







Printed on recycled paper
RPGEPR-936-0106P Litho in USA              Investment Company File No. 811-9105
CGD/RRD/8041
-------------------------------------------------------------------------------
THE CAPITAL GROUP COMPANIES
American Funds Capital Research and Management   Capital International  Capital Guardian   Capital Bank and Trust


<PAGE>



THE FUND PROVIDES SPANISH TRANSLATION IN CONNECTION WITH THE
PUBLIC OFFERING AND SALE OF ITS SHARES. THE FOLLOWING IS A FAIR
AND ACCURATE ENGLISH TRANSLATION OF A SPANISH LANGUAGE PROSPECTUS
FOR THE FUND.


/s/ VINCENT P. CORTI
    VINCENT P. CORTI
    SECRETARY





<PAGE>



[logo - American Funds /(R)/]              The right choice for the long term/(R)/




New World Fund/SM/




 RETIREMENT PLAN
 PROSPECTUS




 January 1, 2006











TABLE OF CONTENTS

 1    Risk/Return summary
 4    Fees and expenses of the fund
 6    Investment objective, strategies and risks
10    Management and organization
13    Purchase, exchange and sale of shares
16    Sales charges
18    Sales charge reductions
19    Rollovers from retirement plans to IRAs
20    Plans of distribution
20    Other compensation to dealers
21    Distributions and taxes
22    Financial highlights





 THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED OF
 THESE SECURITIES. FURTHER, IT HAS NOT DETERMINED THAT THIS PROSPECTUS IS
 ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
 OFFENSE.



<PAGE>

 [This page intentionally left blank for this filing.]

<PAGE>

Risk/Return summary

The fund seeks to make your investment grow over time by investing primarily in
stocks of companies with significant exposure to countries with developing
economies and/or markets. The fund may also invest in debt securities of
issuers, including issuers of lower rated bonds, with exposure to these
countries.
The fund is designed for investors seeking capital appreciation.  Investors in
the fund should have a long-term perspective and be able to tolerate potentially
wide price fluctuations. Your investment in the fund is subject to risks,
including the possibility that the value of the fund's portfolio holdings may
fluctuate in response to events specific to the companies in which the fund
invests, as well as economic, political or social events in the United States or
abroad. The values of debt securities owned by the fund may be affected by
changing interest rates and credit risk assessments. Lower quality or longer
maturity bonds may be subject to greater price fluctuations than higher quality
or shorter maturity bonds.

Although all securities in the fund's portfolio may be adversely affected by
currency fluctuations or global economic, political or social instability,
securities issued by entities based outside the United States, particularly in
countries with developing economies and/or markets, may be affected to a greater
extent.

Your investment in the fund is not a bank deposit and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency, entity or person.
YOU MAY LOSE MONEY BY INVESTING IN THE FUND. THE LIKELIHOOD OF LOSS MAY BE
GREATER IF YOU INVEST FOR A SHORTER PERIOD OF TIME.


                                       1

                                                    New World Fund / Prospectus
<PAGE>




HISTORICAL INVESTMENT RESULTS
The bar chart below shows how the fund's investment results have varied from
year to year, and the Investment Results table on page 3 shows how the fund's
average annual total returns for various periods compare with different broad
measures of market performance. This information provides some indication of the
risks of investing in the fund. All fund results reflect the reinvestment of
dividends and capital gain distributions, if any. Unless otherwise noted, fund
results reflect any fee waivers and/or expense reimbursements in effect during
the period presented. Past results are not predictive of future results.




CALENDAR YEAR TOTAL RETURNS FOR CLASS A SHARES
(Results do not include a sales charge; if a sales charge were included,
results would be lower.)

[begin bar chart]


2000  -20.90%
2001   -3.96
2002   -4.62
2003   43.36
2004   20.80


[end bar chart]



Highest/Lowest quarterly results during this time period were:




HIGHEST                    17.30%  (quarter ended June 30, 2003)
LOWEST                    -18.32%  (quarter ended September 30, 2001)


The fund's total return for the nine months ended September 30, 2005, was
17.39%.


                                       2

New World Fund / Prospectus


<PAGE>


Unlike the bar chart on the previous page, the Investment Results table below
reflects, as required by Securities and Exchange Commission rules, the fund's
investment results with the following maximum initial sales charge imposed:

 . Class A share results reflect the maximum initial sales charge of 5.75%. This
   charge is reduced for purchases of $25,000 or more and eliminated for
   purchases of $1 million or more.

 . Class R shares are sold without any initial sales charge.

Results would be higher if calculated without a sales charge.
Unlike the Investment Results table below, the Additional Investment Results
table on page 8 reflects the fund's results calculated without a sales charge.



 INVESTMENT RESULTS (WITH A MAXIMUM SALES CHARGE)
 AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDED DECEMBER 31, 2004:
                                      1 YEAR   5 YEARS    LIFETIME/1/
-----------------------------------------------------------------------

 CLASS A -- FIRST SOLD 6/17/99        13.84%    3.41%        6.68%



                                     1 YEAR   LIFETIME/1/
----------------------------------------------------------

 CLASS R-1 -- FIRST SOLD 6/11/02     19.84%     16.72%
 CLASS R-2 -- FIRST SOLD 6/7/02      19.85      16.83
 CLASS R-3 -- FIRST SOLD 6/6/02      20.31      17.35
 CLASS R-4 -- FIRST SOLD 10/7/02     20.75      32.22
 CLASS R-5 -- FIRST SOLD 5/15/02     21.10      16.26




                                       1 YEAR  5 YEARS   LIFETIME/1/
---------------------------------------------------------------------

 INDEXES
 MSCI/(R)/ All Country World Index/2/  15.75%  -1.79%       0.97%
 MSCI Emerging Markets Index/3/        25.95    4.62        7.48




1 Lifetime results for each share class are measured from the date the share
 class was first sold. Lifetime results for the index(es) shown are measured
 from the date Class A shares were first sold.
2 MSCI All Country World Index is a free float-adjusted market capitalization
 index that is designed to measure equity market performance in the global
 developed and emerging markets, consisting of 49 developed and emerging market
 country indexes. This index is unmanaged and includes reinvested dividends
 and/or distributions, but does not reflect sales charges, commissions, expenses
 or taxes.
3 MSCI Emerging Markets Index is a free float-adjusted market capitalization
 index that is designed to measure equity market performance in the global
 emerging markets, consisting of 26 emerging market country indexes. This index
 is unmanaged and includes reinvested dividends and/or distributions, but does
 not reflect sales charges, commissions, expenses or taxes.


                                       3



                                                    New World Fund / Prospectus
<PAGE>

Fees and expenses of the fund

These tables describe the fees and expenses that you may pay if you buy and hold
shares of the fund.



 SHAREHOLDER FEES (PAID DIRECTLY FROM YOUR INVESTMENT)
                                               CLASS A    ALL R SHARE CLASSES
------------------------------------------------------------------------------

 Maximum initial sales charge on purchases      5.75%/*/         none
 (as a percentage of offering price)
------------------------------------------------------------------------------
 Maximum sales charge on reinvested dividends    none            none
------------------------------------------------------------------------------
 Maximum contingent deferred sales charge        none            none
------------------------------------------------------------------------------
 Redemption or exchange fees                     none            none




* The initial sales charge is reduced for purchases of $25,000 or more and
 eliminated for purchases of $1 million or more.




 ANNUAL FUND OPERATING EXPENSES (DEDUCTED FROM FUND ASSETS)
                                            CLASS  CLASS  CLASS  CLASS   CLASS
                                   CLASS A   R-1    R-2    R-3    R-4     R-5
-------------------------------------------------------------------------------

 Management fees/1/                 0.69%   0.69%  0.69%  0.69%  0.69%   0.69%
-------------------------------------------------------------------------------
 Distribution and/or service        0.26    0.99   0.75   0.50   0.25    none
 (12b-1) fees/2/
-------------------------------------------------------------------------------
 Other expenses                     0.23    0.38   0.83   0.41   0.27    0.20
-------------------------------------------------------------------------------
 Total annual fund operating        1.18    2.06   2.27   1.60   1.21    0.89
 expenses/1/
-------------------------------------------------------------------------------




1 The fund's investment adviser began waiving 5% of its management fees on
 September 1, 2004. Beginning April 1, 2005, this waiver increased to 10% and is
 expected to continue at this level until further review. In addition, the
 investment adviser paid a portion of the fund's transfer agent fees for certain
 R share classes. Total annual fund operating expenses do not reflect any waiver
 or reimbursement. Information regarding the effect of any waiver/reimbursement
 on total annual fund operating expenses can be found in the Financial
 Highlights table and the audited financial statements in the fund's annual
 report.
2 Class A, R-1, R-2, R-3 and R-4 12b-1 fees may not exceed .30%, 1.00%, 1.00%,
 .75% and .50%, respectively, of the class' average net assets annually.


                                       4

New World Fund / Prospectus


<PAGE>

OTHER EXPENSES
The "Other expenses" items in the table above include custodial, legal, transfer
agent and subtransfer agent/recordkeeping payments as well as various other
expenses. Subtransfer agent/recordkeeping payments may be made to third parties
(including affiliates of the fund's investment adviser) that provide
recordkeeping and other administrative services to retirement plans invested in
the fund in lieu of the transfer agent providing such services. The amount paid
for subtransfer agent/recordkeeping services will vary depending on the share
class selected and the entity receiving the payments. The table below shows the
maximum payments to affiliated and unaffiliated entities of the fund's
investment adviser providing services to retirement plans.





                PAYMENTS TO AFFILIATED       PAYMENTS TO UNAFFILIATED ENTITIES
------------           ENTITIES
            -------------------------------------------------------------------

 Class A          .05% of assets or                  .05% of assets or
            $12 per participant position*      $12 per participant position*
-------------------------------------------------------------------------------
 Class R-1          .10% of assets                     .10% of assets
-------------------------------------------------------------------------------
 Class R-2   $27 per participant position              .25% of assets
                 plus .15% of assets
-------------------------------------------------------------------------------
 Class R-3   $12 per participant position              .15% of assets
                 plus .10% of assets
 Class R-4          .10% of assets                     .10% of assets
-------------------------------------------------------------------------------
 Class R-5          .05% of assets                     .05% of assets
-------------------------------------------------------------------------------




* Payment amount depends on the date upon which services commenced.

EXAMPLES

The examples below are intended to help you compare the cost of investing in the
fund with the cost of investing in other mutual funds. The examples assume that
you invest $10,000 in the fund for the time periods indicated, that your
investment has a 5% return each year, that all dividends and capital gain
distributions are reinvested, and that the fund's operating expenses remain the
same as shown above. The examples do not reflect the impact of any fee waivers
or expense reimbursements.

Although your actual costs may be higher or lower, based on these assumptions,
your cumulative estimated expenses would be:






                               1 YEAR  3 YEARS  5 YEARS   10 YEARS
-------------------------------------------------------------------

 Class A*                       $688    $928    $1,187     $1,924
-------------------------------------------------------------------
 Class R-1                       209     646     1,108      2,390
-------------------------------------------------------------------
 Class R-2                       230     709     1,215      2,605
-------------------------------------------------------------------
 Class R-3                       163     505       871      1,900
-------------------------------------------------------------------
 Class R-4                       123     384       665      1,466
-------------------------------------------------------------------
 Class R-5                        91     284       493      1,096
-------------------------------------------------------------------




* Reflects the maximum initial sales charge in the first year.


                                       5

                                                    New World Fund / Prospectus
<PAGE>

Investment objective, strategies and risks

The fund's investment objective is long-term capital appreciation. The fund may
invest in equity securities of any company, regardless of where it is based, if
the fund's investment adviser determines that a significant portion of the
company's assets or revenues (generally 20% or more) is attributable to
developing countries. Under normal market conditions, the fund will invest at
least 35% of its assets in equity and debt securities of issuers primarily based
in qualified countries that have developing economies and/or markets. In
addition, the fund may invest up to 25% of its assets in nonconvertible debt
securities of issuers, including issuers of lower rated bonds and government
bonds, primarily based in qualified countries or that have a significant portion
of their assets or revenues attributable to developing countries. The fund may
also, to a limited extent, invest in securities of issuers based in nonqualified
developing countries.

In determining whether a country is qualified, the fund will consider such
factors as the country's per capita gross domestic product, the percentage of
the country's economy that is industrialized, market capital as a percentage of
gross domestic product, the overall regulatory environment, the presence of
government regulation limiting or banning foreign ownership, and restrictions on
repatriation of initial capital, dividends, interest and/or capital gains. The
fund's investment adviser will maintain a list of qualified countries and
securities in which the fund may invest. Qualified developing countries in which
the fund may invest currently include, but are not limited to, Argentina,
Brazil, Chile, China, Colombia, Croatia, Czech Republic, Dominican Republic,
Egypt, Hungary, India, Israel, Jordan, Malaysia, Mexico, Morocco, Panama, Peru,
Philippines, Poland, Russian Federation, South Africa, Thailand, Turkey and
Venezuela.

The prices of securities held by the fund may decline in response to certain
events, including those directly involving the companies whose securities are
owned by the fund; conditions affecting the general economy; overall market
changes; local, regional or global political, social or economic instability;
and currency and interest rate fluctuations. The growth-oriented, equity-type
securities generally purchased by the fund may involve large price swings and
potential for loss, particularly in the case of smaller capitalization stocks.
Smaller capitalization stocks are often more difficult to value or dispose of,
more difficult to obtain information about and more volatile than stocks of
larger, more established companies.
The values of most debt securities held by the fund may be affected by changing
interest rates and by changes in the effective maturities and credit ratings of
these securities. For example, the values of debt securities in the fund's
portfolio generally will decline when interest rates rise and increase when
interest rates fall. In addition, falling interest rates may cause an issuer to
redeem or "call" a security before its stated maturity, which may result in the
fund having to reinvest the proceeds in lower yielding securities. Debt
securities are also subject to credit risk, which is the possibility that the
credit strength of an issuer will weaken and/or an issuer of a debt security
will fail to make timely payments of


                                       6

New World Fund / Prospectus


<PAGE>

principal or interest and the security will go into default. Lower quality or
longer maturity debt securities generally have higher rates of interest and may
be subject to greater price fluctuations than higher quality or shorter maturity
debt securities. The fund's investment adviser attempts to reduce these risks
through diversification of the portfolio and with ongoing credit analysis of
each issuer, as well as by monitoring economic and legislative developments.

Investments in securities issued by entities based outside the United States may
be subject to the risks described above to a greater extent and may also be
affected by currency controls; different accounting, auditing, financial
reporting and legal standards and practices in some countries; expropriation;
changes in tax policy; greater market volatility; differing securities market
structures; higher transaction costs; and various administrative difficulties,
such as delays in clearing and settling portfolio transactions or in receiving
payment of dividends. These risks may be heightened in connection with
investments in developing countries.

Investing in countries with developing economies and/or markets may involve
risks in addition to and greater than those generally associated with investing
in developed countries. For instance, developing countries may have less
developed legal and accounting systems. The governments of these countries may
be more unstable and more likely to impose capital controls, nationalize a
company or industry, place restrictions on foreign ownership and on withdrawing
sale proceeds of securities from the country, and/or impose punitive taxes that
could adversely affect security prices. In addition, the economies of these
countries may be dependent on relatively few industries that are more
susceptible to local and global changes. Securities markets in these countries
are also relatively small and have substantially lower trading volumes. As a
result, securities issued in these countries may be more volatile and less
liquid than securities issued in countries with more developed economies or
markets.
The fund may also hold cash or money market instruments. The percentage of the
fund invested in such holdings will vary and depends on various factors,
including market conditions and purchases and redemptions of fund shares. A
larger percentage of such holdings could moderate the fund's investment results
in a period of rising market prices; conversely, it could reduce the magnitude
of the fund's loss in the event of falling market prices and provide liquidity
to make additional investments or to meet redemptions.

The fund relies on the professional judgment of its investment adviser to make
decisions about the fund's portfolio investments. The basic investment
philosophy of the investment adviser is to seek to invest in attractively valued
companies that, in its opinion, represent above-average long-term investment
opportunities. The investment adviser believes that an important way to
accomplish this is through fundamental analysis, which may include meeting with
company executives and employees, suppliers, customers and competitors.
Securities may be sold when the investment adviser believes that they no longer
represent relatively attractive investment opportunities.


                                       7

                                                    New World Fund / Prospectus
<PAGE>




ADDITIONAL INVESTMENT RESULTS
Unlike the Investment Results table on page 3, the table below reflects the
fund's results calculated without a sales charge.


 ADDITIONAL INVESTMENT RESULTS (WITHOUT A SALES CHARGE)
 AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDED DECEMBER 31, 2004:
                                      1 YEAR   5 YEARS    LIFETIME/1/
-----------------------------------------------------------------------

 CLASS A -- FIRST SOLD 6/17/99        20.80%    4.64%        7.82%



                                     1 YEAR   LIFETIME/1/
----------------------------------------------------------

 CLASS R-1 -- FIRST SOLD 6/11/02     19.84%     16.72%
 CLASS R-2 -- FIRST SOLD 6/7/02      19.85      16.83
 CLASS R-3 -- FIRST SOLD 6/6/02      20.31      17.35
 CLASS R-4 -- FIRST SOLD 10/7/02     20.75      32.22
 CLASS R-5 -- FIRST SOLD 5/15/02     21.10      16.26




                                     1 YEAR  5 YEARS   LIFETIME/1/
-------------------------------------------------------------------

 INDEXES
 MSCI All Country World Index/2/     15.75%  -1.79%       0.97%
 MSCI Emerging Markets Index/3/      25.95    4.62        7.48





1 Lifetime results for each share class are measured from the date the share
 class was first sold. Lifetime results for the index(es) shown are measured
 from the date Class A shares were first sold.
2 MSCI All Country World Index is a free float-adjusted market capitalization
 index that is designed to measure equity market performance in the global
 developed and emerging markets, consisting of 49 developed and emerging market
 country indexes. This index is unmanaged and includes reinvested dividends
 and/or distributions, but does not reflect sales charges, commissions, expenses
 or taxes.
3 MSCI Emerging Markets Index is a free float-adjusted market capitalization
 index that is designed to measure equity market performance in the global
 emerging markets, consisting of 26 emerging market country indexes. This index
 is unmanaged and includes reinvested dividends and/or distributions, but does
 not reflect sales charges, commissions, expenses or taxes.


                                       8



New World Fund / Prospectus


<PAGE>

[Begin pie chart]

Industry diversification as of October 31, 2005


Financials                16.21%
Bonds & notes                   10.71
Telecommunication Services10.36
Consumer Staples         8.62
Materials                        7.75
Consumer Discretionary           6.77
Other industries                26.51
Short-term securtities and
 other assets less liabilities  13.07


[End pie chart]



Because the fund is actively managed, its holdings will change over time.

For updated information on the fund's portfolio holdings, please visit us at
americanfunds.com.


                                       9

                                                    New World Fund / Prospectus
<PAGE>

Management and organization




INVESTMENT ADVISER
Capital Research and Management Company, an experienced investment management
organization founded in 1931, serves as investment adviser to the fund and other
funds, including the American Funds. Capital Research and Management Company is
a wholly owned subsidiary of The Capital Group Companies, Inc. and is located at
333 South Hope Street, Los Angeles, California 90071, and 135 South State
College Boulevard, Brea, California 92821. Capital Research and Management
Company manages the investment portfolio and business affairs of the fund. The
total management fee paid by the fund, as a percentage of average net assets,
for the previous fiscal year appears in the Annual Fund Operating Expenses table
under "Fees and expenses of the fund." A discussion regarding the basis for the
approval of the fund's investment advisory and service agreement by the fund's
Board of Directors is contained in the fund's semi-annual report to shareholders
for the period ended April 30, 2005.




EXECUTION OF PORTFOLIO TRANSACTIONS
The investment adviser places orders with broker-dealers for the fund's
portfolio transactions. The investment adviser strives to obtain best execution
for the fund's portfolio transactions, taking into account a variety of factors
to produce the most favorable total price reasonably attainable under the
circumstances. These factors include the size and type of transaction, the cost
and quality of executions, and the broker-dealer's ability to offer liquidity
and anonymity. For example, with respect to equity transactions, the fund does
not consider the investment adviser as having an obligation to obtain the lowest
available commission rate to the exclusion of price, service and qualitative
considerations. Subject to the considerations outlined above, the investment
adviser may place orders for the fund's portfolio transactions with
broker-dealers who have sold shares of funds managed by the investment adviser,
or who have provided investment research, statistical or other related services
to the investment adviser. In placing orders for the fund's portfolio
transactions, the investment adviser does not commit to any specific amount of
business with any particular broker-dealer. Subject to best execution, the
investment adviser may consider investment research, statistical or other
related services provided to the adviser in placing orders for the fund's
portfolio transactions. However, when the investment adviser places orders for
the fund's portfolio transactions, it does not give any consideration to whether
a broker-dealer has sold shares of the funds managed by the investment adviser.


PORTFOLIO HOLDINGS
Portfolio holdings information for the fund is available on the American Funds
website at americanfunds.com. To reach this information, access the lower
portion of the fund's details page on the website. A list of the fund's top 10
equity holdings updated as of each month-end is generally posted to this page
within 14 days after the end of the applicable


                                       10

New World Fund / Prospectus


<PAGE>

month. A link to the fund's complete list of publicly disclosed portfolio
holdings updated as of each calendar quarter-end is generally posted to this
page within 45 days after the end of the applicable quarter. Both lists remain
available on the website until new information for the next month or quarter is
posted. Portfolio holdings information for the fund is also contained in reports
filed with the Securities and Exchange Commission.

A description of the fund's policies and procedures regarding disclosure of
information about its portfolio holdings is available in the statement of
additional information.

MULTIPLE PORTFOLIO COUNSELOR SYSTEM

Capital Research and Management Company uses a system of multiple portfolio
counselors in managing mutual fund assets. Under this approach, the portfolio of
a fund is divided into segments managed by individual counselors. Counselors
decide how their respective segments will be invested. In addition, Capital
Research and Management Company's investment analysts may make investment
decisions with respect to a portion of a fund's portfolio. Investment decisions
are subject to the limits provided by a fund's objective(s), policies and
restrictions and the oversight of Capital Research and Management Company's
investment committee.

The primary individual portfolio counselors for New World Fund are:





                                       PRIMARY TITLE WITH      PORTFOLIO
                         PORTFOLIO     INVESTMENT ADVISER      COUNSELOR'S
 PORTFOLIO COUNSELOR/    COUNSELOR     (OR AFFILIATE)          ROLE IN
 FUND TITLE              EXPERIENCE    AND INVESTMENT          MANAGEMENT
 (IF APPLICABLE)        IN THIS FUND   EXPERIENCE              OF THE FUND
--------------------------------------------------------------------------------------

 ROBERT W. LOVELACE       7 years      Senior Vice             Serves as an equity
 President and                         President, Capital      securities portfolio
 Director                              Research and            counselor
                                       Management Company

                                       Investment
                                       professional for 21
                                       years, all with
                                       Capital Research and
                                       Management Company or
                                       affiliate
--------------------------------------------------------------------------------------
 MARK E. DENNING          7 years      Director, Capital       Serves as an equity
 Senior Vice President                 Research and            securities portfolio
                                       Management Company      counselor

                                       Investment
                                       professional for 23
                                       years, all with
                                       Capital Research and
                                       Management Company or
                                       affiliate
--------------------------------------------------------------------------------------
 DAVID C. BARCLAY         7 years      Senior Vice             Serves as a
 Vice President                        President, Capital      fixed-income securities
                                       Research and            portfolio counselor
                                       Management Company

                                       Investment
                                       professional for 25
                                       years in total; 18
                                       years with Capital
                                       Research and
                                       Management Company or
                                       affiliate
--------------------------------------------------------------------------------------
 ALWYN HEONG              7 years      Senior Vice             Serves as an equity
 Vice President                        President, Capital      securities portfolio
                                       Research Company        counselor

                                       Investment
                                       professional for 17
                                       years in total; 13
                                       years with Capital
                                       Research and
                                       Management Company or
                                       affiliate
--------------------------------------------------------------------------------------
 CARL M. KAWAJA           7 years      Senior Vice             Serves as an equity
 Vice President                        President, Capital      securities portfolio
                                       Research Company        counselor

                                       Investment
                                       professional for 18
                                       years in total; 15
                                       years with Capital
                                       Research and
                                       Management Company or
                                       affiliate
--------------------------------------------------------------------------------------






                                       11

                                                    New World Fund / Prospectus
<PAGE>

Information regarding the portfolio counselors' compensation, their ownership of
securities in the fund and other accounts they manage can be found in the
statement of additional information.

CERTAIN PRIVILEGES AND/OR SERVICES DESCRIBED ON THE FOLLOWING PAGES OF THIS
PROSPECTUS AND IN THE STATEMENT OF ADDITIONAL INFORMATION MAY NOT BE AVAILABLE
TO YOU DEPENDING ON YOUR INVESTMENT DEALER OR RETIREMENT PLAN RECORDKEEPER.



PLEASE SEE YOUR FINANCIAL ADVISER, INVESTMENT DEALER OR PLAN RECORDKEEPER FOR
MORE INFORMATION.


                                       12

New World Fund / Prospectus


<PAGE>

Purchase, exchange and sale of shares
AMERICAN FUNDS SERVICE COMPANY, THE FUND'S TRANSFER AGENT, ON BEHALF OF THE FUND
AND AMERICAN FUNDS DISTRIBUTORS, THE FUND'S DISTRIBUTOR, IS REQUIRED BY LAW TO
OBTAIN CERTAIN PERSONAL INFORMATION FROM YOU OR ANY OTHER PERSON(S) ACTING ON
YOUR BEHALF IN ORDER TO VERIFY YOUR OR SUCH PERSON'S IDENTITY. IF YOU DO NOT
PROVIDE THE INFORMATION, THE TRANSFER AGENT MAY NOT BE ABLE TO OPEN YOUR
ACCOUNT. IF THE TRANSFER AGENT IS UNABLE TO VERIFY YOUR IDENTITY OR THAT OF ANY
OTHER PERSON(S) AUTHORIZED TO ACT ON YOUR BEHALF, OR BELIEVES IT HAS IDENTIFIED
POTENTIALLY CRIMINAL ACTIVITY, THE FUND AND AMERICAN FUNDS DISTRIBUTORS RESERVE
THE RIGHT TO CLOSE YOUR ACCOUNT OR TAKE SUCH OTHER ACTION THEY DEEM REASONABLE
OR REQUIRED BY LAW.

PURCHASES AND EXCHANGES

Eligible retirement plans generally may open an account and purchase Class A or
R shares by contacting any investment dealer (who may impose transaction charges
in addition to those described in this prospectus) authorized to sell the fund's
shares. Some or all R share classes may not be available through certain
investment dealers. Additional shares may be purchased through a plan's
administrator or recordkeeper.

Class A shares are generally not available for retirement plans using the
PlanPremier/(R)/ or Recordkeeper Direct/(R)/ recordkeeping programs.
Class R shares generally are available only to 401(k) plans, 457 plans,
employer-sponsored 403(b) plans, profit-sharing and money purchase pension
plans, defined benefit plans and nonqualified deferred compensation plans. Class
R shares also are generally available only to retirement plans where plan level
or omnibus accounts are held on the books of the fund. In addition, Class R-5
shares generally are available only to retirement plans with $1 million or more
in plan assets. Class R shares generally are not available to retail
nonretirement accounts, Traditional and Roth Individual Retirement Accounts
(IRAs), Coverdell Education Savings Accounts, SEPs, SARSEPs, SIMPLE IRAs,
individual 403(b) plans and 529 college savings plans, such as
CollegeAmerica./(R)/ CollegeAmerica is sponsored by and is a registered
trademark of the Virginia College Savings Plan,/SM /an agency of the
Commonwealth of Virginia.

Shares of the fund offered through this prospectus generally may be exchanged
into shares of the same class of other American Funds. Exchanges of Class A
shares from American Funds money market funds purchased without a sales charge
generally will be subject to the appropriate sales charge.


                                       13

                                                    New World Fund / Prospectus
<PAGE>

FREQUENT TRADING OF FUND SHARES
The fund and American Funds Distributors reserve the right to reject any
purchase order for any reason. The fund is not designed to serve as a vehicle
for frequent trading in response to short-term fluctuations in the securities
markets. Accordingly, purchases, including those that are part of exchange
activity, that the fund or American Funds Distributors has determined could
involve actual or potential harm to the fund may be rejected. Frequent trading
of fund shares may lead to increased costs to the fund and less efficient
management of the fund's portfolio, resulting in dilution of the value of the
shares held by long-term shareholders.

The fund's Board of Directors has adopted policies and procedures with respect
to frequent purchases and redemptions of fund shares. Under the fund's "purchase
blocking policy," any shareholder redeeming shares (including redemptions that
are part of an exchange transaction) having a value of $5,000 or more from the
fund will be precluded from investing in the fund (including investments that
are part of an exchange transaction) for 30 calendar days after the redemption
transaction. This prohibition will not apply to redemptions by shareholders
whose shares are held on the books of third-party intermediaries that have not
adopted procedures to implement this policy. American Funds Service Company will
work with intermediaries to develop such procedures or other procedures that
American Funds Service Company determines are reasonably designed to achieve the
objective of the purchase blocking policy. At the time the intermediaries adopt
these procedures, shareholders whose accounts are on the books of such
intermediaries will be subject to this purchase blocking policy or another
frequent trading policy that achieves the objective of the purchase blocking
policy. There is no guarantee that all instances of frequent trading in fund
shares will be prevented.

Under the fund's purchase blocking policy, certain purchases will not be
prevented and certain redemptions will not trigger a purchase block, such as:
systematic redemptions and purchases where the entity maintaining the
shareholder account is able to identify the transaction as a systematic
redemption or purchase; purchases and redemptions of shares having a value of
less than $5,000; retirement plan contributions, loans and distributions
(including hardship withdrawals) identified as such on the retirement plan
recordkeeper's system; and purchase transactions involving transfers of assets,
rollovers, Roth IRA conversions and IRA re-characterizations, where the entity
maintaining the shareholder account is able to identify the transaction as one
of these types of transactions. The statement of additional information contains
more information about how American Funds Service Company may address other
potentially abusive trading activity in the American Funds.

SALES

Please contact your plan administrator or recordkeeper in order to sell shares
from your retirement plan.


                                       14

New World Fund / Prospectus


<PAGE>

If you notify American Funds Service Company, you may reinvest proceeds from a
redemption, dividend payment or capital gain distribution without a sales charge
in the same fund or other American Funds within 90 days after the date of the
redemption or distribution. Proceeds will be reinvested in the same share class
from which the original redemption or distribution was made. Redemption proceeds
of Class A shares representing direct purchases in American Funds money market
funds that are reinvested in non-money market American Funds will be subject to
a sales charge. Proceeds will be reinvested at the next calculated net asset
value after your request is received and accepted by American Funds Service
Company. You may not reinvest proceeds in the American Funds as described in
this paragraph if such proceeds are subject to a purchase block as described
under "Frequent trading of fund shares." This paragraph does not apply to
rollover investments as described under "Rollovers from retirement plans to
IRAs."




VALUING SHARES
The net asset value of each share class of the fund is the value of a single
share. The fund calculates the net asset value each day the New York Stock
Exchange is open as of approximately 4:00 p.m. New York time, the normal close
of regular trading. Assets are valued primarily on the basis of market
quotations. However, the fund has adopted procedures for making "fair value"
determinations if market quotations are not readily available or are not
considered reliable. For example, if events occur between the close of markets
outside the United States and the close of regular trading on the New York Stock
Exchange that, in the opinion of the investment adviser, materially affect the
value of the fund's securities that principally trade in those international
markets, the securities will be valued in accordance with fair value procedures.
Use of these procedures is intended to result in more appropriate net asset
values. In addition, such use will reduce, if not eliminate, potential arbitrage
opportunities otherwise available to short-term investors.

Because the fund may hold securities that are primarily listed on foreign
exchanges that trade on weekends or days when the fund does not price its
shares, the value of securities held in the fund may change on days when you
will not be able to purchase or redeem fund shares.

Your shares will be purchased at the net asset value (plus any applicable sales
charge in the case of Class A shares) or sold at the net asset value next
determined after American Funds Service Company receives and accepts your
request.


                                       15

                                                    New World Fund / Prospectus
<PAGE>

Sales charges

CLASS A SHARES

The initial sales charge you pay each time you buy Class A shares differs
depending upon the amount you invest and may be reduced or eliminated for larger
purchases as indicated below. The "offering price," the price you pay to buy
shares, includes any applicable sales charge, which will be deducted directly
from your investment. Shares acquired through reinvestment of dividends or
capital gain distributions are not subject to an initial sales charge.





                              SALES CHARGE AS A
                                         PERCENTAGE OF:
                                                                 DEALER
                                                   NET         COMMISSION
                                       OFFERING   AMOUNT     AS A PERCENTAGE
 INVESTMENT                             PRICE    INVESTED   OF OFFERING PRICE
------------------------------------------------------------------------------

 Less than $25,000                      5.75%     6.10%           5.00%
------------------------------------------------------------------------------
 $25,000 but less than $50,000          5.00      5.26            4.25
------------------------------------------------------------------------------
 $50,000 but less than $100,000         4.50      4.71            3.75
------------------------------------------------------------------------------
 $100,000 but less than $250,000        3.50      3.63            2.75
------------------------------------------------------------------------------
 $250,000 but less than $500,000        2.50      2.56            2.00
------------------------------------------------------------------------------
 $500,000 but less than $750,000        2.00      2.04            1.60
------------------------------------------------------------------------------
 $750,000 but less than $1 million      1.50      1.52            1.20
------------------------------------------------------------------------------
 $1 million or more and certain other   none      none      see below
 investments described below
------------------------------------------------------------------------------




The sales charge, expressed as a percentage of the offering price or the net
amount invested, may be higher or lower than the percentages described in the
table above due to rounding. This is because the dollar amount of the sales
charge is determined by subtracting the net asset value of the shares purchased
from the offering price, which is calculated to two decimal places using
standard rounding criteria. The impact of rounding will vary with the size of
the investment and the net asset value of the shares.

CLASS A PURCHASES NOT SUBJECT TO SALES CHARGES
The following investments are not subject to any initial or contingent deferred
sales charge if American Funds Service Company is properly notified of the
nature of the investment:

. investments made by accounts that are part of certain qualified fee-based
 programs and that purchased Class A shares before March 15, 2001; and

. certain rollover investments from retirement plans to IRAs (see "Rollovers
 from retirement plans to IRAs" below for more information).


                                       16

New World Fund / Prospectus


<PAGE>

The distributor may pay dealers up to 1% on investments made in Class A shares
with no initial sales charge. The fund may reimburse the distributor for these
payments through its plans of distribution (see "Plans of distribution" below).

Certain other investors may qualify to purchase shares without a sales charge,
such as employees of investment dealers and registered investment advisers
authorized to sell American Funds, and employees of The Capital Group Companies.
Please see the statement of additional information for more information.

 EMPLOYER-SPONSORED RETIREMENT PLANS

 Employer-sponsored retirement plans not currently invested in Class A shares
 and wishing to invest without a sales charge are not eligible to purchase Class
 A shares. Such plans may invest only in Class R shares.

 Provided that the plan's recordkeeper can properly apply a sales charge on the
 plan's investments, an employer-sponsored retirement plan not currently
 invested in Class A shares and wishing to invest less than $1 million may
 invest in Class A shares, but the purchase of these shares will be subject to
 the applicable sales charge. An employer-sponsored retirement plan that
 purchases Class A shares with a sales charge will be eligible to purchase
 additional Class A shares in accordance with the sales charge table above. If
 the recordkeeper cannot properly apply a sales charge on the plan's
 investments, then the plan may invest only in Class R shares.
 Employer-sponsored retirement plans not currently invested in Class A shares,
 or that are currently investing in Class A shares with a sales charge, are not
 eligible to establish a statement of intention that qualifies them to purchase
 Class A shares without a sales charge. More information about statements of
 intention can be found under "Sales charge reductions."

 Employer-sponsored retirement plans that invested in Class A shares without any
 sales charge on or before March 31, 2004, and that continue to meet the
 eligibility requirements in effect as of that date for purchasing Class A
 shares at net asset value, may continue to purchase Class A shares without any
 initial or contingent deferred sales charge.

CLASS R SHARES

Class R shares are sold without any initial or contingent deferred sales charge.
The distributor will pay dealers annually an asset-based compensation of 1.00%
for sales of Class R-1 shares, .75% for Class R-2 shares, .50% for Class R-3
shares and .25% for Class R-4 shares. No dealer compensation is paid on sales of
Class R-5 shares. The fund may reimburse the distributor for these payments
through its plans of distribution (see "Plans of distribution" below).


                                       17

                                                    New World Fund / Prospectus
<PAGE>

Sales charge reductions

TO RECEIVE A REDUCTION IN YOUR CLASS A INITIAL SALES CHARGE, YOU MUST LET YOUR
FINANCIAL ADVISER OR AMERICAN FUNDS SERVICE COMPANY KNOW AT THE TIME YOU
PURCHASE SHARES THAT YOU QUALIFY FOR SUCH A REDUCTION. IF YOU DO NOT LET YOUR
ADVISER OR AMERICAN FUNDS SERVICE COMPANY KNOW THAT YOU ARE ELIGIBLE FOR A
REDUCTION, YOU MAY NOT RECEIVE A SALES CHARGE DISCOUNT TO WHICH YOU ARE
OTHERWISE ENTITLED. In order to determine your eligibility to receive a sales
charge discount, it may be necessary for you to provide your adviser or American
Funds Service Company with information and records (including account
statements) of all relevant accounts invested in the American Funds.

REDUCING YOUR CLASS A INITIAL SALES CHARGE

Consistent with the policies described in this prospectus, two or more
retirement plans of an employer or employer's affiliates may combine all of
their American Funds investments to reduce their Class A sales charge. However,
for this purpose, investments representing direct purchases of American Funds
money market funds are excluded.

 CONCURRENT PURCHASES

 Simultaneous purchases of any class of shares of two or more American Funds may
 be combined to qualify for a reduced Class A sales charge.

 RIGHTS OF ACCUMULATION
 You have the right to take into account your accumulated holdings in all share
 classes of the American Funds to determine the initial sales charge you pay on
 each purchase of Class A shares. Subject to your investment dealer's or
 recordkeeper's capabilities, your accumulated holdings will be calculated as
 the higher of (a) the current value of your existing holdings or (b) the amount
 you invested (excluding capital appreciation) less any withdrawals. Please see
 the statement of additional information for details. You should retain any
 records necessary to substantiate the historical amounts you have invested. The
 current value of existing investments in an American Legacy/(R)/ Retirement
 Investment Plan may also be taken into account to determine your Class A sales
 charge.

 STATEMENT OF INTENTION
 You may reduce your Class A sales charge by establishing a statement of
 intention. A statement of intention allows all American Funds non-money market
 fund purchases of all share classes intended to be made over a 13-month period
 to be combined in order to determine the applicable sales charge; however,
 investments made under a right of reinvestment, appreciation of your
 investment, and reinvested dividends and capital gains do not apply toward
 these combined purchases. At the request of a plan, purchases made during the
 previous 90 days may be included. A portion of the account may be held in
 escrow to cover additional Class A sales charges that may be due if total
 investments over the 13-month period do not qualify for the applicable sales
 charge


                                       18

New World Fund / Prospectus


<PAGE>

 reduction. Employer-sponsored retirement plans may be restricted from
 establishing statements of intention. See "Sales charges" above for more
 information.

RIGHT OF REINVESTMENT

Please see the "Sales" section of "Purchase, exchange and sale of shares" above
for information on how to reinvest proceeds from a redemption, dividend payment
or capital gain distribution without a sales charge.

YOU MAY OBTAIN MORE INFORMATION ABOUT SALES CHARGE REDUCTIONS THROUGH A LINK ON
THE HOME PAGE OF THE AMERICAN FUNDS WEBSITE AT AMERICANFUNDS.COM, FROM THE
STATEMENT OF ADDITIONAL INFORMATION OR FROM YOUR FINANCIAL ADVISER.

Rollovers from retirement plans to IRAs
Assets from retirement plans may be invested in Class A, B, C or F shares
through an IRA rollover. More information on Class B, C and F shares can be
found in the fund's prospectus for non-retirement plan shareholders. Rollovers
invested in Class A shares from retirement plans will be subject to applicable
sales charges. The following rollovers to Class A shares will be made at no
sales charge:

. rollovers to IRAs from 403(b) plans with Capital Bank and Trust Company as
 custodian; and

. rollovers to IRAs that are attributable to American Funds investments, if they
 meet the following three requirements:

 -- the retirement plan from which assets are being rolled over is part of an
   American Funds proprietary retirement plan program (such as PlanPremier,
   Recordkeeper Direct or Recordkeeper Connect/(R)/) or is a plan whose
   participant subaccounts are serviced by American Funds Service Company;

 -- the plan's assets were invested in American Funds at the time of
   distribution; and

 -- the plan's assets are rolled over to an American Funds IRA with Capital Bank
   and Trust Company as custodian.

IRA rollover assets that roll over at no sales charge as described above will
not be subject to a contingent deferred sales charge and investment dealers will
be compensated solely with an annual service fee that begins to accrue
immediately. IRA rollover assets that are not attributable to American Funds
investments, as well as future contributions to the IRA, will be subject to
sales charges and the terms and conditions generally applicable to Class A share
investments as described in the prospectus and statement of additional
information if invested in Class A shares.

TRANSFERS TO IRAS

Transfers to IRAs that are attributable to American Funds investments held in
SIMPLE IRAs, SEPs or SARSEPs will not be subject to a sales charge if invested
in Class A shares.


                                       19

                                                    New World Fund / Prospectus
<PAGE>

Plans of distribution
The fund has plans of distribution or "12b-1 plans" under which it may finance
activities primarily intended to sell shares, provided the categories of
expenses are approved in advance by the fund's Board of Directors. The plans
provide for payments, based on annualized percentages of average daily net
assets, of up to .30% for Class A shares, up to 1.00% for Class R-1 and R-2
shares, up to .75% for Class R-3 shares and up to .50% for Class R-4 shares. For
all share classes, up to .25% of these expenses may be used to pay service fees
to qualified dealers for providing certain shareholder services. The amount
remaining for each share class may be used for distribution expenses.

The 12b-1 fees paid by the fund, as a percentage of average net assets, for the
previous fiscal year are indicated in the Annual Fund Operating Expenses table
under "Fees and expenses of the fund." Since these fees are paid out of the
fund's assets or income on an ongoing basis, over time they will increase the
cost and reduce the return of your investment.

Other compensation to dealers
American Funds Distributors, at its expense, currently provides additional
compensation to investment dealers. These payments may be made, at the
discretion of American Funds Distributors, to the top 75 dealers who have sold
shares of the American Funds. The level of payments made to a qualifying dealer
in any given year will vary and in no case would exceed the sum of (a) .10% of
the previous year's American Funds sales by that dealer and (b) .02% of American
Funds assets attributable to that dealer. For calendar year 2004, aggregate
payments made by American Funds Distributors to dealers were less than .02% of
the assets of the American Funds. Aggregate payments may also change from year
to year. A number of factors will be considered in determining payments,
including the qualifying dealer's sales, assets and redemption rates, and the
quality of the dealer's relationship with American Funds Distributors. American
Funds Distributors makes these payments to help defray the costs incurred by
qualifying dealers in connection with efforts to educate financial advisers
about the American Funds so that they can make recommendations and provide
services that are suitable and meet shareholder needs. American Funds
Distributors will, on an annual basis, determine the advisability of continuing
these payments. American Funds Distributors may also pay expenses associated
with meetings conducted by dealers outside the top 75 firms to facilitate
educating financial advisers and shareholders about the American Funds.


                                       20

New World Fund / Prospectus


<PAGE>

Distributions and taxes




DIVIDENDS AND DISTRIBUTIONS

The fund intends to distribute dividends to you, usually in December.

Capital gains, if any, are usually distributed in December. When a dividend or
capital gain is distributed, the net asset value per share is reduced by the
amount of the payment.

All dividends and capital gain distributions paid to retirement plan
shareholders will be automatically reinvested.




TAXES ON DIVIDENDS AND DISTRIBUTIONS

Dividends and capital gains distributed by the fund to tax-deferred retirement
plan accounts are not taxable currently.

TAXES ON TRANSACTIONS
Exchanges within a tax-deferred retirement plan account will not result in a
capital gain or loss for federal or state income tax purposes. With limited
exceptions, distributions taken from a retirement plan account are taxable as
ordinary income.

PLEASE SEE YOUR TAX ADVISER FOR MORE INFORMATION.


                                       21

                                                    New World Fund / Prospectus
<PAGE>

Financial highlights/1/

The Financial Highlights table is intended to help you understand the fund's
results for the past five fiscal years. Certain information reflects financial
results for a single share of a particular class. The total returns in the table
represent the rate that an investor would have earned or lost on an investment
in the fund (assuming reinvestment of all dividends and capital gain
distributions). This information has been audited by Deloitte & Touche LLP,
whose report, along with the fund's financial statements, is included in the
statement of additional information, which is available upon request.



                                                 INCOME (LOSS) FROM INVESTMENT OPERATIONS/2/


                                                                       Net
                                                                 gains (losses)
                                      Net asset                   on securities
                                       value,         Net        (both realized   Total from
                                      beginning    investment          and        investment
                                      of period  income (loss)     unrealized)    operations
-----------------------------------------------------------------------------------------------

CLASS A:
Year ended 10/31/2005                  $29.68        $.68            $ 6.51         $ 7.19
Year ended 10/31/2004                   25.60         .47              4.20           4.67
Year ended 10/31/2003                   18.90         .39              6.56           6.95
Year ended 10/31/2002                   19.04         .34               .07            .41
Year ended 10/31/2001                   22.81         .47             (3.87)         (3.40)
-----------------------------------------------------------------------------------------------
CLASS R-1:
Year ended 10/31/2005                   29.22         .40              6.41           6.81
Year ended 10/31/2004                   25.33         .25              4.14           4.39
Year ended 10/31/2003                   18.85         .23              6.50           6.73
Period from 6/11/2002 to 10/31/2002     22.44         .01             (3.60)         (3.59)
-----------------------------------------------------------------------------------------------
CLASS R-2:
Year ended 10/31/2005                   29.21         .41              6.40           6.81
Year ended 10/31/2004                   25.34         .25              4.14           4.39
Year ended 10/31/2003                   18.86         .22              6.51           6.73
Period from 6/7/2002 to 10/31/2002      22.37        (.02 )           (3.49)         (3.51)
-----------------------------------------------------------------------------------------------
CLASS R-3:
Year ended 10/31/2005                   29.53         .55              6.47           7.02
Year ended 10/31/2004                   25.56         .36              4.18           4.54
Year ended 10/31/2003                   18.96         .30              6.56           6.86
Period from 6/6/2002 to 10/31/2002      22.41         .03             (3.48)         (3.45)
-----------------------------------------------------------------------------------------------
CLASS R-4:
Year ended 10/31/2005                  $29.72        $.68            $ 6.49         $ 7.17
Year ended 10/31/2004                   25.68         .47              4.20           4.67
Year ended 10/31/2003                   18.90         .39              6.57           6.96
Period from 10/7/2002 to 10/31/2002     18.21          --/6/            .69            .69
-----------------------------------------------------------------------------------------------
CLASS R-5:
Year ended 10/31/2005                   29.76         .78              6.51           7.29
 Year ended 10/31/2004                  25.66         .55              4.20           4.75
 Year ended 10/31/2003                  18.93         .46              6.57           7.03
 Period from 5/15/2002 to 10/31/2002    23.05         .12             (4.24)         (4.12)









                                      Dividends
                                      (from net     Net asset
                                      investment  value, end of    Total
                                       income)       period      return/3/
----------------------------------------------------------------------------

CLASS A:
Year ended 10/31/2005                   $(.55)       $36.32        24.50%
Year ended 10/31/2004                    (.59)        29.68        18.51
Year ended 10/31/2003                    (.25)        25.60        37.19
Year ended 10/31/2002                    (.55)        18.90         1.95
Year ended 10/31/2001                    (.37)        19.04       (15.13)
----------------------------------------------------------------------------
CLASS R-1:
Year ended 10/31/2005                    (.39)        35.64        23.51
Year ended 10/31/2004                    (.50)        29.22        17.57
Year ended 10/31/2003                    (.25)        25.33        36.07
Period from 6/11/2002 to 10/31/2002        --         18.85       (16.00)
----------------------------------------------------------------------------
CLASS R-2:
Year ended 10/31/2005                    (.40)        35.62        23.53
Year ended 10/31/2004                    (.52)        29.21        17.58
Year ended 10/31/2003                    (.25)        25.34        36.09
Period from 6/7/2002 to 10/31/2002         --         18.86       (15.69)
----------------------------------------------------------------------------
CLASS R-3:
Year ended 10/31/2005                    (.48)        36.07        24.02
Year ended 10/31/2004                    (.57)        29.53        18.03
Year ended 10/31/2003                    (.26)        25.56        36.63
Period from 6/6/2002 to 10/31/2002         --         18.96       (15.39)
----------------------------------------------------------------------------
CLASS R-4:
Year ended 10/31/2005                   $(.56)       $36.33        24.44%
Year ended 10/31/2004                    (.63)        29.72        18.48
Year ended 10/31/2003                    (.18)        25.68        37.14
Period from 10/7/2002 to 10/31/2002        --         18.90         3.79
----------------------------------------------------------------------------
CLASS R-5:
Year ended 10/31/2005                    (.62)        36.43        24.83
 Year ended 10/31/2004                   (.65)        29.76        18.83
 Year ended 10/31/2003                   (.30)        25.66        37.60
 Period from 5/15/2002 to 10/31/2002       --         18.93       (17.87)


                                                      Ratio of     Ratio of
                                                      expenses     expenses
                                                     to average   to average
                                                     net assets   net assets
                                       Net assets,     before        after      Ratio of net
                                         end of         reim-        reim-      income (loss)
                                         period      bursements/  bursements/    to average
                                      (in millions)    waivers    waivers/4/     net assets
----------------------------------------------------------------------------------------------

CLASS A:
Year ended 10/31/2005                    $4,195         1.18%        1.12%         2.00 %
Year ended 10/31/2004                     2,212         1.23         1.22          1.68
Year ended 10/31/2003                     1,528         1.31         1.31          1.86
Year ended 10/31/2002                     1,071         1.34         1.34          1.65
Year ended 10/31/2001                     1,053         1.29         1.29          2.15
----------------------------------------------------------------------------------------------
CLASS R-1:
Year ended 10/31/2005                         3         2.06         1.92          1.19
Year ended 10/31/2004                         2         2.16         2.04           .92
Year ended 10/31/2003                        --/5/      2.84         2.10          1.05
Period from 6/11/2002 to 10/31/2002          --/5/      3.49          .81           .06
----------------------------------------------------------------------------------------------
CLASS R-2:
Year ended 10/31/2005                        47         2.27         1.89          1.23
Year ended 10/31/2004                        17         2.57         2.00           .91
Year ended 10/31/2003                         6         2.69         2.06           .98
Period from 6/7/2002 to 10/31/2002            1         1.04          .83          (.11 )
----------------------------------------------------------------------------------------------
CLASS R-3:
Year ended 10/31/2005                        41         1.60         1.51          1.62
Year ended 10/31/2004                        16         1.70         1.62          1.30
Year ended 10/31/2003                         6         1.84         1.68          1.37
Period from 6/6/2002 to 10/31/2002            1          .77          .68           .13
----------------------------------------------------------------------------------------------
CLASS R-4:
Year ended 10/31/2005                    $   14         1.21%        1.15%         1.98 %
Year ended 10/31/2004                         3         1.29         1.27          1.66
Year ended 10/31/2003                         1         1.43         1.33          1.79
Period from 10/7/2002 to 10/31/2002          --/5/       .13          .09            --/7/
----------------------------------------------------------------------------------------------
CLASS R-5:
Year ended 10/31/2005                       187          .89          .84          2.28
 Year ended 10/31/2004                       87          .95          .94          1.96
 Year ended 10/31/2003                       45         1.01         1.01          2.15
 Period from 5/15/2002 to 10/31/2002         27          .46          .46           .62






                                       22

New World Fund / Prospectus


<PAGE>




                                          YEAR ENDED OCTOBER 31
                           2005        2004        2003        2002         2001
------------------------------------------------------------------------------------

 PORTFOLIO TURNOVER
RATE FOR ALL CLASSES       26%         20%         30%         32%          40%
OF SHARES





1 Based on operations for the period shown (unless otherwise noted) and,
 accordingly, may not be representative of a full year.
2 Based on average shares outstanding.
3 Total returns exclude all sales charges.
4 The ratios in this column reflect the impact, if any, of certain
 reimbursements/waivers from Capital Research and Management Company. See the
 Annual Fund Operating Expenses table under "Fees and expenses of the fund" and
 the audited financial statements in the fund's annual report for more
 information.
5 Amount less than $1 million.
6 Amount less than one cent.
7 Amount less than .01 percent.
                                                    New World Fund / Prospectus


                                       23

<PAGE>

NOTES


                                       24

New World Fund / Prospectus


<PAGE>

NOTES


                                       25

                                                    New World Fund / Prospectus
<PAGE>

NOTES


                                       26

New World Fund / Prospectus


<PAGE>

NOTES


                                       27



                                                    New World Fund / Prospectus

<PAGE>



[logo - American Funds /(R)/]              The right choice for the long term/(R)/





          FOR SHAREHOLDER SERVICES         American Funds Service Company
                                           800/421-0180
          FOR RETIREMENT PLAN SERVICES     Call your employer or plan administrator
          FOR DEALER SERVICES              American Funds Distributors
                                           800/421-9900
                                           americanfunds.com
          FOR 24-HOUR INFORMATION          For Class R share information,visit
                                           AmericanFundsRetirement.com


          Telephone calls you have with the American Funds
          organization may be monitored or recorded for
          quality-assurance, verification and/or recordkeeping
          purposes. By speaking with us on the telephone, you are
          giving your consent to such monitoring and recording.
-----------------------------------------------------------------------------------



MULTIPLE TRANSLATIONS  This prospectus may be translated into other languages.
If there is any inconsistency or ambiguity as to the meaning of any word or
phrase in a translation, the English text will prevail.

ANNUAL/SEMI-ANNUAL REPORT TO SHAREHOLDERS  The shareholder reports contain
additional information about the fund, including financial statements,
investment results, portfolio holdings, a discussion of market conditions and
the fund's investment strategies, and the independent registered public
accounting firm's report (in the annual report).



STATEMENT OF ADDITIONAL INFORMATION (SAI) AND CODES OF ETHICS The current SAI,
as amended from time to time, contains more detailed information on all aspects
of the fund, including the fund's financial statements, and is incorporated by
reference into this prospectus. This means that the current SAI, for legal
purposes, is part of this prospectus. The codes of ethics describe the personal
investing policies adopted by the fund and the fund's investment adviser and its
affiliated companies.

The codes of ethics and current SAI are on file with the Securities and Exchange
Commission (SEC). These and other related materials about the fund are available
for review or to be copied at the SEC's Public Reference Room in Washington, DC
(202/942-8090) or on the EDGAR database on the SEC's website at www.sec.gov or,
after payment of a duplicating fee, via e-mail request to publicinfo@sec.gov or
by writing to the SEC's Public Reference Section, Washington, DC 20549-0102. The
current SAI is also available on americanfunds.com.

HOUSEHOLD MAILINGS Each year you are automatically sent an updated prospectus
and annual and semi-annual reports for the fund. You may also occasionally
receive proxy statements for the fund. In order to reduce the volume of mail you
receive, when possible, only one copy of these documents will be sent to
shareholders who are part of the same family and share the same residential address.

If you would like to opt out of household mailings or receive a complimentary
copy of the current SAI, codes of ethics or annual/semi-annual report to
shareholders, please call American Funds Service Company at 800/421-0180 or
write to the Secretary of the fund at 333 South Hope Street, Los Angeles,
California 90071.


[recycle bug logo]







Printed on recycled paper
RPGEPR-936-0106P Litho in USA              Investment Company File No. 811-9105
CGD/RRD/8041
-------------------------------------------------------------------------------
THE CAPITAL GROUP COMPANIES
American Funds Capital Research and Management   Capital International  Capital Guardian   Capital Bank and Trust

New World Fund, Inc.

Part C

Other Information

Item 23. Exhibits for Registration Statement (1940 Act No. 811-9105 and 1933 Act. No. 33-67455)

(a)	Articles of Incorporation - previously filed (see Pre-Effective Amendment No. 1 filed 3/3/99; Articles Supplementary - previously filed (see Post-Effective (“P/E”) Amendment No. 3 filed 3/10/00; No. 5 filed 3/12/01; and No. 6 filed 2/14/02).

(b)	By-laws as amended 6/2/05

(c)	Form of share certificate - previously filed (see P/E Amendment No. 5 filed 3/12/01)

(d)	Amended Investment Advisory and Service Agreement dated 3/10/05

(e)

Form of Amended and Restated Principal Underwriting Agreement - previously filed (see P/E Amendment No. 6 filed 2/14/02); and Form of Selling Group Agreement; form of Banking Selling Group Agreement; form of Omnibus addendum to the Selling Group Agreement (for retirement plan share classes (R shares) only); and form of Institutional Selling Group Agreement (see P/E Amendment No. 10 filed 12/29/04)

(f)	Bonus or Profit Sharing Contracts - Deferred Compensation Plan amended 1/1/04 -previously filed (see P/E Amendment No. 10 filed 12/29/04)

(g)	Form of Global Custody Agreement - previously filed (see P/E Amendment No. 7 filed 5/13/02) and form of JPMorgan Chase Supplemental Agreement dated 10/1/04 (see P/E Amendment No. 10 filed 12/29/04)

(h-1)

Other material contracts - Form of Amended and Restated Administrative Services Agreement dated 10/1/05

(h-2)

Form of Amended Shareholder Services Agreement as of 4/1/03 - previously filed (see P.E Amendment No. 10 filed 12/29/04) and form of Indemnification Agreement dated 7/1/04 (see P/E Amendment No. 10 filed 12/29/04)

(i)	Legal opinion - previously filed (see P/E Amendment No. 7 filed 5/13/02)

(j)	Consent of Independent Registered Public Accounting Firm

(k)

None

(l)	Initial capital agreements - previously filed (see Pre-Effective Amendment No. 3 filed 4/16/99)

(m)

Forms of Plans of Distribution - Class A Plan of Distribution - previously filed (see P/E Amendment No. 3 filed 4/16/99; Class 529-A - previously filed (see P/E Amendment No. 6 filed 2/14/02); Amended Plans of Distribution for Classes B, C, F, 529-B, 529-C, 529-E, 529-F and R-1, R-2, R-3 and R-4 dated 10/1/05)

(n)	Form of Amended and Restated Multiple Class Plan - previously filed (see P/E Amendment No. 6 filed 2/14/02)

(o)

Reserved

(p-1)

Code of Ethics for The Capital Group Companies dated July 2005

(p-2)

Code of Ethics for Registrant dated December 2004 - previously filed (see P/E Amendment No. 10 filed 12/29/04)

Item 24. Persons Controlled by or under Common Control with the Fund

None

Item 25. Indemnification

The Registrant is a joint-insured under Investment Adviser/Mutual Fund Errors and Omissions Policies, which insure its officers and directors against certain liabilities. However, in no event will Registrant maintain insurance to indemnify any such person for any act for which Registrant itself is not permitted to indemnify the individual.

Subsection (b) of Section 2-418 of the General Corporation Law of Maryland empowers a corporation to indemnify any person who was or is party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that he is or was a director, officer, employee or agent of the corporation or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or enterprise, against reasonable expenses (including attorneys' fees), judgments, penalties, fines and amounts paid in settlement actually incurred by him in connection with such action, suit or proceeding unless it is established that: (i) the act or omission of the person was material to the matter giving rise to the proceeding and was committed in bad faith or was the result of active and deliberate dishonesty; (ii) the person actually received an improper personal benefit of money, property or services; or (iii) with respect to any criminal action or proceeding, the person had reasonable cause to believe his act or omission was unlawful.

Indemnification under subsection (b) of Section 2-418 may not be made by a corporation unless authorized for a specific proceeding after a determination has been made that indemnification is permissible in the circumstances because the party to be indemnified has met the standard of conduct set forth in subsection (b). This determination shall be made (i) by the Board of Directors by a majority vote of a quorum consisting of directors not, at the time, parties to the proceeding, or, if such quorum cannot be obtained, then by a majority vote of a committee of the Board consisting solely of two or more directors not, at the time, parties to such proceeding and who were duly designated to act in the matter by a majority vote of the full Board in which the designated directors who are parties may participate; (ii) by special legal counsel selected by the Board of Directors of a committee of the Board by vote as set forth in subparagraph (i), or, if the requisite quorum of the full Board cannot be obtained therefor and the committee cannot be established, by a majority vote of the full Board in which any director who is a party may participate; or (iii) by the stockholders (except that shares held by any party to the specific proceeding may not be voted). A court of appropriate jurisdiction may also order indemnification if the court determines that a person seeking indemnification is entitled to reimbursement under subsection (b).

Section 2-418 further provides that indemnification provided for by Section 2-418 shall not be deemed exclusive of any rights to which the indemnified party may be entitled; that the scope of indemnification extends to directors, officers, employees or agents of a constituent corporation absorbed in a consolidation or merger and persons serving in that capacity at the request of the constituent corporation for another; and empowers the corporation to purchase and maintain insurance on behalf of a director, officer, employee or agent of the corporation against any liability asserted against or incurred by such person in any such capacity or arising out of such person's status as such whether or not the corporation would have the power to indemnify such person against such liabilities under Section 2-418.

Article VIII of the Registrant's Articles of Incorporation and Article V of the Registrant’s By-Laws as well as the indemnification agreements that the Registrant has entered into with each of its directors who is not an “interested person” of the Registrant (as defined under the Investment Company Act of 1940), provide in effect that the Registrant will indemnify its officers and directors against any liability or expenses actually and reasonably incurred by such person in any proceeding arising out of or in connection with his or her service to the Registrant, to the fullest extent permitted by applicable law, subject to certain conditions. In accordance with Section 17(h) and 17(i) of the Investment Company Act of 1940 and their respective terms, these provisions do not protect any person against any liability to the Registrant or its shareholders to which such person would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence, or reckless disregard of the duties involved in the conduct of his or her office.

Insofar as indemnification for liability arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

Registrant will comply with the indemnification requirements contained in the Investment Company Act of 1940, as amended, and Release Nos. 7221 (June 9, 1972) and 11330 (September 4, 1980).

Item 26. Business and Other Connections of the Investment Adviser

None

Item 27. Principal Underwriters

(a) American Funds Distributors, Inc. is also the Principal Underwriter of shares of: AMCAP Fund, Inc., American Balanced Fund, Inc., The American Funds Income Series, The American Funds Tax-Exempt Series I, The American Funds Tax-Exempt Series II, American High-Income Municipal Bond Fund, Inc., American High-Income Trust, American Mutual Fund, Inc., The Bond Fund of America, Inc., Capital Income Builder, Inc., Capital World Bond Fund, Inc., Capital World Growth and Income Fund, Inc., The Cash Management Trust of America, EuroPacific Growth Fund, Fundamental Investors, Inc., The Growth Fund of America, Inc., The Income Fund of America, Inc., The Investment Company of America, Intermediate Bond Fund of America, Limited Term Tax-Exempt Bond Fund of America, The New Economy Fund, New Perspective Fund, Inc., SMALLCAP World Fund, Inc., The Tax-Exempt Bond Fund of America, Inc., The Tax-Exempt Money Fund of America, U.S. Treasury Money Fund of America and Washington Mutual Investors Fund, Inc.

New World Fund, Inc. - Pg C-

(b)

	(1) Name and Principal Business Address	(2) Positions and Offices with Underwriter	(3) Positions and Offices with Registrant

	David L. Abzug	Vice President	None
	P.O. Box 2248
	Agoura Hills, CA 91376

	William C. Anderson	Regional Vice President	None
	7780 Boylston Court
	Dublin, OH 43016

	Robert B. Aprison	Senior Vice President	None
	2983 Bryn Wood Drive
	Madison, WI 53711

	Shakeel A. Barkat	Regional Vice President	None
	982 Wayson Way
	Davidsonville, MD 21035

	Steven L. Barnes	Senior Vice President	None
	7490 Clubhouse Road
	Suite 100
	Boulder, CO 80301

	Thomas M. Bartow	Vice President	None
	20 Cerchio Alto
	Henderson, NV 89011

B	Carl R. Bauer	Vice President	None

	Michelle A. Bergeron	Senior Vice President	None
	4160 Gateswalk Drive
	Smyrna, GA 30080

	J. Walter Best, Jr.	Vice President	None
	7003 Chadwick Drive, Suite 355
	Brentwood, TN 37027

	John A. Blanchard	Senior Vice President	None
	576 Somerset Lane
	Northfield, IL 60093

	Ian B. Bodell	Senior Vice President	None
	7003 Chadwick Drive, Suite 355
	Brentwood, TN 37027

	Bill Brady	Regional Vice President	None
	646 Somerset Drive
	Indianapolis, IN 46260

	Mick L. Brethower	Senior Vice President	None
	601 E. Whitestone Blvd.
	Building 6, Suite 115
	Cedar Park, TX 78613

	C. Alan Brown	Vice President	None
	7424 Somerset Avenue
	St. Louis, MO 63105

L	Sheryl M. Burford	Assistant Vice President	None

B	J. Peter Burns	Vice President	None

	Steven Calabria	Regional Vice President	None
	161 Bay Avenue
	Huntington Bay, NY 11743

S	Kathleen D. Campbell	Assistant Vice President	None

	Matthew C. Carlisle	Regional Vice President	None
	100 Oakmont Lane, #409
	Belleair, FL 33756

	Damian F. Carroll	Vice President	None
	40 Ten Acre Road
	New Britain, CT 06052

	James D. Carter	Regional Vice President	None
	401 Bridle Court
	Chesapeake, VA 23323

	Brian C. Casey	Senior Vice President	None
	8002 Greentree Road
	Bethesda, MD 20817

	Victor C. Cassato	Senior Vice President	None
	999 Green Oaks Drive
	Greenwood Village, CO 80121

	Christopher J. Cassin	Senior Vice President	None
	120 E. Ogden Ave., Suite 106
	Hinsdale, IL 60521

L	Denise M. Cassin	Director, Senior Vice President	None

L	David D. Charlton	Senior Vice President	None

	Thomas M. Charon	Regional Vice President	None
	N27 W23960 Paul Road
	Suite 204
	Pewaukee, WI 53072

L	Wellington Choi	Assistant Vice President	None

	Paul A. Cieslik	Regional Vice President	None
	90 Northington Drive
	Avon, CT 06001

L	Larry P. Clemmensen	Director	None

L	Kevin G. Clifford	Director, President and Co-Chief Executive Officer	None

H	Cheri Coleman	Vice President	None

	Ruth M. Collier	Senior Vice President	None
	106 Central Park South, #10K
	New York, NY 10019

S	David Coolbaugh	Vice President	None

	Carlo O. Cordasco	Regional Vice President	None
	4036 Ambassador Circle
	Williamsburg, VA 23188

B	Josie Cortez	Assistant Vice President	None

	Thomas E. Cournoyer	Vice President	None
	2333 Granada Blvd.
	Coral Gables, FL 33134

L	Michael D. Cravotta	Assistant Vice President	None

	Joseph G. Cronin	Vice President	None
	1281 Fiore Drive
	Lake Forest, IL 60045

	William F. Daugherty	Vice President	None
	1213 Redwood Hills Circle
	Carlisle, PA 17013

	Guy E. Decker	Vice President	None
	2990 Topaz Lane
	Carmel, IN 46032

	Daniel J. Delianedis	Senior Vice President	None
	Edina Executive Plaza
	5200 Willson Road, Suite 150
	Edina, MN 55424

L	James W. DeLouise	Assistant Vice President	None

	James A. DePerno, Jr.	Vice President	None
	1 Nehercrest Lane
	Orchard Park, NY 14127

L	Bruce L. DePriester	Director, Senior Vice President, Treasurer and Controller	None

	Lori A. Deuberry	Regional Vice President	None
	130 Aurora Street
	Hudson, OH 44236

L	Dianne M. Dexter	Assistant Vice President	None

	Thomas J. Dickson	Vice President	None
	108 Wilmington Court
	Southlake, TX 76092

	Michael A. DiLella	Senior Vice President	None
	22 Turner’s Lake Drive
	Mahwah, NJ 07430

	G. Michael Dill	Director, Senior Vice President	None
	505 E. Main Street
	Jenks, OK 74037

N	Dean M. Dolan	Vice President	None

L	Hedy B. Donahue	Assistant Vice President	None

L	Michael J. Downer	Director, Secretary	Vice President

	Michael J. Dullaghan	Regional Vice President	None
	5040 Plantation Grove Lane
	Roanoke, VA 24012

I	Lloyd G. Edwards	Senior Vice President	None

	Timothy L. Ellis	Senior Vice President	None
	1441 Canton Mart Road, Suite 9
	Jackson, MS 39211

	William F. Flannery	Regional Vice President	None
	29 Overlook Road
	Hopkinton, MA 01748

	John R. Fodor	Senior Vice President	None
	15 Latisquama Road
	Southborough, MA 01772

L	Charles L. Freadhoff	Vice President	None

	Daniel B. Frick	Vice President	None
	845 Western Avenue
	Glen Ellyn, IL 60137

L	Linda S. Gardner	Vice President	None

	Keith R. George	Regional Vice President	None
	3835 East Turtle Hatch Road
	Springfield, MO 65809

L	J. Christopher Gies	Senior Vice President	None

B	Lori A. Giacomini	Assistant Vice President	None

B	Evelyn K. Glassford	Vice President	None

	Jack E. Goldin	Regional Vice President	None
	3424 Belmont Terrace
	Davie, FL 33328

L	Earl C. Gottschalk	Vice President	None

	Jeffrey J. Greiner	Senior Vice President	None
	8250-A Estates Parkway
	Plain City, OH 43064

	Eric M. Grey	Regional Vice President	None
	601 Fisher Road
	N. Dartmouth, MA 02747

B	Mariellen Hamann	Vice President	None

	Derek S. Hansen	Vice President	None
	13033 Ridgedale Drive, #147
	Minnetonka, MN 55305

	David E. Harper	Senior Vice President	None
	5400 Russell Cave Road
	Lexington, KY 40511

	Calvin L. Harrelson, III	Regional Vice President	None
	2048 Kings Manor Drive
	Weddington, NC 28104

	Robert J. Hartig, Jr.	Vice President	None
	13563 Marjac Way
	McCordsville, IN 46055

L	Linda M. Hines	Vice President	None

	Steven J. Hipsley	Regional Vice President	None
	44 Tyler Drive
	Saratoga Springs, NY 12866

L	Russell K. Holliday	Vice President	None

L	Kevin B. Hughes	Vice President	None

	Ronald R. Hulsey	Senior Vice President	None
	6202 Llano
	Dallas, TX 75214

	Marc Ialeggio	Regional Vice President	None
	13 Prince Royal Passage
	Corte Madera, CA 94925

	Robert S. Irish	Senior Vice President	None
	1225 Vista Del Mar Drive
	Delray Beach, FL 33483

B	Damien M. Jordan	Senior Vice President	None

L	Marc J. Kaplan	Assistant Vice President	None

	John P. Keating	Vice President	None
	1576 Sandy Springs Dr.
	Orange Park, FL 32003

	Brian G. Kelly	Regional Vice President	None
	76 Daybreak Road
	Southport, CT 06890

	Andrew J. Kilbride	Regional Vice President	None
	3080 Tuscany Court
	Ann Arbor, MI 48103

N	Dorothy Klock	Vice President	None

	Dianne L. Koske	Assistant Vice President	None
	122 Clydesdale Court
	Hampton, VA 23666

B	Elizabeth K. Koster	Vice President	None

	Christopher F. Lanzafame	Regional Vice President	None
	19365 Lovall Valley Court
	Sonoma, CA 95476

	Patricia D. Lathrop	Regional Vice President	None
	822 Monterey Blvd., NE
	St. Petersburg, FL 33704

	R. Andrew LeBlanc	Vice President	None
	78 Eton Road
	Garden City, NY 11530

	T. Blake Liberty	Vice President	None
	5506 East Mineral Lane
	Littleton, CO 80122

	Mark J. Lien	Vice President	None
	1103 Tulip Tree Lane
	West Des Moines, IA 50266

L	Lorin E. Liesy	Vice President	None

I	Kelle Lindenberg	Assistant Vice President	None

	Louis K. Linquata	Vice President	None
	5214 Cass Street
	Omaha, NE 68132

	Brendan T. Mahoney	Vice President	None
	1 Union Avenue, 2 ^nd Floor
	Sudbury, MA 01776

	Stephen A. Malbasa	Director, Senior Vice President	None
	13405 Lake Shore Blvd.
	Cleveland, OH 44110

	Steven M. Markel	Senior Vice President	None
	5241 South Race Street
	Greenwood Village, CO 80121

L	Paul R. Mayeda	Assistant Vice President	None

L	Eleanor P. Maynard	Vice President	None

L	Christopher McCarthy	Vice President	None

	James R. McCrary	Vice President	None
	28812 Crestridge
	Rancho Palos Verdes, CA 90275

S	John V. McLaughlin	Senior Vice President	None

	Terry W. McNabb	Senior Vice President	None
	2002 Barrett Station Road
	St. Louis, MO 63131

L	Katharine McRoskey	Assistant Vice President	None

	Scott M. Meade	Vice President	None
	370 Central Road
	Rye Beach, NH 03870

	Charles L. Mitsakos	Regional Vice President	None
	3017 11 ^th Avenue West
	Seattle, WA 98119

	Monty L. Moncrief	Regional Vice President	None
	55 Chandler Creek Court
	The Woodlands, TX 77381

	David H. Morrison	Regional Vice President	None
	7021 North Stratton Court
	Peoria, IL 61615

	Andrew J. Moscardini	Regional Vice President	None
	832 Coldwater Creek Circle
	Niceville, FL 32578

	William E. Noe	Senior Vice President	None
	3600 Knollwood Road
	Nashville, TN 37215

L	Heidi J. Novaes	Vice President	None

	Peter A. Nyhus	Senior Vice President	None
	15345 Wilderness Ridge Rd, NW
	Prior Lake, MN 55372

G1	Luis Freitas de Oliveira	Director	None

	Eric P. Olson	Senior Vice President	None
	27 Main Street
	Topsfield, MA 01983

	Jeffrey A. Olson	Regional Vice President	None
	2708 88 ^th St. Court, NW
	Gig Harbor, WA 98332

	Thomas A. O’Neil	Regional Vice President	None
	400 N. Woodlawn, Suite 202
	Woodlawn Central Office Building
	Wichita, KS 67208

	W. Burke Patterson, Jr.	Regional Vice President	None
	1643 Richland Avenue
	Baton Rouge, LA 70808

	Gary A. Peace	Vice President	None
	291 Kaanapali Drive
	Napa, CA 94558

	Samuel W. Perry	Regional Vice President	None
	4340 East Indian School Road
	Suite 21
	Phoenix, AZ 85018

	Raleigh G. Peters	Regional Vice President	None
	1439 Byrd Drive
	Berwyn, PA 19312

	David K. Petzke	Vice President	None
	4016 Saint Lucia Street
	Boulder, CO 80301

	Fredric Phillips	Senior Vice President	None
	175 Highland Avenue, 4th Floor
	Needham, MA 02494

	John Pinto	Regional Vice President	None
	226 Country Club Drive
	Lansdale, PA 19446

	Carl S. Platou	Senior Vice President	None
	7455 80th Place, S.E.
	Mercer Island, WA 98040

S	Richard P. Prior	Vice President	None

	Mike Quinn	Regional Vice President	None
	1035 Vintage Club Drive
	Duluth, GA 30097

S	John W. Rankin	Regional Vice President	None
	8602 Drayton Heights
	San Antonio, TX 78254

	Jennifer D. Rasner	Regional Vice President	None
	11940 Baypoint Drive
	Burnsville, MN 55337

	James P. Rayburn	Regional Vice President	None
	3108 Roxbury Road
	Homewood, AL 35209

	Mark S. Reischmann	Regional Vice President	None
	4125 Hermitage Drive
	Colorado Springs, CO 80906

	Steven J. Reitman	Senior Vice President	None
	212 The Lane
	Hinsdale, IL 60521

	Brian A. Roberts	Vice President	None
	209-A 60 ^th Street
	Virginia Beach, VA 23451

L	James F. Rothenberg	Director	None

	Romolo D. Rottura	Vice President	None
	233 Glenhaven Court
	Swedesboro, NJ 08085

	Douglas F. Rowe	Vice President	None
	414 Logan Ranch Road
	Georgetown, TX 78628

	Christopher S. Rowey	Vice President	None
	10538 Cheviot Drive
	Los Angeles, CA 90064

	William M. Ryan	Regional Vice President	None
	1408 Cortland Drive
	Manasquan, NJ 08736

L	Dean B. Rydquist	Director, Senior Vice President, Chief Compliance Officer	None

	Richard A. Sabec, Jr.	Regional Vice President	None
	6868 Meadow Glen Drive
	Westerville, OH 43082

	Richard R. Samson	Senior Vice President	None
	4604 Glencoe Avenue, #4
	Marina del Rey, CA 90292

	Paul V. Santoro	Vice President	None
	28 State Street, Suite 1100
	Boston, MA 02109

	Mark A. Seaman	Vice President	None
	308 Emilies Lane
	Severna Park, MD 21146

	Joseph D. Scarpitti	Senior Vice President	None
	31465 St. Andrews
	Westlake, OH 44145

	Shane D. Schofield	Regional Vice President	None
	201 McIver Street
	Greenville, SC 29601

S	Sherrie L. Senft	Vice President	None

	James J. Sewell III	Regional Vice President	None
	415 East Holyoke Place
	Claremont, CA 91711

	Arthur M. Sgroi	Regional Vice President	None
	76 Fields End Drive
	Glenmont, NY 12077

L	R. Michael Shanahan	Director	None

L	Michael J. Sheldon	Vice President	None

	Frederic J. Shipp	Regional Vice President	None
	1352 Sanjo Farms Drive
	Chesapeake, VA 23320

	Daniel S. Shore	Regional Vice President	None
	3734 North Greenview Avenue
	Chicago, IL 60613

	Brad Short	Vice President	None
	1601 Seal Way
	Seal Beach, CA 90740

	David W. Short	Chairman of the Board and	None
	1000 RIDC Plaza, Suite 212	Co-Chief Executive Officer
	Pittsburgh, PA 15238

	Nathan W. Simmons	Regional Vice President	None
	496 Dogwood Trail
	Quincy, FL 32352

	William P. Simon, Jr.	Senior Vice President	None
	912 Castlehill Lane
	Devon, PA 19333

L	Connie F. Sjursen	Vice President	None

	Jerry L. Slater	Senior Vice President	None
	4227 E. Madison, #2D
	Seattle, WA 98112

LW	John H. Smet	Director	None

	Rodney G. Smith	Senior Vice President	None
	15851 Dallas Parkway, Suite 500
	Addison, TX 75001-6016

	J. Eric Snively	Regional Vice President	None
	2548 Violet Street
	Glenview, IL 60025

	Anthony L. Soave	Vice President	None
	3780 Foxglove Court NE
	Grand Rapids, MI 49525

L	Therese L. Soullier	Vice President	None

	Nicholas D. Spadaccini	Senior Vice President	None
	855 Markley Woods Way
	Cincinnati, OH 45230

L	Kristen J. Spazafumo	Vice President	None

	Mark D. Steburg	Regional Vice President	None
	12508 160 ^th Avenue Southeast
	Renton, WA 98059

	Michael P. Stern	Regional Vice President	None
	213 Aptos Place
	Danville, CA 94526

	Brad Stillwagon	Vice President	None
	2438 Broadmeade Road
	Louisville, KY 40205

	Thomas A. Stout	Vice President	None
	1004 Ditchley Road
	Virginia Beach, VA 23451

	Craig R. Strauser	Senior Vice President	None
	13160 Princeton Court
	Lake Oswego, OR 97035

L	Libby J. Syth	Vice President	None

L	Drew W. Taylor	Assistant Vice President	None

L	Larry I. Thatt	Assistant Vice President	None

	Gary J. Thoma	Regional Vice President	None
	401 Desnoyer
	Kaukauna, WI 54130

	Cynthia M. Thompson	Regional Vice President	None
	4 Franklin Way
	Ladera Ranch, CA 92694

L	James P. Toomey	Vice President	None

I	Christopher E. Trede	Vice President	None

	George F. Truesdail	Senior Vice President	None
	400 Abbotsford Court
	Charlotte, NC 28270

	Scott W. Ursin-Smith	Senior Vice President	None
	103 E. Blithedale Avenue
	Mill Valley, CA 94941

S	Cindy Vaquiax	Assistant Vice President	None

	J. David Viale	Vice President	None
	39 Old Course Drive
	Newport Beach, CA 92660

D	Bradley J. Vogt	Director	None

	Gerald J. Voss	Regional Vice President	None
	1009 Ridge Road
	Sioux Falls, SD 57105

L	A. Jordan Wallens	Regional Vice President	None
	1501 Maple Avenue, #602
	Evanston, IL 60201

	Thomas E. Warren	Vice President	None
	119 Faubel St.
	Sarasota, FL 34242

L	J. Kelly Webb	Senior Vice President	None

	Gregory J. Weimer	Director,	None
	206 Hardwood Drive	Senior Vice President
	Venetia, PA 15367

B	Timothy W. Weiss	Director	None

	Dana L. Wells	Regional Vice President	None
	4444 Riverside Drive, Suite 110
	Burbank, CA 91505-4048

SF	Gregory W. Wendt	Director	None

	George J. Wenzel	Vice President	None
	261 Barden Road
	Bloomfield Hills, MI 48304

	Brian E. Whalen	Regional Vice President	None
	4072 Yellow Ginger Glen
	Norcross, GA 30092

L	N. Dexter Williams, Jr.	Senior Vice President	None

L	Alan J. Wilson	Director	None

	Andrew L. Wilson	Vice President	None
	11163 Rich Meadow Drive
	Great Falls, VA 22066

	Steven C. Wilson	Regional Vice President	None
	83 Kaydeross Park Road
	Saratoga Springs, NY 12866

	Timothy J. Wilson	Vice President	None
	501 Valley Brook Road, Suite 204
	McMurray, PA 15317

B	Laura L. Wimberly	Vice President	None

	Marshall D. Wingo	Director, Senior Vice President	None
	Promenade Two, 25 ^th Floor
	1230 Peachtree Street, N.E.
	Atlanta, GA 30309

	Kurt A. Wuestenberg	Vice President	None
	975 Arboretum Drive
	Saline, MI 48176

	William R. Yost	Senior Vice President	None
	9463 Olympia Drive
	Eden Prairie, MN 55347

	Jason P. Young	Regional Vice President	None
	11141 Whitetail Lane
	Olathe, KS 66061

	Jonathan A. Young	Regional Vice President	None
	2145 Hickory Forrest
	Chesapeake, VA 23322

	Scott D. Zambon	Regional Vice President	None
	2178 Pieper Lane
	Tustin, CA 92782

__________

L	Business Address, 333 South Hope Street, Los Angeles, CA 90071
LW	Business Address, 11100 Santa Monica Blvd., 15th Floor, Los Angeles, CA 90025
B	Business Address, 135 South State College Boulevard, Brea, CA 92821
S	Business Address, 3500 Wiseman Boulevard, San Antonio, TX 78251
SF	Business Address, One Market, Steuart Tower, Suite 1800, San Francisco, CA 94105-1016
H	Business Address, 5300 Robin Hood Road, Norfolk, VA 23513
I	Business Address, 8332 Woodfield Crossing Blvd., Indianapolis, IN 46240
N	Business Address, 630 Fifth Avenue, 36 ^th Floor, New York, NY10111
D	Business Address, 3000 K Street N.W., Suite 230, Washington, DC 20007-5140
G1	Business Address, 3 Place des Bergues, 1201 Geneva, Switzerland

Item 28. Location of Accounts and Records.

Accounts, books and other records required by Rules 31a-1 and 31a-2 under the Investment Company Act of 1940, as amended, are maintained and held in the offices of the Registrant’s investment adviser, Capital Research and Management Company, 333 South Hope Street, Los Angeles, California 90071; 135 South State College Boulevard, Brea, California 92821; and/or 5300 Robin Hood Road, Norfolk, Virginia 23513.

Registrant's records covering shareholder accounts are maintained and kept by its transfer agent, American Funds Service Company, 135 South State College Boulevard, Brea, California 92821; 8332 Woodfield Crossing Boulevard, Indianapolis, Indiana 46240; 10001 North 92 ^nd Street, Suite 100, Scottsdale, Arizona 85258; 3500 Wiseman Boulevard, San Antonio, Texas 78251; and 5300 Robin Hood Road, Norfolk, VA 23513.

Registrant's records covering portfolio transactions are maintained and kept by its custodian, JPMorgan Chase Bank, 270 Park Avenue, New York, New York 10017-2070.

Item 29. Management Services

None

Item 30. Undertakings

None

New World Fund, Inc. - Pg C-

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant certifies that it meets all of the requirements for effectiveness of this registration statement under Rule 485(b) under the Securities Act of 1933 and has duly caused this registration statement to be signed on its behalf by the undersigned, duly authorized, in the City of Los Angeles, and State of California, on the 28th day of December, 2005.

NEW WORLD FUND, INC.

By /s/ Gina H. Despres

(Gina H. Despres, Vice Chairman of the Board)

Pursuant to the requirements of the Securities Act of 1933, this amendment to Registration Statement has been signed below on December 28, 2005, by the following persons in the capacities indicated.

	Signature	Title
(1)	Principal Executive Officer:
	/s/ Robert W. Lovelace	President and Director
	(Robert W. Lovelace)
(2)	Principal Financial Officer Principal Accounting Officer:and
	/s/ R. Marcia Gould	Treasurer
	(R. Marcia Gould)
(3)	Directors:
	Elisabeth Allison*	Director
	Vanessa C.L. Chang*	Director
	/s/ Gina H. Despres	Vice Chairman of the Board
	(Gina H. Despres)
	Robert A. Fox*	Director
	Jae H. Hyun*	Director
	Koichi Itoh*	Director
	William H. Kling*	Director
	/s/ Robert W. Lovelace	President and Director
	(Robert W. Lovelace)
	John G. McDonald*	Director
	William I. Miller*	Chairman of the Board (Independent and Non-Executive)
	Alessandro Ovi*	Director
	Kirk P. Pendleton*	Director
	Rozanne L. Ridgway*	Director
	*By /s/ Vincent P. Corti
	(Vincent P. Corti, pursuant to a power of attorney filed herewith)

Counsel represents that this amendment does not contain disclosures that would make the amendment ineligible for effectiveness under the provisions of rule 485(b).

/s/ Herbert Y. Poon

(Herbert Y. Poon)

New World Fund, Inc. - Pg C-

POWER OF ATTORNEY

I, Elisabeth Allison, the undersigned Board member of the following registered investment companies (collectively, the “Funds”):

-	EuroPacific Growth Fund
-	New Perspective Fund, Inc.
-	New World Fund, Inc.

hereby revoke all previous powers of attorney I have signed and otherwise act in my name and behalf in matters involving the Funds and do hereby constitute and appoint

Vincent P. Corti

Chad L. Norton

Patrick F. Quan

Julie F. Williams

Rodney S. Kiemele

Steven I. Koszalka

R. Marcia Gould

each of them singularly, my true and lawful attorneys-in-fact, with full power of substitution, and with full power to each of them, to sign for me and in my name in the appropriate capacities, all Registration Statements of the Funds on Form N-1A, Form N-8A or any successor thereto, any and all subsequent Amendments, or Post-Effective Amendments to said Registration Statements on Form N-1A or any successor thereto, and Registration Statements on Form N-14, and any supplements or other instruments in connection therewith, and generally to do all such things in my name and behalf in connection therewith as said attorneys-in-fact deem necessary or appropriate, to comply with the provisions of the Securities Act of 1933 and the Investment Company Act of 1940 as amended, and all related requirements of the U. S. Securities and Exchange Commission. I hereby ratify and confirm all that said attorneys-in-fact or their substitutes may do or cause to be done by virtue hereof.

EXECUTED at Belmont, MA , this 5th day of July, 2005.

(City, State)

/s/ Elisabeth Allison

Elisabeth Allison, Board member

POWER OF ATTORNEY

I, Vanessa C. L. Chang, the undersigned Board member of the following registered investment companies (collectively, the “Funds”):

-	EuroPacific Growth Fund
-	New Perspective Fund, Inc.
-	New World Fund, Inc.

hereby revoke all previous powers of attorney I have signed and otherwise act in my name and behalf in matters involving the Funds and do hereby constitute and appoint

Vincent P. Corti

Chad L. Norton

Patrick F. Quan

Julie F. Williams

Rodney S. Kiemele

Steven I. Koszalka

R. Marcia Gould

EXECUTED at Los Angeles, CA , this 26th day of July, 2005.

(City, State)

/s/ Vanessa C. L. Chang

Vanessa C. L. Chang, Board member

POWER OF ATTORNEY

I, Robert A. Fox, the undersigned Board member of the following registered investment companies (collectively, the “Funds”):

-	American Balanced Fund, Inc.
-	EuroPacific Growth Fund
-	Fundamental Investors, Inc.
-	The Growth Fund of America, Inc.
-	The Income Fund of America, Inc.
-	New Perspective Fund, Inc.
-	New World Fund, Inc.

hereby revoke all previous powers of attorney I have signed and otherwise act in my name and behalf in matters involving the Funds and do hereby constitute and appoint

Vincent P. Corti

Chad L. Norton

Patrick F. Quan

Julie F. Williams

Rodney S. Kiemele

Steven I. Koszalka

R. Marcia Gould

Sheryl F. Johnson

EXECUTED at Reno, NV , this 20th day of July, 2005.

(City, State)

/s/ Robert A. Fox

Robert A. Fox, Board member

POWER OF ATTORNEY

I, Jae H. Hyun, the undersigned Board member of the following registered investment companies (collectively, the “Funds”):

-	EuroPacific Growth Fund
-	New Perspective Fund, Inc.
-	New World Fund, Inc.

hereby revoke all previous powers of attorney I have signed and otherwise act in my name and behalf in matters involving the Funds and do hereby constitute and appoint

Vincent P. Corti

Chad L. Norton

Patrick F. Quan

Julie F. Williams

Rodney S. Kiemele

Steven I. Koszalka

R. Marcia Gould

EXECUTED at Seoul, Korea , this 5th day of July, 2005.

(City, State)

/s/ Jae H. Hyun

Jae H. Hyun, Board member

POWER OF ATTORNEY

I, Koichi Itoh, the undersigned Board member of the following registered investment companies (collectively, the “Funds”):

-	Capital Income Builder, Inc.
-	Capital World Growth and Income Fund, Inc.
-	EuroPacific Growth Fund
-	New Perspective Fund, Inc.
-	New World Fund, Inc.

hereby revoke all previous powers of attorney I have signed and otherwise act in my name and behalf in matters involving the Funds and do hereby constitute and appoint

Vincent P. Corti

Chad L. Norton

Patrick F. Quan

Julie F. Williams

Rodney S. Kiemele

Steven I. Koszalka

R. Marcia Gould

Sheryl F. Johnson

Jeffrey P. Regal

EXECUTED at Tokyo, Japan , this 6th day of November, 2005.

(City, State)

/s/ Koichi Itoh

Koichi Itoh, Board member

POWER OF ATTORNEY

I, William H. Kling, the undersigned Board member of the following registered investment companies (collectively, the “Funds”):

-	EuroPacific Growth Fund
-	The New Economy Fund
-	New Perspective Fund, Inc.
-	New World Fund, Inc.
-	SMALLCAP World Fund, Inc.

hereby revoke all previous powers of attorney I have signed and otherwise act in my name and behalf in matters involving the Funds and do hereby constitute and appoint

Vincent P. Corti

Chad L. Norton

Patrick F. Quan

Julie F. Williams

Rodney S. Kiemele

Steven I. Koszalka

R. Marcia Gould

David A. Pritchett

EXECUTED at St. Paul, MN , this 20th day of July, 2005.

(City, State)

/s/ William H. Kling

William H. Kling, Board membe

POWER OF ATTORNEY

I, John G. McDonald, the undersigned Board member of the following registered investment companies (collectively, the “Funds”):

-	American Balanced Fund, Inc.
-	EuroPacific Growth Fund
-	Fundamental Investors, Inc.
-	The Growth Fund of America, Inc.
-	The Income Fund of America, Inc.
-	The Investment Company of America
-	New Perspective Fund, Inc.
-	New World Fund, Inc.

hereby revoke all previous powers of attorney I have signed and otherwise act in my name and behalf in matters involving the Funds and do hereby constitute and appoint

Vincent P. Corti

Chad L. Norton

Patrick F. Quan

Julie F. Williams

Rodney S. Kiemele

Steven I. Koszalka

R. Marcia Gould

Sheryl F. Johnson

EXECUTED at Stanford, CA , this 5th day of July, 2005.

(City, State)

/s/ John G. McDonald

John G. McDonald, Board member

POWER OF ATTORNEY

I, William I. Miller, the undersigned Board member of the following registered investment companies (collectively, the “Funds”):

-	EuroPacific Growth Fund
-	New Perspective Fund, Inc.
-	New World Fund, Inc.

hereby revoke all previous powers of attorney I have signed and otherwise act in my name and behalf in matters involving the Funds and do hereby constitute and appoint

Vincent P. Corti

Chad L. Norton

Patrick F. Quan

Julie F. Williams

Rodney S. Kiemele

Steven I. Koszalka

R. Marcia Gould

EXECUTED at Columbus, IN , this 11th day of July, 2005.

(City, State)

/s/ William I. Miller

William I. Miller, Board member

POWER OF ATTORNEY

I, Alessandro Ovi, the undersigned Board member of the following registered investment companies (collectively, the “Funds”):

-	EuroPacific Growth Fund
-	New Perspective Fund, Inc.
-	New World Fund, Inc.

hereby revoke all previous powers of attorney I have signed and otherwise act in my name and behalf in matters involving the Funds and do hereby constitute and appoint

Vincent P. Corti

Chad L. Norton

Patrick F. Quan

Julie F. Williams

Rodney S. Kiemele

Steven I. Koszalka

R. Marcia Gould

EXECUTED at Rome, Italy , this 7th day of July, 2005.

(City, State)

/s/ Alessandro Ovi

Alessandro Ovi, Board member

POWER OF ATTORNEY

I, Kirk P. Pendleton, the undersigned Board member of the following registered investment companies (collectively, the “Funds”):

-	AMCAP Fund, Inc.
-	American Funds Insurance Series
-	American Mutual Fund, Inc.
-	EuroPacific Growth Fund
-	New Perspective Fund, Inc.
-	New World Fund, Inc.

hereby revoke all previous powers of attorney I have signed and otherwise act in my name and behalf in matters involving the Funds and do hereby constitute and appoint

Vincent P. Corti

Chad L. Norton

Patrick F. Quan

Julie F. Williams

Rodney S. Kiemele

Steven I. Koszalka

R. Marcia Gould

Sheryl F. Johnson

David A. Pritchett

EXECUTED at Bryn Athyn, PA , this 27th day of July, 2005.

(City, State)

/s/ Kirk P. Pendleton

Kirk P. Pendleton, Board member

POWER OF ATTORNEY

I, Rozanne L. Ridgway, the undersigned Board member of the following registered investment companies (collectively, the “Funds”):

-	EuroPacific Growth Fund
-	New Perspective Fund, Inc.
-	New World Fund, Inc.

hereby revoke all previous powers of attorney I have signed and otherwise act in my name and behalf in matters involving the Funds and do hereby constitute and appoint

Vincent P. Corti

Chad L. Norton

Patrick F. Quan

Julie F. Williams

Rodney S. Kiemele

Steven I. Koszalka

R. Marcia Gould

EXECUTED at Arlington, VA , this 5th day of July, 2005.

(City, State)

/s/ Rozanne L. Ridgway

Rozanne L. Ridgway, Board member

BY-LAWS *

NEW WORLD FUND, INC.

(as amended June 2, 2005)

ARTICLE I

SHAREHOLDERS

Section 1.01 . Annual Meetings . The Corporation is not required to hold an annual meeting in any year in which the election of directors is not required to be acted upon under the Investment Company Act of 1940, as amended (the "1940 Act"). If the election of directors is required to be acted upon under the 1940 Act then such meeting (or the first such meeting in any year) shall be designated as the annual meeting of stockholders for that year. If the 1940 Act requires the Corporation to hold a meeting of stockholders to elect directors, the meeting shall, unless otherwise required by the 1940 Act, be held no later than 120 days after the occurrence of the event requiring the meeting. Except as the Charter or statute provides otherwise, any business may be considered at an annual meeting without the purpose of the meeting having been specified in the notice. Failure to hold an annual meeting does not invalidate the Corporation's existence or affect any otherwise valid corporate acts.

Section 1.02 . Special Meetings . At any time in the interval between annual meetings, special meetings of the shareholders may be called by the Chairman of the Board or the President or by a majority of the Board or by shareholders entitled to cast 10% in number of votes by vote at a meeting or in writing with or without a meeting.

Section 1.03 . Place of Meetings . Meetings of the shareholders for the election of Directors shall be held at such place either within or without the State of Maryland or elsewhere in the United States as shall be designated from time to time by the Board of Directors and stated in the notice of the meeting. Meetings of shareholders for any other purpose may be held at such time and place, within the State of Maryland or elsewhere in the United States, as shall be stated in the notice of the meeting or in a duly executed waiver of notice thereof.

Section 1.04 . Notice of Meetings . Not less than ten days nor more than ninety days before the date of every shareholders' meeting, the Secretary shall give to each shareholder entitled to vote at such meeting, written or printed notice stating the time and place of the meeting and, if the meeting is a special meeting or notice of the purpose is required by statute, the purpose or purposes for which the meeting is called, either by mail or by presenting it to the shareholder personally or by leaving it at the shareholder's residence or usual place of business. If mailed, such notice shall be deemed to be given when deposited in the United States mail addressed to the shareholder at his post office address as it appears on the records of the Corporation, with postage thereon prepaid. Notwithstanding the foregoing provision, a waiver of notice in writing, signed by the person or persons entitled to such notice and filed with the records of the meeting, whether before or after the holding thereof, or actual attendance at the meeting in person or by proxy, shall be deemed equivalent to the giving of such notice to such persons. Any meeting of shareholders, annual or special, may adjourn from time to time to reconvene at the same or some other place, and no notice need be given of any such adjourned meeting other than by announcement at the meeting.

* Gender Designation - Whenever in these By-Laws a gender designation is used, the gender designation is used for convenience only. All references in these By-Laws are intended to be, and will for all purposes be interpreted to be, gender neutral.

Section 1.05 . Quorum . At any meeting of shareholders the presence in person or by proxy of shareholders entitled to cast one third of the votes thereat shall constitute a quorum; but this Section shall not affect any requirement under statute or under the Articles for the vote necessary for the adoption of any measure. In the absence of a quorum the shareholders present in person or by proxy, by majority vote and without notice, may adjourn the meeting from time to time until a quorum shall attend. At any such adjourned meeting at which a quorum shall be present, any business may be transacted which might have been transacted at the meeting as originally called.

Section 1.06 . Votes Required . A majority of the votes cast at a meeting of shareholders, duly called and at which a quorum is present, shall be sufficient to take or authorize action upon any matter which may properly come before the meeting, unless more than a majority of votes cast is required by statute or by the Articles. Each outstanding share of stock shall be entitled to one vote on each matter submitted to a vote at a meeting of shareholders and fractional shares shall be entitled to corresponding fractions of one vote on such matters, except that a plurality of all the votes cast at a meeting at which a quorum is present is sufficient to elect a director.

Section 1.07 . Proxies . A shareholder may vote the shares owned of record by him either in person or by proxy executed in writing by the shareholder or by the shareholder's duly authorized attorney-in-fact. No proxy shall be valid after eleven months from its date, unless otherwise provided in the proxy. Every proxy shall be in writing, subscribed by the shareholder or the shareholder's duly authorized attorney, and dated, but need not be sealed, witnessed or acknowledged.

Section 1.08 . List of Shareholders . At each meeting of shareholders, a full, true and complete list in alphabetical order of all shareholders entitled to vote at such meeting, certifying the number and class or series of shares held by each, shall be made available by the Secretary.

Section 1.09 . Voting . In all elections for Directors every shareholder shall have the right to vote, in person or by proxy, the shares owned of record by the shareholder, for as many persons as there are Directors to be elected and for whose election the shareholder has a right to vote. At all meetings of shareholders, unless the voting is conducted by inspectors, the proxies and ballots shall be received, and all questions regarding the qualification of voters and the validity of proxies and the acceptance or rejection of votes shall be decided by the chairman of the meeting. If demanded by shareholders, present in person or by proxy, entitled to cast 10% in number of votes, or if ordered by the chairman, the vote upon any election or question shall be taken by ballot. Upon like demand or order, the voting shall be conducted by two inspectors in which event the proxies and ballots shall be received, and all questions regarding the qualification of voters and the validity of proxies and the acceptance or rejection of votes shall be decided, by such inspectors. Unless so demanded or ordered, no vote need be by ballot, and voting need not be conducted by inspectors. Inspectors may be elected by the shareholders at their annual meeting, to serve until the close of the next annual meeting and their election may be held at the same time as the election of Directors. In case of a failure to elect inspectors, or in case an inspector shall fail to attend, or refuse or be unable to serve, the shareholders at any meeting may choose an inspector or inspectors to act at such meeting, and in default of such election the chairman of the meeting may appoint an inspector or inspectors.

Section 1.10 . Action by Shareholders Other than at a Meeting . Any action required or permitted to be taken at any meeting of shareholders may be taken without a meeting, if a consent in writing, setting forth such action, is signed by all the shareholders entitled to vote on the subject matter thereof and any other shareholders entitled to notice of a meeting of shareholders (but not to vote thereat) have waived in writing any rights which they may have to dissent from such action, and such consent and waiver are filed with the records of the Corporation.

ARTICLE II

BOARD OF DIRECTORS

Section 2.01. Chairman of the Board. The Chairman of the Board, if one be elected by the Board of Directors, shall preside at all meetings of the Board of Directors and of the shareholders at which he is present. He shall have and may exercise such powers as are, from time to time, assigned to him by the Board of Directors or as may be required by law. If the Chairman of the Board is a director who is not an “interested person” of the Corporation as defined in Section 2(a)(19) of the 1940 Act (“independent director”), the Chairman of the Board shall serve as a non-executive Chairman and shall not be considered an officer of the Corporation. The election of an independent director as Chairman of the Board will not reduce the responsibilities of the other Directors. The Chairman of the Board shall hold such title until a successor shall have been duly chosen and qualified, or until the Chairman shall have resigned or shall have been removed. Any vacancy may be filled for the unexpired portion of the term by the Board of Directors at any regular or special meeting.

Section 2.02 . Powers . The Board may exercise all the powers of the Corporation, except such as are by statute or the charter or these By-Laws conferred upon or reserved to the shareholders. The Board shall keep full and fair accounts of its transactions.

Section 2.03 . Number of Directors . The number of Directors shall be such number as shall be fixed from time to time by vote of a majority of the Directors; provided, however, that the number of Directors shall in no event exceed fifteen nor be reduced to fewer than three. The tenure of office of a Director shall not be affected by any decrease in the number of Directors made by the Board.

Section 2.04 . Election of Directors . Until the first annual meeting of shareholders and until successors or additional Directors are duly elected and qualify, the Board shall consist of the persons named as such in the charter. At the first annual meeting of shareholders and at each annual meeting thereafter, the shareholders shall elect Directors to hold office until the next succeeding annual meeting and until their successors are elected and qualify. At any meeting of shareholders, duly called and at which a quorum is present, the shareholders may, by the affirmative vote of the holders of a majority of the votes entitled to be cast thereon, remove any Director or Directors from office and may elect a successor or successors to fill any resulting vacancies for the unexpired terms of removed Directors.

Section 2.05 . Regular Meetings . After each meeting of shareholders at which a Board of Directors shall have been elected, the Board so elected shall meet for the purpose of organization and the transaction of other business. No notice of such first meeting shall be necessary if held immediately after the adjournment, and at the site, of such meeting of shareholders. Other regular meetings of the Board shall be held without notice on such dates and at such places within or without the State of Maryland as may be designated from time to time by the Board.

Section 2.06 . Special Meetings . Special meetings of the Board may be called at any time by the Chairman of the Board, the President or the Secretary of the Corporation, or by a majority of the Board by vote at a meeting, or in writing with or without a meeting. Such special meetings shall be held at such place or places within or without the State of Maryland as may be designated from time to time by the Board. In the absence of such designation such meetings shall be held at such places as may be designated in the calls.

Section 2.07 . Notice of Meetings . Except as provided in Section 2.04, notice of the place, day and hour of all meetings shall be given to each Director two days (or more) before the meeting, by delivering the same personally, or by sending the same by telegraph, or by leaving the same at the Director's residence or usual place of business, or, in the alternative, by mailing such notice three days (or more) before the meeting, postage prepaid, and addressed to the Director at the Director's last known business or residence post office address, according to the records of the Corporation. Unless required by these By-Laws or by resolution of the Board, no notice of any meeting of the Board need state the business to be transacted thereat. No notice of any meeting of the Board need be given to any Director who attends, or to any Director who in writing executed and filed with the records of the meeting either before or after the holding thereof, waives such notice. Any meeting of the Board, regular or special, may adjourn from time to time to reconvene at the same or some other place, and no notice need be given of any such adjourned meeting other than by announcement at the adjourned meeting.

Section 2.08 . Quorum . At all meetings of the Board, a majority of the entire Board (but in no event fewer than two Directors) shall constitute a quorum for the transaction of business. Except in cases in which it is by statute, by the charter or by these By-Laws otherwise provided, the vote of a majority of such quorum at a duly constituted meeting shall be sufficient to elect and pass any measure. In the absence of a quorum, the Directors present by majority vote and without notice other than by announcement at the meeting may adjourn the meeting from time to time until a quorum shall attend. At any such adjourned meeting at which a quorum shall be present, any business may be transacted which might have been transacted at the meeting as originally noticed.

Section 2.09 . Vacancies . Any vacancy occurring in the Board of Directors for any cause other than by reason of an increase in the number of Directors may be filled by a majority of the remaining members of the Board of Directors, although such majority is less than a quorum. Any vacancy occurring by reason of an increase in the number of Directors may be filled by action of a majority of the entire Board of Directors; provided, in either case, that immediately after filling such vacancy at least two-thirds of the Directors then holding office shall have been elected to such office by the shareholders at an annual or special meeting thereof. If at any time after the first annual meeting of shareholders of the Corporation a majority of the Directors in office shall consist of Directors elected by the Board of Directors, a meeting of the shareholders shall be called forthwith for the purpose of electing the entire Board of Directors, and the terms of office of the Directors then in office shall terminate upon the election and qualification of such Board of Directors. A Director elected by the Board of Directors or the shareholders to fill a vacancy shall be elected to hold office until the next annual meeting of shareholders and until his successor is elected and qualifies.

Section 2.10 . Compensation and Expenses . Directors may, pursuant to resolution of the Board, be paid fees for their services, which fees may consist of an annual fee or retainer and/or a fixed fee for attendance at meetings. In addition, Directors may in the same manner be reimbursed for expenses incurred in connection with their attendance at meetings or otherwise in performing their duties as Directors. Members of committees may be allowed like compensation and reimbursement. Nothing herein contained shall preclude any Director from serving the Corporation in any other capacity and receiving compensation therefor.

Section 2.11 . Action by Directors Other than at a Meeting . Any action required or permitted to be taken at any meeting of the Board, or of any committee thereof, may be taken without a meeting, if a written consent to such action is signed by all members of the Board or of such committee, as the case may be, and such written consent is filed with the minutes of proceedings of the Board or committee.

Section 2.12 . Committees . The Board may, by resolution passed by a majority of the entire Board, designate one or more committees, each committee to consist of two or more of the Directors. The Board may designate one or more Directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. Any such committee, to the extent provided in the resolution and by law, shall have and may exercise the powers of the Board in the management of the business and affairs of the Corporation, provided, however, that in the absence or disqualification of any member of such committee or committees, the member or members thereof present at any meeting and not disqualified from voting, whether or not he or they constitute a quorum, may appoint another member of the Board to act at the meeting in the place of any such absent or disqualified member. Such committee or committees shall have such name or names as may be determined from time to time by resolution adopted by the Board. Each committee shall keep regular minutes of its meetings and report the same to the Board when required.

Section 2.13 . Holding of Meetings by Conference Telephone Call . At any regular or special meeting of the Board or any committee thereof, members thereof may participate in such meeting by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other. Participation in a meeting pursuant to this section shall constitute presence in person at such meeting.

Section 2.14 . Hiring of Employees or Retaining of Advisers and Experts . The Board of Directors who are not considered “interested persons” of the Corporation under the 1940 Act may hire employees or retain advisers and experts as they deem necessary to help ensure that they are able to deal with matters beyond their expertise and fulfill their role of representing shareholder interests.

ARTICLE III

OFFICERS

Section 3.01 . Executive Officers . The Board of Directors may choose one or more Vice Chairmen of the Board from among the Directors, and shall choose a President, a Secretary and a Treasurer who need not be Directors. The Board of Directors shall designate as principal executive officer of the Corporation either a Vice Chairman of the Board or the President. The Board of Directors may choose an Executive Vice President, one or more Senior Vice Presidents, one or more Vice Presidents, one or more Assistant Secretaries and one or more Assistant Treasurers, none of whom need be a Director. Any two or more of the above-mentioned offices, except those of President and a Vice President, may be held by the same person, but no officer shall execute, acknowledge or verify any instrument in more than one capacity if such instrument be required by law, by the charter, by the By-Laws or by resolution of the Board of Directors to be executed by any two or more officers. Each such officer shall hold office until his successor shall have been duly chosen and qualified, or until he shall have resigned or shall have been removed. Any vacancy in any of the above offices may be filled for the unexpired portion of the term of the Board of Directors at any regular or special meeting.

Section 3.02 . Vice Chairman of the Board . A Vice Chairman of the Board, if one be elected, shall, when present and in the absence of the Chairman of the Board, preside at all meetings of the shareholders and Directors, and he shall perform such other duties as may from time to time be assigned to him by the Board of Directors or as may be required by law.

Section 3.03 . President . In the absence of the Chairman or Vice Chairman of the Board, the President shall preside at all meetings of the shareholders and of the Board at which the President is present; and in general, shall perform all duties incident to the office of a president of a Maryland Corporation, and such other duties, as from time to time, may be assigned to him by the Board.

Section 3.04 . Vice Presidents . The Vice President or Vice Presidents, including any Executive or Senior Vice President(s), at the request of the President or in the President's absence or during the President's inability or refusal to act, shall perform the duties and exercise the functions of the President, and when so acting shall have the powers of the President. If there be more than one Vice President, the Board may determine which one or more of the Vice Presidents shall perform any of such duties or exercise any of such functions, or if such determination is not made by the Board, the President may make such determination. The Vice President or Vice Presidents shall have such other powers and perform such other duties as may be assigned by the Board, the Chairman of the Board, or the President.

Section 3.05 . Secretary and Assistant Secretaries . The Secretary shall keep the minutes of the meetings of the shareholders, of the Board and of any committees, in books provided for the purpose; shall see that all notices are duly given in accordance with the provisions of these By-Laws or as required by law; be custodian of the records of the Corporation; see that the corporate seal is affixed to all documents the execution of which, on behalf of the Corporation, under its seal, is duly authorized, and when so affixed may attest the same; and in general perform all duties incident to the office of a secretary of a Maryland Corporation, and such other duties as, from time to time, may be assigned to him by the Board, the Chairman of the Board, or the President.

The Assistant Secretary, or if there be more than one, the Assistant Secretaries in the order determined by the Board, the President or the Chairman of the Board, shall, in the absence of the Secretary or in the event of the Secretary's inability or refusal to act, perform the duties and exercise the powers of the Secretary and shall perform such other duties and have such other powers as the Board may from time to time prescribe.

Section 3.06 . Treasurer and Assistant Treasurers . The Treasurer shall have charge of and be responsible for all funds, securities, receipts and disbursements of the Corporation, and shall deposit, or cause to be deposited in the name of the Corporation, all moneys or other valuable effects in such banks, trust companies or other depositories as shall, from time to time, be selected by the Board in accordance with Section 6.04 of these By-Laws; render to the President, the Chairman of the Board and to the Board, whenever requested, an account of the financial condition of the Corporation; and in general, perform all the duties incident to the office of a treasurer of a corporation, such other duties as may be assigned to him by the Board, the President or the Chairman of the Board.

The Assistant Treasurer, or if there shall be more than one, the Assistant Treasurers in the order determined by the Board, the President or the Chairman of the Board shall, in the absence of the Treasurer or in the event of the Treasurer's inability or refusal to act, perform the duties and exercise the powers of the Treasurer and shall perform other duties and have such other powers as the Board may from time to time prescribe.

Section 3.07 . Subordinate Officers . The Board may from time to time appoint such subordinate officers as it may deem desirable. Each such officer shall hold office for such period and perform such duties as the Board, the President or the Chairman of the Board may prescribe. The Board may, from time to time, authorize any committee or officer to appoint and remove subordinate officers and prescribe the duties thereof.

Section 3.08 . Removal . Any officer or agent of the Corporation may be removed by the Board whenever, in its judgment, the best interests of the Corporation will be served thereby, but such removal shall be without prejudice to the contractual rights, if any, of the person so removed.

ARTICLE IV

STOCK

Section 4.01 . Certificates . Each shareholder shall be entitled to a certificate or certificates which shall represent and certify the number of shares of stock owned by him in the Corporation. Such certificate shall be signed by the President, the Chairman of the Board or a Vice President and countersigned by the Secretary or an Assistant Secretary or the Treasurer or an Assistant Treasurer. The signatures may be either manual or facsimile signatures. No certificates shall be issued for fractional shares. Such certificates shall be in such form, not inconsistent with law or with the charter, as shall be approved by the Board. In case any officer of the Corporation who has signed any certificate ceases to be an officer of the Corporation, whether because of death, resignation or otherwise, before such certificate is issued, the certificate may nevertheless be issued and delivered by the Corporation as if the officer had not ceased to be such officer as of the date of its issue. Certificates need not be issued except to shareholders who request such issuance in writing. A certificate is valid and may be issued whether or not an officer who signed it is still an officer when it is issued.

Section 4.02. Transfers . The Board of Directors shall have power and authority to make such rules and regulations as it may deem necessary or expedient concerning the issue, transfer and registration of certificates of stock; and may appoint transfer agents and registrars thereof. The duties of transfer agent and registrar, if any, may be combined.

Section 4.03 . Stock Ledgers . A stock ledger, containing the names and addresses of the shareholders of the Corporation and the number of shares of each class held by them, respectively, shall be kept by the Transfer Agent of the Corporation. The stock ledger may be in written form or in any other form which can be converted within a reasonable time into written form for visual inspection.

Section 4.04 . Record Dates . The Board is hereby empowered to fix, in advance, a date as the record date for the purpose of determining shareholders entitled to notice of, or to vote at, any meeting of shareholders, or shareholders entitled to receive payment of any dividend, capital gains distribution or the allotment of any rights, or in order to make a determination of shareholders for any other proper purpose. Such date in any case shall be not more than ninety days, and in case of a meeting of shareholders, not less than ten days, prior to the date on which the particular action, requiring such determination of shareholders, is to be taken.

Section 4.05 . Replacement Certificates . The Board of Directors may direct a new stock certificate or certificates to be issued in place of any certificate or certificates theretofore issued by the Corporation alleged to have been lost, stolen or destroyed, upon such conditions as the Board shall determine. When authorizing such issue of a new certificate or certificates, the Board of Directors may, in it discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificate or certificates, or his legal representative to advertise the same in such manner as it shall require and/or to give the Corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the Corporation with respect to the Certificate alleged to have been lost, stolen or destroyed.

ARTICLE V

INDEMNIFICATION AND INSURANCE

Section 5.01 . Indemnification . The Corporation shall promptly indemnify and hold harmless each of its directors and officers, and may indemnify and hold harmless any of its employees and agents, against any liabilities or expenses (collectively, “Liability”) actually and reasonably incurred by such person in any proceeding arising out of or in connection with his or her service to the Corporation, to the fullest extent permitted by the Articles of Incorporation and the laws of the State of Maryland, the Securities Act of 1933, and the Investment Company Act of 1940, as now or hereafter in effect, subject to the provisions of paragraphs (a) and (b) of this Section 5.01. The Board of Directors may take such action as is necessary to carry out these indemnification provisions and is expressly empowered to adopt, approve and amend from time to time these By-laws, resolutions or contracts implementing such provisions or such further indemnification arrangements as may be permitted by law. No amendment of these By-laws shall limit or eliminate the right to indemnification provided hereunder with respect to acts or omissions occurring prior to such amendment or repeal.

(a) Special Condition . With respect to Liability to the Corporation or its stockholders, and subject to applicable state and federal law, a director or officer shall be indemnified and held harmless pursuant to this Section 5.01 against any Liability to the Corporation or its stockholders unless such Liability arises by reason of his or her willful misfeasance, bad faith, gross negligence, or reckless disregard of the duties involved in the conduct of his or her office as defined in Section 17(h) of the Investment Company Act of 1940 (“disabling conduct”).

(b) Special Process Condition . With respect to Liability to the Corporation or its stockholders, no indemnification shall be made unless a determination has been made by reasonable and fair means that the director or officer has not engaged in disabling conduct. In making such a determination, the Board of Directors shall act in conformity with then applicable law and administrative interpretations, and shall afford a director requesting indemnification who is not an “interested person” of the Corporation, as defined in Section 2(a)(19) of the Investment Company Act of 1940, as amended, a rebuttable presumption that such director did not engage in disabling conduct while acting in his or her capacity as a director.

Section 5.02 . Advancement of Expenses . The Corporation shall promptly advance funds to its directors and officers, and may advance funds to its employees and agents, to cover expenses they incur with respect to any proceeding arising out of or in connection with their service to the Corporation, to the fullest extent permitted by the Articles of Incorporation and the laws of the State of Maryland, the Securities Act of 1933, and the Investment Company Act of 1940, as now or hereafter in effect.

(a) Affirmation of Conduct. A request by a director or officer for advancement of funds pursuant to this Section 5.02 shall be accompanied by the director’s or officer’s written affirmation of his or her good faith belief that he or she met the standard of conduct necessary for indemnification, and such other statements, documents or undertakings as may be required under applicable law.

(b) Special Conditions to Advancement . With respect to Liability to the Corporation or its stockholders, and subject to applicable state and federal law, a director or officer shall be entitled to advancements of expenses pursuant to this Section 5.02 against any Liability to the Corporation or its stockholders if (1) the Corporation has obtained assurances required under applicable law, such as by obtaining insurance or receiving collateral provided by the director or officer, that the advance will be repaid if the director or officer is found to have engaged in disabling conduct, or (2) the Board has a reasonable belief that the director or officer has not engaged in disabling conduct and ultimately will be entitled to indemnification. In forming such a reasonable belief, the Board of Directors shall act in conformity with then applicable law and administrative interpretations, and shall afford a director requesting an advance who is not an “interested person” of the Corporation, as defined in Section 2(a)(19) of the Investment Company Act of 1940, as amended, a rebuttable presumption that such director did not engage in disabling conduct while acting in his or her capacity as a director.

Section 5.03. Insurance . The Corporation shall purchase and maintain in effect one or more policies of insurance on behalf of its directors and officers in such amounts and with such coverage as shall be determined from time to time by the Board of Directors, and may purchase and maintain such insurance for any of its employees and agents, issued by a reputable insurer or insurers, against any expenses actually and reasonably incurred by such person in any proceeding arising out of or in connection with his or her service to the Corporation, with customary limitations and exceptions, whether or not the Corporation would have the power to indemnify such person against such expenses pursuant to this Article V.

Section 5.04. General Provisions .

(a) Non-Exclusive Rights . The provisions for indemnification of, and advancement of expenses to, directors and officers of the Corporation set forth in this Article V shall not be deemed exclusive of any other contractual or legal rights to which a director or officer may otherwise be entitled.

(b) Continuation of Provisions . The provisions of this Article V shall continue as to a person who has ceased to provide service to the Corporation and shall inure to the benefit of his or her spouses, heirs, assigns, devisees, executors, administrators and legal representatives. No amendment of the Articles of Incorporation or By-Laws of the Corporation shall limit or eliminate the right of a person to indemnification, advancement of expenses and insurance set forth in this Article V with respect to his or her acts, omissions or service to the Corporation occurring prior to such amendment.

Section 5.05. Definitions . For purposes of this Article V, the following terms shall have the following meanings:

(1) “Disabling conduct” shall be as defined in Section 5.01(a).

(2) “Expenses” shall include without limitation all judgments, penalties, fines, amounts paid or to be paid in settlement, ERISA excise taxes, liabilities, losses, interest, expenses of investigation, attorneys’ fees, retainers, court costs, transcript costs, fees of experts and witnesses, expenses of preparing for and attending depositions and other proceedings, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other costs, disbursements or expenses of the type customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, or acting as a witness in a proceeding.

(3) “Liability” shall be as defined in Section 5.01.

(4) The term “proceeding” shall include without limitation any threatened, pending or completed claim, demand, threat, discovery request, request for testimony or information, action, suit, arbitration, alternative dispute mechanism, investigation, hearing, or other proceeding, including any appeal from any of the foregoing, whether civil, criminal, administrative or investigative.

(5) A person’s “service to the Corporation” shall include without limitation his or her service as a director, officer, employee, agent or representative of the Corporation, and his or her service at the request of the Corporation as a director, officer, employee, agent or representative of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise.

ARTICLE VI

GENERAL PROVISIONS

Section 6.01 . Dividends . Dividends or distributions upon the capital stock of the Corporation, subject to provisions of the charter, if any, may be declared by the Board of Directors at any regular or special meeting, pursuant to law. Dividends or distributions may be paid only in cash or in shares of the capital stock, subject to the provisions of the Articles of Incorporation.

Before payment of any dividend or distribution there may be set aside out of any funds of the Corporation available for dividends or distributions such sum or sums as the directors from time to time, in their absolute discretion, think proper as a reserve or reserves to meet contingencies, or for equalizing dividends or distributions or for maintaining any property of the Corporation, or for such other purpose as the Directors shall think conducive to the interest of the Corporation, and the Directors may modify or abolish any such reserve in the manner in which it was created.

Section 6.02 . Checks . All checks or demands for money and notes of the Corporation shall be signed by such officer or officers or such other person or persons as the Board may from time to time designate.

Section 6.03 . Fiscal Year . The fiscal year of the Corporation shall be fixed by resolution of the Board of Directors.

Section 6.04 . Custodian . All securities and cash of the Corporation shall be placed in the custody of a bank or trust company ("Custodian") having (according to its last published report) not less than $2,000,000 aggregate capital, surplus and undivided profits, provided such a Custodian can be found ready and willing to act (or maintained in such other manner as is consistent with Section 17(f) of the Investment Company Act of 1940 and the rules and regulations promulgated thereunder.) The Corporation shall enter into a written contract with the Custodian regarding the powers, duties and compensation of the Custodian with respect to the cash and securities of the Corporation held by the Board of Directors of the Corporation. The Corporation shall upon the resignation or inability to serve of the Custodian use its best efforts to obtain a successor custodian; require that the cash and securities owned by the Corporation be delivered directly to the successor custodian; and in the event that no successor custodian can be found, submit to the shareholders, before permitting delivery of the cash and securities owned by the Corporation to other than a successor custodian, the question whether or not the Corporation shall be liquidated or shall function without a custodian.

Section 6.05 . Seal . The Board of Directors shall provide a suitable seal, bearing the name of the Corporation, which shall be in the custody of the Secretary. The Board of Directors may authorize one or more duplicate seals and provide for the custody thereof.

Section 6.06 . Representation of Shares . Any officer of the Corporation is authorized to vote, represent and exercise of the Corporation any and all rights incident to any shares of any corporation or other business enterprise owned by the Corporation.

Section 6.07 . Prohibited Transactions . No officer or director of the Corporation or of its investment adviser shall deal for or on behalf of the Corporation with himself, as principal or agent, or with any corporation or partnership in which he has a financial interest. This prohibition shall not prevent: (a) officers or directors of the Corporation from having a financial interest in the Corporation, its principal underwriter or its investment adviser; (b) the purchase of securities for the portfolio of the Corporation or the sale of securities owned by the Corporation through a securities dealer, one or more of whose partners, officers or directors is an officer or director of the Corporation, provided such transactions are handled in the capacity of broker only and provided commissions charged do not exceed customary brokerage charges for such service; or (c) the employment of legal counsel, registrar, transfer agent, dividend disbursing agent, or custodian having a partner, officer or director who is an officer or director of the Corporation, provided only customary fees are charged for services rendered to or for the benefit of the Corporation.

Section 6.08 . Bonds. The Board of Directors may require any officer, agent or employee of the Corporation to give a bond to the Corporation, conditioned upon the faithful discharge of his duties, with one or more sureties and in such amount as may be satisfactory to the Board of Directors. The Board of Directors shall, in any event, require the Corporation to provide and maintain a bond issued by a reputable fidelity insurance company, against larceny and embezzlement, covering each officer and employee of the Corporation who may singly, or jointly with others, have access to securities or funds of the Corporation, either directly or through authority to draw upon such funds, or to direct generally the disposition of such securities, such bond or bonds to be in such reasonable amount as a majority of the Board of Directors who are not such officers or employees of the Corporation shall determine with due consideration to the value of the aggregate assets of the Corporation to which any such officer or employee may have access, or in any amount or upon such terms as the Securities and Exchange Commission may prescribe by order, Rule or Regulations.

Section 6.09 . Annual Statement of Affairs . The President or the Controller shall prepare annually a full and correct statement of the affairs of the Corporation, to include a balance sheet and a financial statement of operations for the preceding fiscal year. The statement of affairs shall be placed on file at the Corporation's principal office within 120 days after the end of the fiscal year.

ARTICLE VII

AMENDMENT OF BY-LAWS

These By-Laws of the Corporation may be altered, amended, added to or repealed by majority vote of the shareholders or by majority vote of the entire Board.

AMENDED INVESTMENT ADVISORY AND SERVICE AGREEMENT

THIS AGREEMENT, dated and effective as of the 10th day of March, 2005, is made and entered into by and between NEW WORLD FUND, INC. , a Maryland corporation, (hereinafter called the “Fund”), and CAPITAL RESEARCH AND MANAGEMENT COMPANY , a Delaware corporation, (hereinafter called the “Investment Adviser”).

A. The Fund is an open-end diversified investment company of the management type, registered under the Investment Company Act of 1940 (the “1940 Act”). The Investment Adviser is registered under the Investment Advisers Act of 1940 and is engaged in the business of providing investment advisory and related services to the Fund and to other investment companies.

B. The Investment Adviser has provided investment advisory services to the Fund since its inception, and is currently providing such services under a written agreement dated December 2, 1999, as renewed.

NOW, THEREFORE, in consideration of the premises and the mutual undertaking of the parties, it is covenanted and agreed as follows:

1. The Investment Adviser shall determine what securities and other assets shall be purchased or sold by the Fund.

2. The Investment Adviser shall furnish the services of persons to perform the executive, administrative, clerical, and bookkeeping functions of the Fund, including the daily determination of net asset value per share. The Investment Adviser shall pay the compensation and travel expenses of all such persons, and they shall serve without any additional compensation from the Fund. The Investment Adviser shall also, at its expense, provide the Fund with necessary office space (which may be in the offices of the Investment Adviser); all necessary office equipment and utilities; and general purpose forms, supplies, and postage used at the offices of the Fund.

3. The Fund shall pay all its expenses not assumed by the Investment Adviser as provided herein. Such expenses shall include, but shall not be limited to, expenses incurred in connection with the organization of the Fund, its qualification to do business as a foreign corporation in the State of California, and its registration as an investment company under the 1940 Act; custodian, stock transfer and dividend disbursing fees and expenses; distribution expenses pursuant to a plan under rule 12b-1 under the 1940 Act; costs of designing and of printing and mailing to its shareholders reports, prospectuses, proxy statements, and notices to its shareholders; taxes; expenses of the issuance, sale, redemption, or repurchase of shares of the Fund (including registration and qualification expenses); legal and auditing fees and expenses; compensation, fees, and expenses paid to directors not affiliated with the Investment Adviser; association dues; and costs of any share certificates, stationery and forms prepared exclusively for the Fund.

4. The Fund shall pay to the Investment Adviser on or before the tenth (10th) day of each month, as compensation for the services rendered by the Investment Adviser during the preceding month a fee, which shall be accrued daily, calculated at the annual rate of:

0.85% on first $500 million of average net assets;

0.77% on such assets in excess of $500 million to $1 billion;

0.71% on such assets in excess of $1 billion to $1.5 billion;

0.66% on such assets in excess of $1.5 billion to $2.5 billion;

0.62% on such assets in excess of $2.5 billion to $4 billion;

0.58% on such assets in excess of $4 billion to $6.5 billion;

0.54% on such assets in excess of $6.5 billion.

For the purposes hereof, the net assets of the Fund shall be determined in the manner set forth in the Articles of Incorporation and Prospectus of the Fund. The advisory fee shall be payable for the period commencing on the date on which operations of the Fund begin and ending on the date of termination hereof and shall be prorated for any fraction of a month at the termination of such period.

5. The Investment Adviser agrees that in the event the expenses of the Fund (with the exclusion of interest, taxes, brokerage costs, extraordinary expenses such as litigation and acquisitions or other expenses excludable under applicable state securities laws or regulations) for any fiscal year ending on a date on which this Investment Advisory and Service Agreement is in effect, exceed the expense limitations, if any, applicable to the Fund pursuant to state securities laws or any regulations thereunder, it will reduce its fee by the extent of such excess and, if required pursuant to any such laws or regulations, will reimburse the Fund in the amount of such excess.

6. The expense limitation described in Section 5 shall apply only to Class A shares issued by the Fund and shall not apply to any other class(es) of shares the Fund may issue in the future. Any new class(es) of shares issued by the Fund will not be subject to an expense limitation. However, notwithstanding the foregoing, to the extent the Investment Adviser is required to reduce its management fee pursuant to provisions contained in Section 5 due to the expenses of the Class A shares exceeding the stated limit, the Investment Adviser will either (i) reduce its management fee similarly for other classes of shares, or (ii) reimburse the Fund for other expenses to the extent necessary to result in an expense reduction only for Class A shares of the Fund.

7. This Agreement may be terminated at any time, without payment of any penalty, by the Directors of the Fund or by vote of a majority (within the meaning of the 1940 Act) of the outstanding voting securities of the Fund, on sixty (60) days' written notice to the Investment Adviser, or by the Investment Adviser on like notice to the Fund. Unless sooner terminated in accordance with this provision, this Agreement shall continue until December 31, 2005. It may thereafter be renewed from year to year by mutual consent; provided that such renewal shall be specifically approved at least annually by the Board of Directors of the Fund, or by vote of a majority (within the meaning of the 1940 Act) of the outstanding voting securities of the Fund. In either event, it must be approved by a majority of those Directors who are not parties to such Agreement nor interested persons of any such party, cast in person at a meeting called for the purpose of voting on such approval.

8. This Agreement shall not be assignable by either party hereto, and in the event of assignment (within the meaning of the 1940 Act) by the Investment Adviser shall automatically be terminated forthwith.

9. Nothing contained in this Agreement shall be construed to prohibit the Investment Adviser from performing investment advisory, management, or distribution services for other investment companies and other persons or companies, nor to prohibit affiliates of the Investment Adviser from engaging in such businesses or in other related or unrelated businesses.

10. The Investment Adviser shall not be liable to the Fund or its stockholders for any error of judgment, act, or omission not involving willful misfeasance, bad faith, gross negligence, or reckless disregard of its obligations and duties hereunder.

11. It is understood that the name, “American Funds” and “Capital” or any derivatives thereof or logo associated with those names are the valuable property of the Investment Adviser and its affiliates, and that the Fund shall have the right to use such names (or derivatives or logos) only so long as this Agreement shall continue in effect. Upon termination of this Agreement the Fund shall forthwith cease to use such names (or derivatives or logos).

IN WITNESS WHEREOF, the parties hereto have caused this instrument to be executed in duplicate original by their duly authorized officers.

	CAPITAL RESEARCH AND
NEW WORLD FUND, INC.	MANAGEMENT COMPANY

By /s/ Gina H. Despres	By /s/ Paul G. Haaga, Jr.
Gina H. Despres,	Paul G. Haaga, Jr.,
Chairman of the Board	Executive Vice President

By /s/ Vincent P. Corti	By /s/ Michael J. Downer
Vincent P. Corti,	Michael J. Downer,
Secretary	Vice President and Secretary

SUPPLEMENTAL AGREEMENT

This Agreement (“Supplemental Agreement”) is effective as of October 1, 2004, and is between JPMorgan Chase Bank, N.A. (formerly known as The Chase Manhattan Bank) ("Bank") and each of the investment companies and other pooled investment vehicles (which may be organized as corporations, business or other trusts, limited liability companies, partnerships or other entities) managed by Capital Research and Management Company and listed on Appendix A hereto, as such Appendix may be amended from time to time (each a "Customer").

WHEREAS, each Customer is or may be organized with one or more series of shares, each of which shall represent an interest in a separate investment portfolio of cash, securities and other assets;

WHEREAS, each Customer has appointed, in accordance with the provisions of the Investment Company Act of 1940, as amended (the "1940 Act"), and the rules and regulations thereunder, Bank as custodian on behalf of itself or those of its existing or additional series of shares that are also listed on Appendix A hereto (each such listed investment portfolio being referred to hereinafter as a “Portfolio”), and Bank has agreed to act as custodian for the Portfolios under the terms and conditions of a Global Custody Agreement dated June 29, 2001 (“Custody Agreement);

WHEREAS, subsequent to the effective date of the Custody Agreement, the U.S. Securities and Exchange Commission (“Commission”) amended Rule 17f-4 under the 1940 Act (as so amended, “Rule 17f-4”), and the parties hereto wish to conform their activities governed by the Custody Agreement to the requirements of Rule 17f-4;

WHEREAS, for administrative purposes only, each Customer wishes to evidence its individual agreement with Bank in a single instrument, notwithstanding each Customer’s intention to be separately bound;

NOW THEREFORE, Bank and each Customer agree as follows:

1. Definitions.

As used herein, the following terms shall have the following respective meanings:

(a) Clearing corporation, financial asset, securities intermediary, and security entitlement have the same meanings as is attributed to those terms in § 8-102, § 8-103, and §§ 8-501 through 8-511 of the Uniform Commercial Code, 2002 Official Text and Comments, which are incorporated by reference in Rule 17f-4.[NY]

(b) Custodian means a bank or other person authorized to hold assets for the fund under Section 17(f) of the 1940 Act, but does not include Customer, a foreign custodian or eligible securities depository whose use is governed by Rules 17f-5 or 17f-7, or a vault, safe deposit box, or other repository for safekeeping maintained by a bank or other company whose functions and physical facilities are supervised by a federal or state authority if the fund maintains its own assets there in accordance with Rule 17f-2.

(c) Intermediary custodian means any subcustodian that is a securities intermediary and is qualified to act as a custodian.

(d) Securities depository means a clearing corporation that is registered with the Commission as a clearing agency under section 17A of the Securities Exchange Act of 1934; or a Federal Reserve Bank or other person authorized to operate the federal book entry system described in the regulations of the Department of Treasury codified at 31 CFR 357, Subpart B, or book-entry systems operated pursuant to comparable regulations of other federal agencies.

2.	Maintenance of Financial Assets and Cash at Securities Depository or Intermediate Custodian

If Bank places and maintains a Customer’s financial assets, corresponding to Customer’s security entitlements, with a securities depository or intermediary custodian, Bank must:

(a) at a minimum exercise due care in accordance with reasonable commercial standards in discharging its duty as a securities intermediary to obtain and thereafter maintain such financial assets;

(b) provide, promptly upon request by Customer, such reports as are available concerning the internal accounting controls and financial strength of Bank; and

(c) require any intermediary custodian at a minimum to exercise due care in accordance with reasonable commercial standards in discharging its duty as a securities intermediary to obtain and thereafter maintain financial assets corresponding to the security entitlements of its entitlement holders.

3. Miscellaneous.

(a) Governing Law; Successors and Assigns; Immunity; Captions. THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN NEW YORK and shall not be assigned by either party, but shall bind the successors in interest of Customer and Bank. To the extent that in any jurisdiction Customer or Bank may now or hereafter be entitled to claim, for itself or its assets, immunity from suit, execution, attachment (before or after judgment) or other legal process, Customer or Bank, as the case may be, irrevocably shall not claim, and it hereby waives, such immunity. The captions given to the sections and subsections of this Agreement are for convenience of reference only and are not to be used to interpret this Agreement.

(b) Entire Agreement. This Agreement consists exclusively of this document (including Appendix A). There are no other provisions hereof and this Agreement supersedes any other agreements, whether written or oral, between the parties and relating to the matters discussed herein; provided, however, that where the provisions of the Custody Agreement are not inconsistent with the provisions of this Agreement,the provisions of the Custody Agreement shall control; and provided further, that (i) the limitations on Bank’s liability with respect to the acts or omissions of securities depositories contained in Section 14(d) of the Custody Agreement shall control; and (ii) the standard of care applicable to Bank as set forth in Section 3(a) of this Agreement, rather than the standard of care applicable to Bank under the Custody Agreement, shall control. Any amendment hereto must be in writing, executed by both parties.

(c) Severability. In the event that one or more provisions hereof are held invalid, illegal or unenforceable in any respect on the basis of any particular circumstances or in any jurisdiction, the validity, legality and enforceability of such provision or provisions under other circumstances or in other jurisdictions and of the remaining provisions shall not in any way be affected or impaired.

(d) Waiver. Except as otherwise provided herein, no failure or delay on the part of either party in exercising any power or right hereunder operates as a waiver, nor does any single or partial exercise of any power or right preclude any other or further exercise, or the exercise of any other power or right. No waiver by a party of any provision hereof, or waiver of any breach or default, is effective unless in writing and signed by the party against whom the waiver is to be enforced.

(e) Notices. All notices hereunder shall be effective when actually received. Any notices or other communications which may be required hereunder are to be sent to the parties at the following addresses or such other addresses as may subsequently be given to the other party in writing: (a) Bank: JPMorgan Chase Bank, N.A., 4 Chase MetroTech Center, Brooklyn, N.Y. 11245, Attention: Craig Prentiss, Vice President, Global Investor Services, Investment Management Group; and (b) Customer: [Name of Customer], c/o Capital Research and Management Company, Attention: Thomas M. Rowland, Senior Vice President, 135 South State College Boulevard, Brea, CA 92821-5804; with a copy to: Stuart R. Strachan, Vice President and Senior Counsel, Capital Research and Management Company, 333 S. Hope Street, 55 ^th Floor, Los Angeles, CA 90071.

(f) Termination. This Agreement may be terminated as to one or more Portfolios by Customer or Bank by giving sixty (60) days’ written notice to the other, provided that such notice to Bank shall specify the names of the persons to whom Bank shall deliver the Assets belonging to the affected Portfolios in the Accounts. If notice of termination is given by Bank, Customer shall, within sixty (60) days following receipt of the notice, deliver to Bank Instructions specifying the names of the persons to whom Bank shall deliver the Assets belonging to the affected Portfolios. In either case Bank shall deliver the Assets belonging to the affected Portfolios to the persons so specified, after deducting any amounts which Bank determines in good faith to be owed to it under Section 15. If within sixty (60) days following receipt of a notice of termination by Bank, Bank does not receive Instructions from Customer specifying the names of the persons to whom Bank shall deliver the Assets belonging to the affected Portfolios, Bank, at its election, may deliver such Assets to a bank or trust company doing business in the State of New York to be held and disposed of pursuant to the provisions hereof, or to Authorized Persons, or may continue to hold such Assets until Instructions are provided to Bank. For avoidance of doubt, each Customer, Portfolio or the Bank may terminate this Agreement pursuant to its provisions and the Agreement shall survive such termination in respect of the remaining Customers and Portfolios that have not so terminated or been terminated.

(g) Representative Capacity; Non-recourse Obligations . A COPY OF THE DECLARATION OF TRUST OR OTHER ORGANIZATIONAL DOCUMENT OF EACH CUSTOMER IS ON FILE WITH THE SECRETARY OF STATE OF THE STATE OF THE CUSTOMER’S FORMATION, AND NOTICE IS HEREBY GIVEN THAT THIS AGREEMENT IS NOT EXECUTED ON BEHALF OF THE TRUSTEES OF ANY CUSTOMER AS INDIVIDUALS, AND THE OBLIGATIONS OF THIS AGREEMENT ARE NOT BINDING UPON ANY OF THE TRUSTEES, OFFICERS, SHAREHOLDERS OR PARTNERS OF ANY FUND INDIVIDUALLY, BUT ARE BINDING ONLY UPON THE ASSETS AND PROPERTY OF EACH CUSTOMER’S RESPECTIVE PORTFOLIOS. BANK AGREES THAT NO SHAREHOLDER, TRUSTEE, OFFICER OR PARTNER OF ANY FUND MAY BE HELD PERSONALLY LIABLE OR RESPONSIBLE FOR ANY OBLIGATIONS OF ANY CUSTOMER ARISING OUT OF THIS AGREEMENT.

(h) Several Obligations of each Customer and Portfolio . WITH RESPECT TO ANY OBLIGATIONS OF A CUSTOMER ON BEHALF OF ANY OF ITS PORTFOLIOS ARISING OUT OF THIS AGREEMENT, BANK SHALL LOOK FOR PAYMENT OR SATISFACTION OF ANY SUCH OBLIGATION SOLELY TO THE ASSETS AND PROPERTY OF THE PORTFOLIO TO WHICH SUCH OBLIGATION RELATES AS THOUGH THAT CUSTOMER HAD SEPARATELY CONTRACTED WITH BANK BY SEPARATE WRITTEN AGREEMENT WITH RESPECT TO EACH OF ITS PORTFOLIOS. THE RIGHTS AND BENEFITS TO WHICH A GIVEN PORTFOLIO IS ENTITLED HEREUNDER SHALL BE SOLELY THOSE OF SUCH PORTFOLIO AND NO OTHER PORTFOLIO HEREUNDER SHALL RECEIVE SUCH BENEFITS.

IN WITNESS WHEREOF, each of the Customers and Bank have executed this Agreement as of the date first-written above. Execution of this Agreement by more than one Customer shall not create a contractual or other obligation between or among such Customers (or between or among their respective Portfolios) and this Agreement shall constitute a separate agreement between Bank and each Customer on behalf of itself or each of its Portfolios.

EACH OF THE CUSTOMERS LISTED ON

APPENDIX A ATTACHED HERETO, ON

BEHALF OF ITSELF OR ITS LISTED PORTFOLIOS

By: CAPITAL RESEARCH AND MANAGEMENT

COMPANY

By:____________________________________

Name:

Title:

JPMorgan Chase Bank, N.A.

By:________________________________________

Name:

Title: Vice President

APPENDIX A

CUSTOMERS AND PORTFOLIOS

Dated as of October 1, 2004

The following is a list of Customers and their respective Portfolios for which Bank shall serve under this Agreement.

CUSTOMER PORTFOLIO:

AMCAP Fund, Inc.

EuroPacific Growth Fund

New Perspective Fund, Inc.

Ne w World Fund, Inc.

American Mutual Fund, Inc.

Capital World Growth and Income Fund, Inc.

The Investment Company of America

Capital Income Builder, Inc.

The Income Fund of America, Inc.

American Balanced Fund, Inc.

American High Income Trust

The Bond Fund of America, Inc.

Capital World Bond Fund, Inc.

Intermediate Bond Fund of America

U.S. Government Securities Fund

American High-Income Municipal Bond Fund, Inc.

Limited Term Tax-Exempt Bond Fund of America

The Tax-Exempt Bond Fund of America, Inc.

The Tax-Exempt Fund of California

The Cash Management Trust of America

The Tax-Exempt Money Fund of America

The U.S. Treasury Money Fund of America

Endowments - Growth and Income Portfolio

Endowments - Bond Portfolio

Form of

AMENDED AND RESTATED ADMINISTRATIVE SERVICES AGREEMENT

WHEREAS, [Name of Fund] (the “Fund”), is a [Maryland corporation][Massachusetts business trust] registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end diversified investment company that offers Class [various] shares; and

WHEREAS, Capital Research and Management Company (the “Investment Adviser”), is a Delaware corporation registered under the Investment Advisers Act of 1940, as amended, and is engaged in the business of providing investment advisory and related services to the Fund and to other investment companies; and

WHEREAS, the Fund wishes to have the Investment Adviser arrange for and coordinate and monitor the provision of transfer agent and shareholder services (“transfer agent services”) and certain other administrative services (other than those provided pursuant to any other agreement with the Fund), including but not limited to recordkeeping, transactional services, tax information returns and reports, fund communication and shareholder communication (collectively “administrative services”) for the Fund’s Class [various] shares; and

WHEREAS, the Investment Adviser is willing to perform or to cause to be performed such transfer agent services and administrative services for the Fund’s Class [various] shares on the terms and conditions set forth herein; and

WHEREAS, the Fund and the Investment Adviser wish to enter into an Administrative Services Agreement (“Agreement”) whereby the Investment Adviser would perform or cause to be performed such transfer agent services and administrative services for the Fund’s Class [various] shares;

NOW, THEREFORE, the parties agree as follows:

1. Services . During the term of this Agreement, the Investment Adviser shall perform or cause to be performed the transfer agent services and administrative services set forth in Exhibit A hereto, as such exhibit may be amended from time to time by mutual consent of the parties. The Fund and Investment Adviser acknowledge that the Investment Adviser will contract with third parties, including American Funds Service Company (“AFS”), to perform such transfer agent services and administrative services. In selecting third parties to perform transfer agent and administrative services, the Investment Adviser shall select only those third parties that the Investment Adviser reasonably believes have adequate facilities and personnel to diligently perform such services. The Investment Adviser shall monitor, coordinate and oversee the activities of the third parties with which it or AFS contracts to ensure shareholders receive high-quality service. In doing so the Investment Adviser shall establish procedures to monitor the activities of such third parties. These procedures may, but need not, include monitoring: (i) telephone queue wait times; (ii) telephone abandon rates; (iii) website and voice response unit downtimes; (iv) downtime of the third party’s shareholder account recordkeeping system; (v) the accuracy and timeliness of financial and non-financial transactions; (vi) to ensure compliance with the Fund prospectus; and (vii) with respect to Class 529 shares, compliance with the CollegeAmerica program description.

2. Fees .

(a) Transfer Agent Fees. In consideration of transfer agent services performed or caused to be performed by the Investment Adviser for the Fund’s Class [various] shares, the Fund shall pay the Investment Adviser transfer agent fees according to the fee schedule contained in the Shareholder Services Agreement, as amended from time to time, between the Fund and AFS. No Transfer Agent Fees shall be paid in respect of accounts that are held in other than street name or a networked environment. No fees shall be paid under this paragraph 2(a) for services provided by third parties other than AFS. All fund-specific charges from third parties—including DST charges, postage, NSCC transaction charges and similar out-of-pocket expenses—will be passed through directly to the Fund. Transfer agent fees shall be paid within 30 days after receipt of an invoice for transfer agent services performed the preceding month.

(b) Administrative Services Fees. In consideration of administrative services performed or caused to be performed by the Investment Adviser for the Fund’s Class [various] shares, the Fund shall pay the Investment Adviser an administrative services fee (“administrative fee”). For the Fund’s Class [various] shares, the administrative fee shall accrue daily and shall be calculated at the annual rate of 0.15% of the average net assets of those shares. For the Fund’s Class R-5 shares, the administrative fee shall accrue daily and shall be calculated at the annual rate of 0.10% of the average net assets of the Class R-5 shares. The administrative fee shall be paid within 30 days after receipt of an invoice for administrative services performed in the preceding month.

3. Effective Date and Termination of Agreement . This Agreement shall become effective on [ date ], and unless terminated sooner it shall continue in effect until [ date ]. It may thereafter be continued from year to year only with the approval of a majority of those [Directors][Trustees] of the Fund who are not “interested persons” of the Fund (as defined in the 1940 Act) and have no direct or indirect financial interest in the operation of this Agreement or any agreement related to it (the “Independent [Directors][Trustees]”). This Agreement may be terminated as to the Fund as a whole or any class of shares individually at any time by vote of a majority of the Independent [Directors][Trustees]. The Investment Adviser may terminate this agreement upon sixty (60) days’ prior written notice to the Fund.

4. Amendment . This Agreement may not be amended to increase materially the fees payable under this Agreement unless such amendment is approved by the vote of a majority of the Independent [Directors][Trustees].

5. Assignment . This Agreement shall not be assignable by either party hereto and in the event of assignment shall automatically terminate forthwith. The term “assignment” shall have the meaning set forth in the 1940 Act. Notwithstanding the foregoing, the Investment Adviser is specifically authorized to contract with third parties for the provision of transfer agent, shareholder services, and administrative services on behalf of the Fund.

6. Issuance of Series of Shares . If the Fund shall at any time issue shares in more than one series, this Agreement may be adopted, amended, continued or renewed with respect to a series as provided herein, notwithstanding that such adoption, amendment, continuance or renewal has not been effected with respect to any one or more other series of the Fund.

7. Choice of Law . This Agreement shall be construed under and shall be governed by the laws of the State of California, and the parties hereto agree that proper venue of any action with respect hereto shall be Los Angeles County, California.

8. Limitation on Fees . Notwithstanding the foregoing, the portion of the administrative fees payable under this Agreement retained by the Investment Adviser (after all permissible payments to AFS and third party service providers) will be limited to no more than 0.05% of average net assets per share class.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in duplicate original by its officers thereunto duly authorized, as of [ date ], 2005.

CAPITAL RESEARCH AND

MANAGEMENT COMPANY

By:

[Name of Fund]

By:

EXHIBIT A

to the

Administrative Services Agreement

Transfer Agent Services

The Investment Adviser or any third party with whom it may contract, including American Funds Service Company (the Investment Adviser and any such third-party are collectively referred to as “Service Provider”) shall act, as necessary, as stock transfer agent, dividend disbursing agent and redemption agent for the Fund’s Class [various] shares, and shall provide such additional related services as the Fund’s Class [various] shares may from time to time require, all of which services are sometimes referred to herein as "shareholder services."

Administrative Services

1. Record Maintenance

The Service Provider shall maintain, and require any third parties with which it contracts to maintain with respect to each Fund shareholder holding the Fund’s Class [various] shares, in a Service Provider account (“Customers”) the following records:

a. Number of Shares;

b. Date, price and amount of purchases and redemptions (including dividend reinvestments) and dates and amounts of dividends paid for at least the current year to date;

c. Name and address of the Customer, including zip codes and social security numbers or taxpayer identification numbers;

d. Records of distributions and dividend payments; and

e. Any transfers of shares.

2. Shareholder Communications

Service Provider shall:

a. Provide to a shareholder mailing agent for the purpose of delivering certain Fund-related materials the names and addresses of all Customers. The Fund-related materials shall consist of updated prospectuses and any supplements and amendments thereto, annual and other periodic reports, proxy or information statements and other appropriate shareholder communications. In the alternative, the Service Provider may distribute the Fund-related materials to its Customers.

b. Deliver current Fund prospectuses and statements of additional information and annual and other periodic reports upon Customer request, and, as applicable, with confirmation statements;

c. Deliver statements to Customers on no less frequently than a quarterly basis showing, among other things, the number of Class [various] shares of the Fund owned by such Customer and the net asset value of the Class [various] shares of the Fund as of a recent date;

d. Produce and deliver to Customers confirmation statements reflecting purchases and redemptions of Class [various] shares of the Fund;

e. Respond to Customer inquiries regarding, among other things, share prices, account balances, dividend amounts and dividend payment dates;

f. With respect to Class [various] shares of the Fund purchased by Customers after the effective date of this Agreement, provide average cost basis reporting to Customers to assist them in preparation of their income tax returns; and

g. If the Service Provider accepts transactions in the Fund’s Class [various] shares from any brokers or banks in an omnibus relationship, require each such broker or bank to provide such shareholder communications as set forth in 2(a) through 2(f) to its own Customers.

3. Transactional Services

The Service Provider shall communicate to its Customers, as to Class [various] shares of the Fund, purchase, redemption and exchange orders reflecting the orders it receives from its Customers or from any brokers and banks for their Customers. The Service Provider shall also communicate to beneficial owners holding through it, and to any brokers or banks for beneficial owners holding through them, as to shares of Class [various] shares of the Fund, mergers, splits and other reorganization activities, and require any broker or bank to communicate such information to its Customers.

4. Tax Information Returns and Reports

The Service Provider shall prepare and file, and require to be prepared and filed by any brokers or banks as to their Customers, with the appropriate governmental agencies, such information, returns and reports as are required to be so filed for reporting: (i) dividends and other distributions made; (ii) amounts withheld on dividends and other distributions and payments under applicable federal and state laws, rules and regulations; and (iii) gross proceeds of sales transactions as required.

5. Fund Communications

The Service Provider shall, upon request by the Fund, on each business day, report the number of Class [various] shares on which the administrative fee is to be paid pursuant to this Agreement. The Service Provider shall also provide the Fund with a monthly invoice.

6. Monitoring of Service Providers

The Investment Adviser shall coordinate and monitor the activities of the Service Providers with which it contracts to ensure that the shareholders of the Fund’s Class [various] shares receive high-quality service. The Investment Adviser shall also ensure that Service Providers deliver to Customers account statements and all Fund-related materials, including prospectuses, shareholder reports, and proxies.

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

New World Fund, Inc.:

We consent to (a) the use in this Post-Effective Amendment 11 to Registration Statement No. 33-67455 on Form N-1A of our report dated December 14, 2005 appearing in the Financial Statements which are included in Part B, the Statement of Additional Information of such Registration Statement, (b) the references to us under the heading “General Information” in such Statement of Additional Information and (c) the reference to us under the heading “Financial Highlights” in the Prospectuses, which are part of such Registration Statement.

DELOITTE & TOUCHE LLP

Costa Mesa, California

Form of

AMENDED AND RESTATED

PLAN OF DISTRIBUTION

[Name of Fund]

relating to its

CLASS B SHARES

WHEREAS, [Name of Fund] (the “Fund”) is a [Maryland Corporation][Massachusetts business trust] that offers various classes of shares of [common stock][beneficial interest]; and

WHEREAS, American Funds Distributors, Inc. (“AFD”) or any successor entity designated by the Fund (AFD and any such successor collectively are referred to as “Distributor”) will serve as distributor of the shares of common stock of the Fund, and the Fund and Distributor are parties to a principal underwriting agreement (the “Agreement”); and

WHEREAS, the purpose of this Plan of Distribution (the “Plan”) is to authorize the Fund to bear expenses of distribution of its Class B shares; and

WHEREAS, the Board of [Directors][Trustees] of the Fund has determined that there is a reasonable likelihood that this Plan will benefit the Fund and its shareholders;

NOW, THEREFORE, the Fund adopts this Plan as follows:

1. Payments to Distributor . The Fund may expend pursuant to this Plan and as set forth below an aggregate amount not to exceed 1.00% per annum of the average net assets of the Fund’s Class B shares. Notwithstanding the foregoing, effective March 1, 2005, the Distributor will retain the Shareholder Servicing Fee as defined below (after all permissible payments to third parties) only with respect to accounts to which a broker-dealer other than the Distributor has been assigned. The categories of expenses are as follows:

Service Fees. The Fund shall pay to the Distributor monthly in arrears a shareholder servicing fee (the “Shareholder Servicing Fee”) at the rate of 0.25% per annum on the Fund’s Class B shares outstanding for less than one year. The Fund shall also pay to the Distributor quarterly a Shareholder Servicing Fee at the rate of 0.25% per annum on Class B shares that are outstanding for one year or more. The Shareholder Servicing Fee is designed to compensate Distributor for paying Service Fees to broker-dealers with whom Distributor has an agreement.

Distribution Fees. The Fund shall pay to the Distributor monthly in arrears its “Allocable Portion” (as described in Schedule A to this Plan “Allocation Schedule”, and until such time as the Fund designates a successor to AFD as distributor, the Allocable Portion shall equal 100%) of a fee (the “Distribution Fee”), which shall accrue each day in an amount equal to the product of (A) the daily equivalent of 0.75% per annum multiplied by (B) the net asset value of the Fund’s Class B shares outstanding on each day.

The Distributor may sell and assign its right to its Allocable Portion (but not its obligations to the Fund under the Agreement) of the Distribution Fee to a third party, and such transfer shall be free and clear of offsets or claims the Fund may have against the Distributor, it being understood that the Fund is not releasing the Distributor from any of its obligations to the Fund under the Agreement or any of the assets the Distributor continues to own. The Fund may agree, at the request of the Distributor, to pay the Allocable Portion of the Distribution Fee directly to the third party transferee.

Any Agreement between the Fund and the Distributor relating to the Fund’s Class B shares shall provide that:

(i)

the Distributor will be deemed to have performed all services required to be performed in order to be entitled to receive its Allocable Portion of the Distribution Fee payable in respect of each “Commission Share” (as defined in the Allocation Schedule) upon the settlement date of each sale of such Commission Share taken into account in determining such Distributor’s Allocable Portion of the Distribution Fee;

(ii)

notwithstanding anything to the contrary in this Plan or the Agreement, the Fund’s obligation to pay the Distributor its Allocable Portion of the Distribution Fee shall not be terminated or modified (including without limitation, by change in the rules applicable to the conversion of the Class B shares into shares of another class) for any reason (including a termination of this Plan or the Agreement between such Distributor and the Fund) except:

(a)

to the extent required by a change in the Investment Company Act of 1940 (the “1940 Act”), the rules and regulations under the 1940 Act, the Conduct Rules of the National Association of Securities Dealers, Inc. (the “NASD”), or any judicial decisions or interpretive pronouncements by the Securities and Exchange Commission, which is either binding upon the Distributor or generally complied with by similarly situated distributors of mutual fund shares, in each case enacted, promulgated, or made after March 15, 2000,

(b)

on a basis which does not alter the Distributor’s Allocable Portion of the Distribution Fee computed with reference to Commission Shares of the Fund, the Date of Original Issuance (as defined in the Allocation Schedule) of which occurs on or prior to the adoption of such termination or modification and with respect to Free Shares (as defined in the Allocation Schedule) which would be attributed to the Distributor under the Allocation Schedule with reference to such Commission Shares, or

(c)

in connection with a Complete Termination (as defined below) of this Plan by the Fund;

(iii) the Fund will not take any action to waive or change any contingent deferred sales charge (“CDSC”) in respect to the Class B shares, the Date of Original Issuance of which occurs on or prior to the taking of such action except as provided in the Fund’s prospectus or statement of additional information on the date such Commission Share was issued, without the consent of the Distributor or its assigns;

(iv) notwithstanding anything to the contrary in this Plan or the Agreement, none of the termination of the Distributor’s role as principal underwriter of the Class B shares of the Fund, the termination of the Agreement or the termination of this Plan will terminate the Distributor’s right to its Allocable Portion of the CDSCs in respect of Class B shares of the Fund;

(v) except as provided in (ii) above and notwithstanding anything to the contrary in this Plan or the Agreement, the Fund’s obligation to pay the Distributor’s Allocable Portion of the Distribution Fees and CDSCs payable in respect of the Class B shares of the Fund shall be absolute and unconditional and shall not be subject to dispute, offset, counterclaim or any defense whatsoever, at law or equity, including, without limitation, any of the foregoing based on the insolvency or bankruptcy of the Distributor; and

(vi) until the Distributor has been paid its Allocable Portion of the Distribution Fees in respect of the Class B shares of the Fund, the Fund will not adopt a plan of liquidation in respect of the Class B shares without the consent of the Distributor and its assigns. For purposes of this Plan, the term Allocable Portion of the Distribution Fees or CDSCs payable in respect of the Class B shares as applied to any Distributor shall mean the portion of such Distribution Fees or CDSCs payable in respect of such Class B shares of the Fund allocated to the Distributor in accordance with the Allocation Schedule as it relates to the Class B shares of the Fund, and until such time as the Fund designates a successor to AFD as distributor, the Allocable Portion shall equal 100% of the Distribution Fees and CDSCs. For purposes of this Plan, the term “Complete Termination” in respect of this Plan as it relates to the Class B shares means a termination of this Plan involving the complete cessation of the payment of Distribution Fees in respect of all Class B shares, the termination of the distribution plans and principal underwriting agreements, and the complete cessation of the payment of any asset based sales charge (within the meaning of the Conduct Rules of the NASD) or similar fees in respect of the Fund and any successor mutual fund or any mutual fund acquiring a substantial portion of the assets of the Fund (the Fund and such other mutual funds hereinafter referred to as the “Affected Funds”) and in respect of the Class B shares and every future class of shares (other than future classes of shares established more than eight years after the date of such termination) which has substantially similar characteristics to the Class B shares (all such classes of shares the “Affected Classes of Shares”) of such Affected Funds taking into account the manner of payment and amount of asset based sales charge, CDSC or other similar charges borne directly or indirectly by the holders of such shares; provided that

(a) the Board of [Directors][Trustees] of such Affected Funds, including the Independent [Directors][Trustees] (as defined below) of the Affected Funds, shall have determined that such termination is in the best interest of such Affected Funds and the shareholders of such Affected Funds, and

(b) such termination does not alter the CDSC as in effect at the time of such termination applicable to Commission Shares of the Fund, the Date of Original Issuance of which occurs on or prior to such termination.

Notwithstanding the foregoing, the Distributor will retain such fees (after all permissible payments to third parties) only with respect to accounts to which a broker-dealer other than the Distributor has been assigned.

2. Approval by the Board . This Plan shall not take effect until it has been approved, together with any related agreement, by votes of the majority of both (i) the Board of [Directors][Trustees] of the Fund and (ii) those [Directors][Trustees] of the Fund who are not “interested persons” of the Fund (as defined in the 1940 Act) and have no direct or indirect financial interest in the operation of this Plan or any agreement related to it (the “Independent [Directors][Trustees]”), cast in person at a meeting called for the purpose of voting on this Plan and/or such agreement.

3. Review of Expenditures . At least quarterly, the Board of [Directors][Trustees] shall be provided by any person authorized to direct the disposition of monies paid or payable by the Fund pursuant to this Plan or any related agreement, and the Board shall review, a written report of the amounts expended pursuant to this Plan and the purposes for which such expenditures were made.

4. Termination of Plan . This Plan may be terminated as to the Fund’s Class B shares at any time by vote of a majority of the Independent [Directors][Trustees], or by vote of a majority of the outstanding Class B shares of the Fund. Unless sooner terminated in accordance with this provision, this Plan shall continue in effect until December 31, 2005. It may thereafter be continued from year to year in the manner provided for in paragraph 2 hereof.

Notwithstanding the foregoing or paragraph 6, below, any amendment or termination of this Plan shall not affect the rights of the Distributor to receive its Allocable Portion of the Distribution Fee, unless the termination constitutes a Complete Termination of this Plan as described in paragraph 1 above.

5. Requirements of Agreement . Any Agreement related to this Plan shall be in writing, and shall provide:

that such agreement may be terminated as to the Fund at any time, without payment of any penalty by the vote of a majority of the Independent [Directors][Trustees] or by a vote of a majority of the outstanding Class B shares of the Fund, on not more than sixty (60) days’ written notice to any other party to the agreement; and

that such agreement shall terminate automatically in the event of its assignment.

6. Amendment . This Plan may not be amended to increase materially the maximum amount of fee or other distribution expenses provided for in paragraph 1 hereof with respect to the Class B shares of the Fund unless such amendment is approved by vote of a majority of the outstanding voting securities of the Class B shares of the Fund and as provided in paragraph 2 hereof, and no other material amendment to this Plan shall be made unless approved in the manner provided for in paragraph 2 hereof.

7. Nomination of [Directors][Trustees] . While this Plan is in effect, the selection and nomination of Independent [Directors][Trustees] shall be committed to the discretion of the Independent [Directors][Trustees] of the Fund.

8. Issuance of Series of Shares . If the Fund shall at any time issue shares in more than one series, this Plan may be adopted, amended, continued or renewed with respect to a series as provided herein, notwithstanding that such adoption, amendment, continuance or renewal has not been effected with respect to any one or more other series of the Fund.

9. Record Retention . The Fund shall preserve copies of this Plan and any related agreement and all reports made pursuant to paragraph 3 hereof for not less than six (6) years from the date of this Plan, or such agreement or reports, as the case may be, the first two (2) years of which such records shall be stored in an easily accessible place.

IN WITNESS WHEREOF, the Fund has caused this Plan to be executed by its officers thereunto duly authorized, as of [ date], 2005.

[Name of Fund]

SCHEDULE A

to the

Plan of Distribution of

[Name of Fund]

relating to its Class B shares

ALLOCATION SCHEDULE

The following relates solely to Class B shares.

The Distributor's Allocable Portion of Distribution Fees and CDSCs in respect of Class B shares shall be 100% until such time as the Distributor shall cease to serve as exclusive distributor of Class B shares; thereafter, collections that constitute CDSCs and Distribution Fees relating to Class B shares shall be allocated among the Distributor and any successor distributor (" Successor Distributor ") in accordance with this Schedule.

Defined terms used in this Schedule and not otherwise defined herein shall have the meanings assigned to them in the Amended and Restated Principal Underwriting Agreement (the “Distribution Agreement”), of which this Schedule is a part. As used herein the following terms shall have the meanings indicated:

" Commission Share " means each B share issued under circumstances which would normally give rise to an obligation of the holder of such share to pay a CDSC upon redemption of such share (including, without limitation, any B share issued in connection with a permitted free exchange), and any such share shall continue to be a Commission Share of the applicable Fund prior to the redemption (including a redemption in connection with a permitted free exchange) or conversion of such share, even though the obligation to pay the CDSC may have expired or conditions for waivers thereof may exist.

" Date of Original Issuance " means in respect of any Commission Share, the date with reference to which the amount of the CDSC payable on redemption thereof, if any, is computed.

" Free Share " means, in respect of a Fund, each B share of the Fund, other than a Commission Share (including, without limitation, any B share issued in connection with the reinvestment of dividends or capital gains).

" Inception Date " means in respect of a Fund, the first date on which the Fund issued shares.

" Net Asset Value " means the net asset value determined as set forth in the Prospectus of each Fund.

" Omnibus Share " means, in respect of a Fund, a Commission Share or Free Share sold by one of the selling agents listed on [Exhibit I]. If, subsequent to the Successor Distributor becoming exclusive distributor of the Class B shares, the Distributor reasonably determines that the transfer agent is able to track all Commission Shares and Free Shares sold by any of the selling agents listed on Exhibit I in the same manner as Commission Shares and Free Shares are currently tracked in respect of selling agents not listed on Exhibit I, then Exhibit I shall be amended to delete such selling agent from Exhibit I so that Commission Shares and Free Shares sold by such selling agent will no longer be treated as Omnibus Shares.

PART I: ATTRIBUTION OF CLASS B SHARES

Class B shares that are outstanding from time to time, shall be attributed to the Distributor and each Successor Distributor in accordance with the following rules;

(1) Commission Shares other than Omnibus Shares :

(a) Commission Shares that are not Omnibus Shares (“Non-Omnibus Commission Shares”) attributed to the Distributor shall be those Non-Omnibus Commission Shares the date of Original Issuance of which occurred on or after the Inception Date of the applicable Fund and on or prior to the date the Distributor ceased to be exclusive distributor of Class B shares of the Fund.

(b) Non-Omnibus Commission Shares attributable to each Successor Distributor shall be those Non-Omnibus Commission Shares the Date of Original Issuance of which occurs after the date such Successor Distributor became the exclusive distributor of Class B shares of the Fund and on or prior to the date such Successor Distributor ceased to be the exclusive distributor of Class B shares of the Fund.

(c) A Non-Omnibus Commission Share of a Fund issued in consideration of the investment of proceeds of the redemption of a Non-Omnibus Commission Share of another Fund (the " Redeeming Fund ") in connection with a permitted free exchange, is deemed to have a Date of Original Issuance identical to the Date of Original Issuance of the Non-Omnibus Commission Share of the Redeeming Fund, and any such Commission Share will be attributed to the Distributor or Successor Distributor based upon such Date of Original Issuance in accordance with rules (a) and (b) above.

(2) Free Shares :

Free Shares that are not Omnibus Shares (“Non-Omnibus Free Shares”) of a Fund outstanding on any date shall be attributed to the Distributor or a Successor Distributor, as the case may be, in the same proportion that the Non-Omnibus Commission Shares of a Fund outstanding on such date are attributed to each on such date; provided that if the Distributor and its transferees reasonably determines that the transfer agent is able to produce monthly reports that track the Date of Original Issuance for such Non-Omnibus Free Shares, then such Free Shares shall be allocated pursuant to clause 1(a), (b) and (c) above.

(3) Omnibus Shares :

Omnibus Shares of a Fund outstanding on any date shall be attributed to the Distributor or a Successor Distributor, as the case may be, in the same proportion that the Non-Omnibus Commission Shares of the applicable Fund outstanding on such date are attributed to it on such date; provided that if the Distributor reasonably determines that the transfer agent is able to produce monthly reports that track the Date of Original Issuance for the Omnibus Shares, then the Omnibus Shares shall be allocated pursuant to clause 1(a), (b) and (c) above.

PART II: ALLOCATION OF CDSCs

(1) CDSCs Related to the Redemption of Non-Omnibus Commission Shares :

CDSCs in respect of the redemption of Non-Omnibus Commission Shares shall be allocated to the Distributor or a Successor Distributor depending upon whether the related redeemed Commission Share is attributable to the Distributor or such Successor Distributor, as the case may be, in accordance with Part I above.

(2) CDSCs Related to the Redemption of Omnibus Shares :

CDSCs in respect of the redemption of Omnibus Shares shall be allocated to the Distributor or a Successor Distributor in the same proportion that CDSCs related to the redemption of Commission Shares are allocated to each thereof; provided , that if the Distributor reasonably determines that the transfer agent is able to produce monthly reports which track the Date of Original Issuance for the Omnibus Shares, then the CDSCs in respect of the redemption of Omnibus Shares shall be allocated among the Distributor and any Successor Distributor depending on whether the related redeemed Omnibus Share is attributable to the Distributor or a Successor Distributor, as the case may be, in accordance with Part I above.

PART III: ALLOCATION OF DISTRIBUTION FEE

Assuming that the Distribution Fee remains constant over time so that Part IV hereof does not become operative:

(1) The portion of the aggregate Distribution Fee accrued in respect of all Class B shares of a Fund during any calendar month allocable to the Distributor or a Successor Distributor is determined by multiplying the total of such Distribution Fee by the following fraction:

(A + C)/2

(B + D)/2

where:

A=	The aggregate Net Asset Value of all Class B shares of a Fund attributed to the Distributor or such Successor Distributor, as the case may be, and outstanding at the beginning of such calendar month

B=	The aggregate Net Asset Value of all Class B shares of a Fund at the beginning of such calendar month

C=	The aggregate Net Asset Value of all Class B shares of a Fund attributed to the Distributor or such Successor Distributor, as the case may be, and outstanding at the end of such calendar month

D=	The aggregate Net Asset Value of all Class B shares of a Fund at the end of such calendar month

(2) If the Distributor reasonably determines that the transfer agent is able to produce automated monthly reports that allocate the average Net Asset Value of the Commission Shares (or all Class B shares if available) of a Fund among the Distributor and any Successor Distributor in a manner consistent with the methodology detailed in Part I and Part III(1) above, the portion of the Distribution Fee accrued in respect of all such Class B shares of a Fund during a particular calendar month will be allocated to the Distributor or a Successor Distributor by multiplying the total of such Distribution Fee by the following fraction:

(A)/(B)

where:

A=	Average Net Asset Value of all such Class B shares of a Fund for such calendar month attributed to the Distributor or a Successor Distributor, as the case may be

B=	Total average Net Asset Value of all such Class B shares of a Fund for such calendar month

PART IV: ADJUSTMENT OF THE DISTRIBUTOR'S ALLOCABLE PORTION AND EACH SUCCESSOR DISTRIBUTOR'S ALLOCABLE PORTION

The parties to the Distribution Agreement recognize that, if the terms of any distributor's contract, any distribution plan, any prospectus, the Conduct Rules or any other applicable law change so as to disproportionately reduce, in a manner inconsistent with the intent of this Distribution Agreement, the amount of the Distributor's Allocable Portion or any Successor Distributor's Allocable Portion had no such change occurred, the definitions of the Distributor's Allocable Portion and/or the Successor Distributor's Allocable Portion in respect of the Class B shares relating to a Fund shall be adjusted by agreement among the relevant parties; provided , however , if the Distributor, the Successor Distributor and the Fund cannot agree within thirty (30) days after the date of any such change in applicable laws or in any distributor's contract, distribution plan, prospectus or the Conduct Rules, they shall submit the question to arbitration in accordance with the commercial arbitration rules of the American Arbitration Association and the decision reached by the arbitrator shall be final and binding on each of them.

Form of

AMENDED AND RESTATED

PLAN OF DISTRIBUTION

[Name of Fund]

relating to its

CLASS C SHARES

WHEREAS, [Name of Fund] (the “Fund”) is a [Maryland Corporation][Massachusetts business trust] that offers various classes of shares of [common stock][shares of beneficial interest]; and

WHEREAS, the purpose of this Plan of Distribution (the “Plan”) is to authorize the Fund to bear expenses of distribution of its Class C shares; and

WHEREAS, the Board of [Directors][Trustees] of the Fund has determined that there is a reasonable likelihood that this Plan will benefit the Fund and its shareholders;

NOW, THEREFORE, the Fund adopts this Plan as follows:

Service Fees. The Fund shall pay to the Distributor no more frequently than monthly in arrears a service fee (the “Service Fee”), which shall accrue daily in an amount equal to the daily equivalent of 0.25% per annum of the net asset value of the Fund’s Class C shares outstanding on each day. The Service Fee compensates the Distributor for paying service-related expenses, including Service Fees to others in respect of Class C shares of the Fund.

Distribution Fees. The Fund shall pay to the Distributor no more frequently than monthly in arrears its “Allocable Portion” (as described in Schedule A to this Plan “Allocation Schedule”, and until such time as the Fund designates a successor to AFD as distributor, the Allocable Portion shall equal 100%) of a fee (the “Distribution Fee”), which shall accrue daily in an amount equal to the daily equivalent of 0.75% per annum of the net asset value of the Fund’s Class C shares outstanding on each day. The Distribution Fee compensates the Distributor for providing distribution and sales-related services in respect of Class C shares of the Fund.

Any Agreement between the Fund and the Distributor relating to the Fund’s Class C shares shall provide that:

(i)

(ii)

notwithstanding anything to the contrary in this Plan or the Agreement, the Fund’s obligation to pay the Distributor its Allocable Portion of the Distribution Fee shall not be terminated or modified (including without limitation, by change in the rules applicable to the conversion of the Class C shares into shares of another class) for any reason (including a termination of this Plan or the Agreement between such Distributor and the Fund) except:

(a)

(b)

(c)

in connection with a Complete Termination (as defined below) of this Plan by the Fund;

(iii)

the Fund will not take any action to waive or change any contingent deferred sales charge (“CDSC”) in respect of the Class C shares, the Date of Original Issuance of which occurs on or prior to the taking of such action except as provided in the Fund’s prospectus or statement of additional information on the date such Commission Share was issued, without the consent of the Distributor or its assigns;

(iv) notwithstanding anything to the contrary in this Plan or the Agreement, none of the termination of the Distributor’s role as principal underwriter of the Class C shares of the Fund, the termination of the Agreement or the termination of this Plan will terminate the Distributor’s right to its Allocable Portion of the CDSCs in respect of Class C shares of the Fund;

(v)

except as provided in (ii) above and notwithstanding anything to the contrary in this Plan or the Agreement, the Fund’s obligation to pay the Distributor’s Allocable Portion of the Distribution Fees and CDSCs payable in respect of the Class C shares of the Fund shall be absolute and unconditional and shall not be subject to dispute, offset, counterclaim or any defense whatsoever, at law or equity, including, without limitation, any of the foregoing based on the insolvency or bankruptcy of the Distributor; and

(vi)

until the Distributor has been paid its Allocable Portion of the Distribution Fees in respect of the Class C shares of the Fund, the Fund will not adopt a plan of liquidation in respect of the Class C shares without the consent of the Distributor and its assigns. For purposes of this Plan, the term Allocable Portion of the Distribution Fees or CDSCs payable in respect of the Class C shares as applied to any Distributor shall mean the portion of such Distribution Fees or CDSCs payable in respect of such Class C shares of the Fund allocated to the Distributor in accordance with the Allocation Schedule as it relates to the Class C shares of the Fund, and until such time as the Fund designates a successor to AFD as distributor, the Allocable Portion shall equal 100% of the Distribution Fees and CDSCs. For purposes of this Plan, the term “Complete Termination” in respect of this Plan as it relates to the Class C shares means a termination of this Plan involving the complete cessation of the payment of Distribution Fees in respect of all Class C shares, the termination of the distribution plans and principal underwriting agreements, and the complete cessation of the payment of any asset based sales charge (within the meaning of the Conduct Rules of the NASD) or similar fees in respect of the Fund and any successor mutual fund or any mutual fund acquiring a substantial portion of the assets of the Fund (the Fund and such other mutual funds hereinafter referred to as the “Affected Funds”) and in respect of the Class C shares and every future class of shares (other than future classes of shares established more than one year after the date of such termination) which has substantially similar characteristics to the Class C shares (all such classes of shares the “Affected Classes of Shares”) of such Affected Funds taking into account the manner of payment and amount of asset based sales charge, CDSC or other similar charges borne directly or indirectly by the holders of such shares; provided that

4. Termination of Plan . This Plan may be terminated as to the Fund’s Class C shares at any time by vote of a majority of the Independent [Directors][Trustees], or by vote of a majority of the outstanding Class C shares of the Fund. Unless sooner terminated in accordance with this provision, this Plan shall continue in effect until December 31, 2005. It may thereafter be continued from year to year in the manner provided for in paragraph 2 hereof.

5. Requirements of Agreement . Any Agreement related to this Plan shall be in writing, and shall provide:

a. that such agreement may be terminated as to the Fund at any time, without payment of any penalty by the vote of a majority of the Independent [Directors][Trustees] or by a vote of a majority of the outstanding Class C shares of the Fund, on not more than sixty (60) days’ written notice to any other party to the agreement; and

that such agreement shall terminate automatically in the event of its assignment.

6. Amendment . This Plan may not be amended to increase materially the maximum amount of fees or other distribution expenses provided for in paragraph 1 hereof with respect to the Class C shares of the Fund unless such amendment is approved by vote of a majority of the outstanding voting securities of the Class C shares of the Fund and as provided in paragraph 2 hereof, and no other material amendment to this Plan shall be made unless approved in the manner provided for in paragraph 2 hereof.

IN WITNESS WHEREOF, the Fund has caused this Plan to be executed by its officers thereunto duly authorized, as of [ date ], 2005.

[Name of Fund]

By ______________________________

SCHEDULE A

to the

Plan of Distribution of

[Name of Fund]

relating to its Class C shares

ALLOCATION SCHEDULE

The following relates solely to Class C shares.

The Distributor's Allocable Portion of Distribution Fees and CDSCs in respect of Class C shares shall be 100% until such time as the Distributor shall cease to serve as exclusive distributor of Class C shares; thereafter, collections that constitute CDSCs and Distribution Fees relating to Class C shares shall be allocated among the Distributor and any successor distributor (" Successor Distributor ") in accordance with this Schedule. At such time as the Distributor’s Allocable Portion of the Distribution Fees equals zero, the Successor Distributor shall become the Distributor for purposes of this Allocation Schedule.

" Commission Share " means each C share issued under circumstances which would normally give rise to an obligation of the holder of such share to pay a CDSC upon redemption of such share (including, without limitation, any C share issued in connection with a permitted free exchange), and any such share shall continue to be a Commission Share of the applicable Fund prior to the redemption (including a redemption in connection with a permitted free exchange) or conversion of such share, even though the obligation to pay the CDSC may have expired or conditions for waivers thereof may exist.

" Date of Original Issuance " means in respect of any Commission Share, the date with reference to which the amount of the CDSC payable on redemption thereof, if any, is computed.

" Free Share " means, in respect of a Fund, each C share of the Fund, other than a Commission Share (including, without limitation, any C share issued in connection with the reinvestment of dividends or capital gains).

" Inception Date " means in respect of a Fund, the first date on which the Fund issued shares.

" Net Asset Value " means the net asset value determined as set forth in the Prospectus of each Fund.

" Omnibus Share " means, in respect of a Fund, a Commission Share or Free Share sold by one of the selling agents maintaining shares in an omnibus account (“Omnibus Selling Agents”). If, subsequent to the Successor Distributor becoming exclusive distributor of the Class C shares, the Distributor reasonably determines that the transfer agent is able to track all Commission Shares and Free Shares sold by any of the Omnibus Selling Agents in the same manner that Non-Omnibus Commission Shares and Free Shares (defined below) are currently tracked, then Omnibus Shares of such Omnibus Selling Agent shall be treated as Commission Shares and Free Shares.

PART I: ATTRIBUTION OF CLASS C SHARES

Class C shares that are outstanding from time to time, shall be attributed to the Distributor and each Successor Distributor in accordance with the following rules;

(1) Commission Shares other than Omnibus Shares :

(a) Commission Shares that are not Omnibus Shares (“Non-Omnibus Commission Shares”) attributed to the Distributor shall be those Non-Omnibus Commission Shares (i) the date of Original Issuance of which occurred on or after the Inception Date of the applicable Fund and on or prior to the date the Distributor ceased to be exclusive distributor of Class C shares of the Fund and (ii) that are subject to a CDSC (without regard to any conditions for waivers thereof).

(b) Non-Omnibus Commission Shares attributable to each Successor Distributor shall be those Non-Omnibus Commission Shares (i) the Date of Original Issuance of which occurs after the date such Successor Distributor became the exclusive distributor of Class C shares of the Fund and on or prior to the date such Successor Distributor ceased to be the exclusive distributor of Class C shares of the Fund and (ii) that are subject to a CDSC (without regard to any conditions for waivers thereof).

(2) Free Shares :

(3) Omnibus Shares :

PART II: ALLOCATION OF CDSCs

(1) CDSCs Related to the Redemption of Non-Omnibus Commission Shares :

(2) CDSCs Related to the Redemption of Omnibus Shares :

CDSCs in respect of the redemption of Omnibus Shares shall be allocated to the Distributor or a Successor Distributor in the same proportion that CDSCs related to the redemption of Non-Omnibus Commission Shares are allocated to each thereof; provided , that if the Distributor reasonably determines that the transfer agent is able to produce monthly reports which track the Date of Original Issuance for the Omnibus Shares, then the CDSCs in respect of the redemption of Omnibus Shares shall be allocated among the Distributor and any Successor Distributor depending on whether the related redeemed Omnibus Share is attributable to the Distributor or a Successor Distributor, as the case may be, in accordance with Part I above.

PART III: ALLOCATION OF DISTRIBUTION FEE

Assuming that the Distribution Fee remains constant over time so that Part IV hereof does not become operative:

(1) The portion of the aggregate Distribution Fee accrued in respect of all Class C shares of a Fund during any calendar month allocable to the Distributor or a Successor Distributor is determined by multiplying the total of such Distribution Fee by the following fraction:

(A + C)/2

(B + D)/2

where:

A=	The aggregate Net Asset Value of all Class C shares of a Fund attributed to the Distributor or such Successor Distributor, as the case may be, and outstanding at the beginning of such calendar month

B=	The aggregate Net Asset Value of all Class C shares of a Fund at the beginning of such calendar month

C=	The aggregate Net Asset Value of all Class C shares of a Fund attributed to the Distributor or such Successor Distributor, as the case may be, and outstanding at the end of such calendar month

D=	The aggregate Net Asset Value of all Class C shares of a Fund at the end of such calendar month

(2) If the Distributor reasonably determines that the transfer agent is able to produce automated monthly reports that allocate the average Net Asset Value of the Commission Shares (or all Class C shares if available) of a Fund among the Distributor and any Successor Distributor in a manner consistent with the methodology detailed in Part I and Part III(1) above, the portion of the Distribution Fee accrued in respect of all such Class C shares of a Fund during a particular calendar month will be allocated to the Distributor or a Successor Distributor by multiplying the total of such Distribution Fee by the following fraction:

(A)/(B)

where:

A=	Average Net Asset Value of all such Class C shares of a Fund for such calendar month attributed to the Distributor or a Successor Distributor, as the case may be

B=	Total average Net Asset Value of all such Class C shares of a Fund for such calendar month

PART IV: ADJUSTMENT OF THE DISTRIBUTOR'S ALLOCABLE PORTION AND EACH SUCCESSOR DISTRIBUTOR'S ALLOCABLE PORTION

The parties to the Distribution Agreement recognize that, if the terms of any distributor's contract, any distribution plan, any prospectus, the Conduct Rules or any other applicable law change so as to disproportionately reduce, in a manner inconsistent with the intent of this Distribution Agreement, the amount of the Distributor's Allocable Portion or any Successor Distributor's Allocable Portion had no such change occurred, the definitions of the Distributor's Allocable Portion and/or the Successor Distributor's Allocable Portion in respect of the Class C shares relating to a Fund shall be adjusted by agreement among the relevant parties; provided , however , if the Distributor, the Successor Distributor and the Fund cannot agree within thirty (30) days after the date of any such change in applicable laws or in any distributor's contract, distribution plan, prospectus or the Conduct Rules, they shall submit the question to arbitration in accordance with the commercial arbitration rules of the American Arbitration Association and the decision reached by the arbitrator shall be final and binding on each of them.

Form of

AMENDED AND RESTATED

PLAN OF DISTRIBUTION

[Name of Fund]

relating to its

CLASS F SHARES

WHEREAS, [Name of Fund] (the “Fund”) is a [Maryland Corporation][Massachusets business trust] that offers various classes of shares of [common stock][beneficial interest]; and

WHEREAS, American Funds Distributors, Inc. (“AFD”) or any successor entity designated by the Fund (AFD and any such successor collectively are referred to as “Distributor”) will serve as distributor of the shares of [common stock][beneficial interest] of the Fund, and the Fund and Distributor are parties to a principal underwriting agreement (the “Agreement”); and

WHEREAS, the purpose of this Plan of Distribution (the “Plan”) is to authorize the Fund to bear expenses of distribution of its Class F shares; and

WHEREAS, the Board of [Directors][Trustees] of the Fund has determined that there is a reasonable likelihood that this Plan will benefit the Fund and its shareholders;

NOW, THEREFORE, the Fund adopts this Plan as follows:

1. Payments to Distributor . The Fund may expend pursuant to this Plan and as set forth below an aggregate amount not to exceed 0.50% per annum of the average net assets of the Fund’s Class F shares.

The categories of expenses permitted under this Plan include service fees (“Service Fees”) and distribution fees (“Distribution Fees”), each in an amount not to exceed 0.25% per annum of the average net assets of the Fund’s Class F shares. The actual amounts paid shall be determined by the Board of [Directors][Trustees]. The Service Fee compensates the Distributor for service-related expenses, including paying Service Fees to others in respect of Class F shares of the Fund. The Distribution Fee compensates the Distributor for providing distribution services in respect of Class F shares of the Fund.

2. Approval by the Board . This Plan shall not take effect until it has been approved, together with any related agreement, by votes of the majority of both (i) the Board of [Directors][Trustees] of the Fund and (ii) those [Directors][Trustees] of the Fund who are not “interested persons” of the Fund (as defined in the Investment Company Act of 1940) and have no direct or indirect financial interest in the operation of this Plan or any agreement related to it (the “Independent [Directors][Trustees]”), cast in person at a meeting called for the purpose of voting on this Plan and/or such agreement.

4. Termination of Plan . This Plan may be terminated as to the Fund’s Class F shares at any time by vote of a majority of the Independent [Directors][Trustees], or by vote of a majority of the outstanding Class F shares of the Fund. Unless sooner terminated in accordance with this provision, this Plan shall continue in effect until December 31, 2005. It may thereafter be continued from year to year in the manner provided for in paragraph 2 hereof.

5. Requirements of Agreement . Any Agreement related to this Plan shall be in writing, and shall provide:

a. that such agreement may be terminated as to the Fund at any time, without payment of any penalty by the vote of a majority of the Independent [Directors][Trustees] or by a vote of a majority of the outstanding Class F shares of the Fund, on not more than sixty (60) days’ written notice to any other party to the agreement; and

that such agreement shall terminate automatically in the event of its assignment.

6. Amendment . This Plan may not be amended to increase materially the maximum amount of fees or other distribution expenses provided for in paragraph 1 hereof with respect to the Class F shares of the Fund unless such amendment is approved by vote of a majority of the outstanding voting securities of the Class F shares of the Fund and as provided in paragraph 2 hereof, and no other material amendment to this Plan shall be made unless approved in the manner provided for in paragraph 2 hereof.

IN WITNESS WHEREOF, the Fund has caused this Plan to be executed by its officers thereunto duly authorized, as of [ date ], 2005.

[Name of Fund]

By ______________________________

Form of

AMENDED AND RESTATED

PLAN OF DISTRIBUTION

[Name of Fund]

relating to its

CLASS 529-B SHARES

WHEREAS, [Name of Fund] (the “Fund”) is a [Maryland corporation][Massachusetts business trust] that offers various classes of shares of common stock; and

WHEREAS, the purpose of this Plan of Distribution (the “Plan”) is to authorize the Fund to bear expenses of distribution of its Class 529-B shares; and

WHEREAS, the Board of [Directors][Trustees] of the Fund has determined that there is a reasonable likelihood that this Plan will benefit the Fund and its shareholders;

NOW, THEREFORE, the Fund adopts this Plan as follows:

1. Payments to Distributor . The Fund may expend pursuant to this Plan and as set forth below an aggregate amount not to exceed 1.00% per annum of the average net assets of the Fund’s Class 529-B shares. Notwithstanding the foregoing, effective March 1, 2005, the Distributor will retain the Service Fee as defined below (after all permissible payments to third parties) only with respect to accounts to which a broker-dealer other than the Distributor has been assigned. The categories of expenses are as follows:

Service Fees. The Fund shall pay to the Distributor no more frequently than monthly in arrears a service fee (the “Service Fee”), which shall accrue daily in an amount equal to the daily equivalent of 0.25% per annum of the net asset value of the Fund’s Class 529-B shares outstanding on each day. The Service Fee compensates the Distributor for paying service-related expenses, including Service Fees to others in respect of Class 529-B shares of the Fund.

Distribution Fees. The Fund shall pay to the Distributor monthly in arrears its “Allocable Portion” as described in Schedule A to this Plan (“Allocation Schedule”), and until such time as the Fund designates a successor to AFD as distributor, the Allocable Portion shall equal 100% of a fee (the “Distribution Fee”), which shall accrue daily in an amount equal to the daily equivalent of 0.75% per annum of the net asset value of the Fund’s Class 529-B shares outstanding on each day. The Distribution Fee compensates the Distributor for providing distribution and sales-related services in respect of Class 529-B shares of the Fund.

Any Agreement between the Fund and the Distributor relating to the Fund’s Class 529-B shares shall provide that:

(i)

(ii)

notwithstanding anything to the contrary in this Plan or the Agreement, the Fund’s obligation to pay the Distributor its Allocable Portion of the Distribution Fee shall not be terminated or modified (including without limitation, by change in the rules applicable to the conversion of the Class 529-B shares into shares of another class) for any reason (including a termination of this Plan or the Agreement between such Distributor and the Fund) except:

(a)

(b)

(c)

in connection with a Complete Termination (as defined below) of this Plan by the Fund;

(iii) the Fund will not take any action to waive or change any contingent deferred sales charge (“CDSC”) in respect of the Class 529-B shares, the Date of Original Issuance of which occurs on or prior to the taking of such action except as provided in the Fund’s prospectus or statement of additional information on the date such Commission Share was issued, without the consent of the Distributor or its assigns;

(iv) notwithstanding anything to the contrary in this Plan or the Agreement, none of the termination of the Distributor’s role as principal underwriter of the Class 529-B shares of the Fund, the termination of the Agreement or the termination of this Plan will terminate the Distributor’s right to its Allocable Portion of the CDSCs in respect of Class 529-B shares of the Fund;

(v) except as provided in (ii) above and notwithstanding anything to the contrary in this Plan or the Agreement, the Fund’s obligation to pay the Distributor’s Allocable Portion of the Distribution Fees and CDSCs payable in respect of the Class 529-B shares of the Fund shall be absolute and unconditional and shall not be subject to dispute, offset, counterclaim or any defense whatsoever, at law or equity, including, without limitation, any of the foregoing based on the insolvency or bankruptcy of the Distributor; and

(vi)

until the Distributor has been paid its Allocable Portion of the Distribution Fees in respect of the Class 529-B shares of the Fund, the Fund will not adopt a plan of liquidation in respect of the Class 529-B shares without the consent of the Distributor and its assigns. For purposes of this Plan, the term Allocable Portion of the Distribution Fees or CDSCs payable in respect of the Class 529-B shares as applied to any Distributor shall mean the portion of such Distribution Fees or CDSCs payable in respect of such Class 529-B shares of the Fund allocated to the Distributor in accordance with the Allocation Schedule as it relates to the Class 529-B shares of the Fund, and until such time as the Fund designates a successor to AFD as distributor, the Allocable Portion shall equal 100% of the Distribution Fees and CDSCs. For purposes of this Plan, the term “Complete Termination” in respect of this Plan as it relates to the Class 529-B shares means a termination of this Plan involving the complete cessation of the payment of Distribution Fees in respect of all Class 529-B shares and all Class B shares, the termination of the distribution plans relating to Class 529-B shares and Class B shares and principal underwriting agreements with respect to Class 529-B shares and Class B shares, and the complete cessation of the payment of any asset based sales charge (within the meaning of the Conduct Rules of the NASD) or similar fees in respect of all Class 529-B shares and all Class B shares of the Fund and any successor mutual fund or any mutual fund acquiring a substantial portion of the assets of the Fund (the Fund and such other mutual funds hereinafter referred to as the “Affected Funds”) and in respect of the Class 529-B shares, the Class B Shares and every future class of shares (other than future classes of shares established more than eight years after the date of such termination) which has substantially similar characteristics to the Class 529-B shares or the Class B Shares (all such classes of shares the “Affected Classes of Shares”) of such Affected Funds taking into account the manner of payment and amount of asset based sales charge, CDSC or other similar charges borne directly or indirectly by the holders of such shares; provided that

(a) the Board of Directors/Trustees of such Affected Funds, including the Independent Directors/Trustees (as defined below) of the Affected Funds, shall have determined that such termination is in the best interest of such Affected Funds and the shareholders of such Affected Funds, and

4. Termination of Plan . This Plan may be terminated as to the Fund’s Class 529-B shares at any time by vote of a majority of the Independent [Directors][Trustees], or by vote of a majority of the outstanding Class 529-B shares of the Fund. Unless sooner terminated in accordance with this provision, this Plan shall continue in effect until December 31, 2005. It may thereafter be continued from year to year in the manner provided for in paragraph 2 hereof.

5. Requirements of Agreement . Any Agreement related to this Plan shall be in writing, and shall provide:

a. that such Agreement may be terminated as to the Fund at any time, without payment of any penalty by the vote of a majority of the Independent [Directors][Trustees] or by a vote of a majority of the outstanding Class 529-B shares of the Fund, on not more than sixty (60) days’ written notice to any other party to the Agreement; and

that such Agreement shall terminate automatically in the event of its assignment.

6. Amendment . This Plan may not be amended to increase materially the maximum amount of fees or other distribution expenses provided for in paragraph 1 hereof with respect to the Class 529-B shares of the Fund unless such amendment is approved by vote of a majority of the outstanding voting securities of the Class 529-B shares of the Fund and as provided in paragraph 2 hereof, and no other material amendment to this Plan shall be made unless approved in the manner provided for in paragraph 2 hereof.

IN WITNESS WHEREOF, the Fund has caused this Plan to be executed by its officers thereunto duly authorized, as of [ date ], 2005.

[Name of Fund]

SCHEDULE A

to the

Plan of Distribution of

[Name of Fund]

ALLOCATION SCHEDULE

The following relates solely to Class 529-B shares.

The Distributor's Allocable Portion of Distribution Fees and CDSCs in respect of Class 529-B shares shall be 100% until such time as the Distributor shall cease to serve as exclusive distributor of Class 529-B shares; thereafter, collections that constitute CDSCs and Distribution Fees relating to Class 529-B shares shall be allocated among the Distributor and any successor distributor (" Successor Distributor ") in accordance with this Schedule.

" Commission Share " means each 529-B share issued under circumstances which would normally give rise to an obligation of the holder of such share to pay a CDSC upon redemption of such share (including, without limitation, any 529-B share issued in connection with a permitted free exchange), and any such share shall continue to be a Commission Share of the applicable Fund prior to the redemption (including a redemption in connection with a permitted free exchange) or conversion of such share, even though the obligation to pay the CDSC may have expired or conditions for waivers thereof may exist.

" Date of Original Issuance " means in respect of any Commission Share, the date with reference to which the amount of the CDSC payable on redemption thereof, if any, is computed.

" Free Share " means, in respect of a Fund, each 529-B share of the Fund, other than a Commission Share (including, without limitation, any 529-B share issued in connection with the reinvestment of dividends or capital gains).

" Inception Date " means in respect of a Fund, the first date on which the Fund issued shares.

" Net Asset Value " means the net asset value determined as set forth in the Prospectus of each Fund.

" Omnibus Share " means, in respect of a Fund, a Commission Share or Free Share sold by one of the selling agents maintaining shares in an omnibus account. If, subsequent to the Successor Distributor becoming exclusive distributor of the Class 529-B shares, the Distributor reasonably determines that the transfer agent is able to track all Commission Shares and Free Shares sold by any of the selling agents listed on Exhibit I in the same manner as Commission Shares and Free Shares are currently tracked in respect of selling agents not listed on Exhibit I, then Exhibit I shall be amended to delete such selling agent from Exhibit I so that Commission Shares and Free Shares sold by such selling agent will no longer be treated as Omnibus Shares.

PART I: ATTRIBUTION OF CLASS 529-B SHARES

Class 529-B shares that are outstanding from time to time, shall be attributed to the Distributor and each Successor Distributor in accordance with the following rules;

(1) Commission Shares other than Omnibus Shares :

(a) Commission Shares that are not Omnibus Shares (“Non-Omnibus Commission Shares”) attributed to the Distributor shall be those Non-Omnibus Commission Shares the Date of Original Issuance of which occurred on or after the Inception Date of the applicable Fund and on or prior to the date the Distributor ceased to be exclusive distributor of Class 529-B shares of the Fund.

(b) Non-Omnibus Commission Shares attributable to each Successor Distributor shall be those Non-Omnibus Commission Shares the Date of Original Issuance of which occurs after the date such Successor Distributor became the exclusive distributor of Class 529-B shares of the Fund and on or prior to the date such Successor Distributor ceased to be the exclusive distributor of Class 529-B shares of the Fund.

(c) A Non-Omnibus Commission Share of a Fund issued in consideration of the investment of proceeds of the redemption of a Non-Omnibus Commission Share of another fund (the " Redeeming Fund ") in connection with a permitted free exchange, is deemed to have a Date of Original Issuance identical to the Date of Original Issuance of the Non-Omnibus Commission Share of the Redeeming Fund, and any such Commission Share will be attributed to the Distributor or Successor Distributor based upon such Date of Original Issuance in accordance with rules (a) and (b) above.

(2) Free Shares :

Free Shares that are not Omnibus Shares (“Non-Omnibus Free Shares”) of a Fund outstanding on any date shall be attributed to the Distributor or a Successor Distributor, as the case may be, in the same proportion that the Non-Omnibus Commission Shares of a Fund outstanding on such date are attributed to each on such date; provided that if the Distributor and its transferees reasonably determine that the transfer agent is able to produce monthly reports that track the Date of Original Issuance for such Non-Omnibus Free Shares, then such Free Shares shall be allocated pursuant to clause 1(a), (b) and (c) above.

(3) Omnibus Shares :

PART II: ALLOCATION OF CDSCs

(1) CDSCs Related to the Redemption of Non-Omnibus Commission Shares :

(2) CDSCs Related to the Redemption of Omnibus Shares :

CDSCs in respect of the redemption of Omnibus Shares shall be allocated to the Distributor or a Successor Distributor in the same proportion that CDSCs related to the redemption of Non-Omnibus Commission Shares are allocated to each thereof; provided , that if the Distributor reasonably determines that the transfer agent is able to produce monthly reports which track the Date of Original Issuance for the Omnibus Shares, then the CDSCs in respect of the redemption of Omnibus Shares shall be allocated among the Distributor and any Successor Distributor depending on whether the related redeemed Omnibus Share is attributable to the Distributor or a Successor Distributor, as the case may be, in accordance with Part I above.

PART III: ALLOCATION OF DISTRIBUTION FEE

Assuming that the Distribution Fee remains constant over time so that Part IV hereof does not become operative:

(1) The portion of the aggregate Distribution Fee accrued in respect of all Class 529-B shares of a Fund during any calendar month allocable to the Distributor or a Successor Distributor is determined by multiplying the total of such Distribution Fee by the following fraction:

(A + C)/2

(B + D)/2

where:

A=	The aggregate Net Asset Value of all Class 529-B shares of a Fund attributed to the Distributor or such Successor Distributor, as the case may be, and outstanding at the beginning of such calendar month

B=	The aggregate Net Asset Value of all Class 529-B shares of a Fund at the beginning of such calendar month

C=	The aggregate Net Asset Value of all Class 529-B shares of a Fund attributed to the Distributor or such Successor Distributor, as the case may be, and outstanding at the end of such calendar month

D=	The aggregate Net Asset Value of all Class 529-B shares of a Fund at the end of such calendar month

(2) If the Distributor reasonably determines that the transfer agent is able to produce automated monthly reports that allocate the average Net Asset Value of the Commission Shares (or all Class 529-B shares if available) of a Fund among the Distributor and any Successor Distributor in a manner consistent with the methodology detailed in Part I and Part III(1) above, the portion of the Distribution Fee accrued in respect of all such Class 529-B shares of a Fund during a particular calendar month will be allocated to the Distributor or a Successor Distributor by multiplying the total of such Distribution Fee by the following fraction:

(A)/(B)

where:

A=	Average Net Asset Value of all such Class 529-B shares of a Fund for such calendar month attributed to the Distributor or a Successor Distributor, as the case may be

B=	Total average Net Asset Value of all such Class 529-B shares of a Fund for such calendar month

PART IV: ADJUSTMENT OF THE DISTRIBUTOR’S ALLOCABLE PORTION AND EACH SUCCESSOR DISTRIBUTOR’S ALLOCABLE PORTION

The parties to the Distribution Agreement recognize that, if the terms of any distributor's contract, any distribution plan, any prospectus, the Conduct Rules or any other applicable law change so as to disproportionately reduce, in a manner inconsistent with the intent of this Distribution Agreement, the amount of the Distributor's Allocable Portion or any Successor Distributor's Allocable Portion had no such change occurred, the definitions of the Distributor's Allocable Portion and/or the Successor Distributor's Allocable Portion in respect of the Class 529-B shares relating to a Fund shall be adjusted by agreement among the relevant parties; provided , however , if the Distributor, the Successor Distributor and the Fund cannot agree within thirty (30) days after the date of any such change in applicable laws or in any distributor's contract, distribution plan, prospectus or the Conduct Rules, they shall submit the question to arbitration in accordance with the commercial arbitration rules of the American Arbitration Association and the decision reached by the arbitrator shall be final and binding on each of them.

AMENDED AND RESTATED

PLAN OF DISTRIBUTION

[Name of Fund]

relating to its

CLASS 529-C SHARES

WHEREAS, [Name of Fund] (the “Fund”) is a [Maryland corporation][Massachusetts business trust] that offers various classes of shares of [common stock][beneficial interest]; and

WHEREAS, the purpose of this Plan of Distribution (the “Plan”) is to authorize the Fund to bear expenses of distribution of its Class 529-C shares; and

WHEREAS, the Board of [Directors][Trustees] of the Fund has determined that there is a reasonable likelihood that this Plan will benefit the Fund and its shareholders;

NOW, THEREFORE, the Fund adopts this Plan as follows:

Service Fees. The Fund shall pay to the Distributor no more frequently than monthly in arrears a service fee (the “Service Fee”), which shall accrue daily in an amount equal to the daily equivalent of 0.25% per annum of the net asset value of the Fund’s Class 529-C shares outstanding on each day. The Service Fee compensates the Distributor for paying service-related expenses, including Service Fees to others in respect of Class 529-C shares of the Fund.

Distribution Fees. The Fund shall pay to the Distributor no more frequently than monthly in arrears its “Allocable Portion” as described in Schedule A to this Plan (“Allocation Schedule”), and until such time as the Fund designates a successor to AFD as distributor, the Allocable Portion shall equal 100% of a fee (the “Distribution Fee”), which shall accrue daily in an amount equal to the daily equivalent of 0.75% per annum of the net asset value of the Fund’s Class 529-C shares outstanding on each day. The Distribution Fee compensates the Distributor for providing distribution and sales-related services in respect of Class 529-C shares of the Fund.

Any Agreement between the Fund and the Distributor relating to the Fund’s Class 529C shares shall provide that:

(i)

(ii)

notwithstanding anything to the contrary in this Plan or the Agreement, the Fund’s obligation to pay the Distributor its Allocable Portion of the Distribution Fee shall not be terminated or modified (including without limitation, by change in the rules applicable to the conversion of the Class 529-C shares into shares of another class) for any reason (including a termination of this Plan or the Agreement between such Distributor and the Fund) except:

(a)

(b)

(c)

in connection with a Complete Termination (as defined below) of this Plan by the Fund;

(iii) the Fund will not take any action to waive or change any contingent deferred sales charge (“CDSC”) in respect of the Class 529-C shares, the Date of Original Issuance of which occurs on or prior to the taking of such action except as provided in the Fund’s prospectus or statement of additional information on the date such Commission Share was issued, without the consent of the Distributor or its assigns;

(iv) notwithstanding anything to the contrary in this Plan or the Agreement, none of the termination of the Distributor’s role as principal underwriter of the Class 529-C shares of the Fund, the termination of the Agreement or the termination of this Plan will terminate the Distributor’s right to its Allocable Portion of the CDSCs in respect of Class 529-C shares of the Fund;

(v) except as provided in (ii) above and notwithstanding anything to the contrary in this Plan or the Agreement, the Fund’s obligation to pay the Distributor’s Allocable Portion of the Distribution Fees and CDSCs payable in respect of the Class 529-C shares of the Fund shall be absolute and unconditional and shall not be subject to dispute, offset, counterclaim or any defense whatsoever, at law or equity, including, without limitation, any of the foregoing based on the insolvency or bankruptcy of the Distributor; and

(vi)

until the Distributor has been paid its Allocable Portion of the Distribution Fees in respect of the Class 529-C shares of the Fund, the Fund will not adopt a plan of liquidation in respect of the Class 529-C shares without the consent of the Distributor and its assigns. For purposes of this Plan, the term Allocable Portion of the Distribution Fees or CDSCs payable in respect of the Class 529-C shares as applied to any Distributor shall mean the portion of such Distribution Fees or CDSCs payable in respect of such Class 529-C shares of the Fund allocated to the Distributor in accordance with the Allocation Schedule as it relates to the Class 529-C shares of the Fund, and until such time as the Fund designates a successor to AFD as distributor, the Allocable Portion shall equal 100% of the Distribution Fees and CDSCs. For purposes of this Plan, the term “Complete Termination” in respect of this Plan as it relates to the Class 529-C shares means a termination of this Plan involving the complete cessation of the payment of Distribution Fees in respect of all Class 529-C shares, the termination of the distribution plans and principal underwriting agreements, and the complete cessation of the payment of any asset based sales charge (within the meaning of the Conduct Rules of the NASD) or similar fees in respect of the Fund and any successor mutual fund or any mutual fund acquiring a substantial portion of the assets of the Fund (the Fund and such other mutual funds hereinafter referred to as the “Affected Funds”) and in respect of the Class 529-C shares and every future class of shares (other than future classes of shares established more than one year after the date of such termination) which has substantially similar characteristics to the Class 529-C shares (all such classes of shares the “Affected Classes of Shares”) of such Affected Funds taking into account the manner of payment and amount of asset based sales charge, CDSC or other similar charges borne directly or indirectly by the holders of such shares; provided that

4. Termination of Plan . This Plan may be terminated as to the Fund’s Class 529-C shares at any time by vote of a majority of the Independent [Directors][Trustees], or by vote of a majority of the outstanding Class 529-C shares of the Fund. Unless sooner terminated in accordance with this provision, this Plan shall continue in effect until December 31, 2005. It may thereafter be continued from year to year in the manner provided for in paragraph 2 hereof.

5. Requirements of Agreement . Any Agreement related to this Plan shall be in writing, and shall provide:

a. that such Agreement may be terminated as to the Fund at any time, without payment of any penalty by the vote of a majority of the Independent [Directors][Trustees] or by a vote of a majority of the outstanding Class 529-C shares of the Fund, on not more than sixty (60) days’ written notice to any other party to the Agreement; and

that such Agreement shall terminate automatically in the event of its assignment.

6. Amendment . This Plan may not be amended to increase materially the maximum amount of fees or other distribution expenses provided for in paragraph 1 hereof with respect to the Class 529-C shares of the Fund unless such amendment is approved by vote of a majority of the outstanding voting securities of the Class 529-C shares of the Fund and as provided in paragraph 2 hereof, and no other material amendment to this Plan shall be made unless approved in the manner provided for in paragraph 2 hereof.

IN WITNESS WHEREOF, the Fund has caused this Plan to be executed by its officers thereunto duly authorized, as of [date], 2005.

[Name of Fund]

FORM OF

SCHEDULE A

to the

Plan of Distribution of

[Name of Fund]

ALLOCATION SCHEDULE

The following relates solely to Class 529-C shares.

The Distributor's Allocable Portion of Distribution Fees and CDSCs in respect of Class 529-C shares shall be 100% until such time as the Distributor shall cease to serve as exclusive distributor of Class 529-C shares; thereafter, collections that constitute CDSCs and Distribution Fees relating to Class 529-C shares shall be allocated among the Distributor and any successor distributor (" Successor Distributor ") in accordance with this Schedule.

" Commission Share " means each 529C share issued under circumstances which would normally give rise to an obligation of the holder of such share to pay a CDSC upon redemption of such share (including, without limitation, any 529C share issued in connection with a permitted free exchange), and any such share shall continue to be a Commission Share of the applicable Fund prior to the redemption (including a redemption in connection with a permitted free exchange) or conversion of such share, even though the obligation to pay the CDSC may have expired or conditions for waivers thereof may exist.

" Date of Original Issuance " means in respect of any Commission Share, the date with reference to which the amount of the CDSC payable on redemption thereof, if any, is computed.

" Free Share " means, in respect of a Fund, each 529C share of the Fund, other than a Commission Share (including, without limitation, any 529C share issued in connection with the reinvestment of dividends or capital gains).

" Inception Date " means in respect of a Fund, the first date on which the Fund issued shares.

" Net Asset Value " means the net asset value determined as set forth in the Prospectus of each Fund.

" Omnibus Share " means, in respect of a Fund, a Commission Share or Free Share sold by one of the selling agents maintaining shares in an omnibus account. If, subsequent to the Successor Distributor becoming exclusive distributor of the Class 529-C shares, the Distributor reasonably determines that the transfer agent is able to track all Commission Shares and Free Shares sold by any of the selling agents listed on Exhibit I in the same manner as Commission Shares and Free Shares are currently tracked in respect of selling agents not listed on Exhibit I, then Exhibit I shall be amended to delete such selling agent from Exhibit I so that Commission Shares and Free Shares sold by such selling agent will no longer be treated as Omnibus Shares.

PART I: ATTRIBUTION OF Class 529-C SHARES

Class 529-C shares that are outstanding from time to time, shall be attributed to the Distributor and each Successor Distributor in accordance with the following rules;

(1) Commission Shares other than Omnibus Shares :

(b) Non-Omnibus Commission Shares attributable to each Successor Distributor shall be those Non-Omnibus Commission Shares the Date of Original Issuance of which occurs after the date such Successor Distributor became the exclusive distributor of Class 529-C shares of the Fund and on or prior to the date such Successor Distributor ceased to be the exclusive distributor of Class 529-C shares of the Fund.

(2) Free Shares :

Free Shares that are not Omnibus Shares (“Non-Omnibus Free Shares”) of a Fund outstanding on any date shall be attributed to the Distributor or a Successor Distributor, as the case may be, in the same proportion that the Non-Omnibus Commission Shares of a Fund outstanding on such date are attributed to each on such date; provided that if the Distributor and its transferees reasonably determine that the transfer agent is able to produce monthly reports that track the Date of Original Issuance for such Non-Omnibus Free Shares, then such Free Shares shall be allocated pursuant to clause 1(a), (b) and (c) above.

(3) Omnibus Shares :

PART II: ALLOCATION OF CDSCs

(1) CDSCs Related to the Redemption of Non-Omnibus Commission Shares :

(2) CDSCs Related to the Redemption of Omnibus Shares :

CDSCs in respect of the redemption of Omnibus Shares shall be allocated to the Distributor or a Successor Distributor in the same proportion that CDSCs related to the redemption of Non-Omnibus Commission Shares are allocated to each thereof; provided , that if the Distributor reasonably determines that the transfer agent is able to produce monthly reports which track the Date of Original Issuance for the Omnibus Shares, then the CDSCs in respect of the redemption of Omnibus Shares shall be allocated among the Distributor and any Successor Distributor depending on whether the related redeemed Omnibus Share is attributable to the Distributor or a Successor Distributor, as the case may be, in accordance with Part I above.

PART III: ALLOCATION OF DISTRIBUTION FEE

Assuming that the Distribution Fee remains constant over time so that Part IV hereof does not become operative:

(1) The portion of the aggregate Distribution Fee accrued in respect of all Class 529-C shares of a Fund during any calendar month allocable to the Distributor or a Successor Distributor is determined by multiplying the total of such Distribution Fee by the following fraction:

(A + C)/2

(B + D)/2

where:

A=	The aggregate Net Asset Value of all Class 529-C shares of a Fund attributed to the Distributor or such Successor Distributor, as the case may be, and outstanding at the beginning of such calendar month

B=	The aggregate Net Asset Value of all Class 529-C shares of a Fund at the beginning of such calendar month

C=	The aggregate Net Asset Value of all Class 529-C shares of a Fund attributed to the Distributor or such Successor Distributor, as the case may be, and outstanding at the end of such calendar month

D=	The aggregate Net Asset Value of all Class 529-C shares of a Fund at the end of such calendar month

(2) If the Distributor reasonably determines that the transfer agent is able to produce automated monthly reports that allocate the average Net Asset Value of the Commission Shares (or all Class 529-C shares if available) of a Fund among the Distributor and any Successor Distributor in a manner consistent with the methodology detailed in Part I and Part III(1) above, the portion of the Distribution Fee accrued in respect of all such Class 529-C shares of a Fund during a particular calendar month will be allocated to the Distributor or a Successor Distributor by multiplying the total of such Distribution Fee by the following fraction:

(A)/(B)

where:

A=	Average Net Asset Value of all such Class 529-C shares of a Fund for such calendar month attributed to the Distributor or a Successor Distributor, as the case may be

B=	Total average Net Asset Value of all such Class 529-C shares of a Fund for such calendar month

PART IV: ADJUSTMENT OF THE DISTRIBUTOR’S ALLOCABLE PORTION AND EACH SUCCESSOR DISTRIBUTOR’S ALLOCABLE PORTION

The parties to the Distribution Agreement recognize that, if the terms of any distributor's contract, any distribution plan, any prospectus, the Conduct Rules or any other applicable law change so as to disproportionately reduce, in a manner inconsistent with the intent of this Distribution Agreement, the amount of the Distributor's Allocable Portion or any Successor Distributor's Allocable Portion had no such change occurred, the definitions of the Distributor's Allocable Portion and/or the Successor Distributor's Allocable Portion in respect of the Class 529-C shares relating to a Fund shall be adjusted by agreement among the relevant parties; provided , however , if the Distributor, the Successor Distributor and the Fund cannot agree within thirty (30) days after the date of any such change in applicable laws or in any distributor's contract, distribution plan, prospectus or the Conduct Rules, they shall submit the question to arbitration in accordance with the commercial arbitration rules of the American Arbitration Association and the decision reached by the arbitrator shall be final and binding on each of them.

Form of

AMENDED AND RESTATED

PLAN OF DISTRIBUTION

[Name of Fund]

relating to its

CLASS 529-E SHARES

WHEREAS, [Name of Fund] (the “Fund”) is a [Maryland corporation][Massachusetts business trust] that offers various classes of shares of [common stock][beneficial interest]; and

WHEREAS, the purpose of this Plan of Distribution (the “Plan”) is to authorize the Fund to bear expenses of distribution of its Class 529-E shares; and

WHEREAS, the Board of [Directors][Trustees] of the Fund has determined that there is a reasonable likelihood that this Plan will benefit the Fund and its shareholders;

NOW, THEREFORE, the Fund adopts this Plan as follows:

1. Payments to Distributor . The Fund may expend pursuant to this Plan and as set forth below an aggregate amount not to exceed 0.75% per annum of the average net assets of the Fund’s Class 529-E shares.

The categories of expenses permitted under this Plan include service fees (“Service Fees”) in an amount not to exceed 0.25%, and distribution fees (“Distribution Fees”) in an amount not to exceed 0.50%, each such percentage being per annum of the average net assets of the Fund’s Class 529-E shares. The actual amounts paid shall be determined by the Board of [Directors][Trustees]. The Service Fee compensates the Distributor for service-related expenses, including paying Service Fees to others in respect of Class 529-E shares of the Fund. The Distribution Fee compensates the Distributor for providing distribution services in respect of Class 529-E shares of the Fund.

2. Approval by the Board . This Plan shall not take effect until it has been approved, together with any related agreement, by votes of the majority of both (i) the Board of [Directors][Trustees] of the Fund and (ii) those [Directors][Trustees] of the Fund who are not “interested persons” of the Fund (as defined in the Investment Company Act of 1940) and have no direct or indirect financial interest in the operation of this Plan or any agreement related to it (the “Independent [Directors][Trustees]”), cast in person at a meeting called for the purpose of voting on this Plan and/or such agreement.

4. Termination of Plan . This Plan may be terminated as to the Fund’s Class 529-E shares at any time by vote of a majority of the Independent [Directors][Trustees], or by vote of a majority of the outstanding Class 529-E shares of the Fund. Unless sooner terminated in accordance with this provision, this Plan shall continue in effect until December 31, 2005. It may thereafter be continued from year to year in the manner provided for in paragraph 2 hereof.

5. Requirements of Agreement . Any Agreement related to this Plan shall be in writing, and shall provide:

a. that such Agreement may be terminated as to the Fund at any time, without payment of any penalty by the vote of a majority of the Independent [Directors][Trustees] or by a vote of a majority of the outstanding Class 529-E shares of the Fund, on not more than sixty (60) days’ written notice to any other party to the Agreement; and

b. that such Agreement shall terminate automatically in the event of its assignment.

6. Amendment . This Plan may not be amended to increase materially the maximum amount of fees or other distribution expenses provided for in paragraph 1 hereof with respect to the Class 529-E shares of the Fund unless such amendment is approved by vote of a majority of the outstanding voting securities of the Class 529-E shares of the Fund and as provided in paragraph 2 hereof, and no other material amendment to this Plan shall be made unless approved in the manner provided for in paragraph 2 hereof.

IN WITNESS WHEREOF, the Fund has caused this Plan to be executed by its officers thereunto duly authorized, as of [ date ], 2005.

[Name of Fund]

Form of

AMENDED AND RESTATED

PLAN OF DISTRIBUTION

[Name of Fund]

relating to its

CLASS 529-F SHARES

WHEREAS, [Name of Fund] (the “Fund”) is a [Maryland corporation][Massachusetts business trust] that offers various classes of shares of [common stock][beneficial interest]; and

WHEREAS, the purpose of this Plan of Distribution (the “Plan”) is to authorize the Fund to bear expenses of distribution of its Class 529-F shares; and

WHEREAS, the Board of [Directors][Trustees] of the Fund has determined that there is a reasonable likelihood that this Plan will benefit the Fund and its shareholders;

NOW, THEREFORE, the Fund adopts this Plan as follows:

The categories of expenses permitted under this Plan include service fees (“Service Fees”) in an amount not to exceed 0.25%, and distribution fees (“Distribution Fees”) in an amount not to exceed 0.25%, each such percentage being per annum of the average net assets of the Fund’s Class 529-F shares. The actual amounts paid shall be determined by the Board of [Directors][Trustees]. The Service Fee compensates the Distributor for service-related expenses, including paying Service Fees to others in respect of Class 529-F shares of the Fund. The Distribution Fee compensates the Distributor for providing distribution services in respect of Class 529-F shares of the Fund.

2. Approval by the Board . This Plan shall not take effect until it has been approved, together with any related agreement, by votes of the majority of both (i) the Board of [Directors][Trustees] of the Fund and (ii) those [Directors][Trustees] of the Fund who are not “interested persons” of the Fund (as defined in the Investment Company Act of 1940) and have no direct or indirect financial interest in the operation of this Plan or any agreement related to it (the “Independent [Directors][Trustees]”), cast in person at a meeting called for the purpose of voting on this Plan and/or such agreement.

4. Termination of Plan . This Plan may be terminated as to the Fund’s Class 529-F shares at any time by vote of a majority of the Independent [Directors][Trustees], or by vote of a majority of the outstanding Class 529-F shares of the Fund. Unless sooner terminated in accordance with this provision, this Plan shall continue in effect until December 31, 2005. It may thereafter be continued from year to year in the manner provided for in paragraph 2 hereof.

5. Requirements of Agreement . Any Agreement related to this Plan shall be in writing, and shall provide:

a. that such Agreement may be terminated as to the Fund at any time, without payment of any penalty by the vote of a majority of the Independent [Directors][Trustees] or by a vote of a majority of the outstanding Class 529-F shares of the Fund, on not more than sixty (60) days’ written notice to any other party to the Agreement; and

b. that such Agreement shall terminate automatically in the event of its assignment.

6. Amendment . This Plan may not be amended to increase materially the maximum amount of fees or other distribution expenses provided for in paragraph 1 hereof with respect to the Class 529-F shares of the Fund unless such amendment is approved by vote of a majority of the outstanding voting securities of the Class 529-F shares of the Fund and as provided in paragraph 2 hereof, and no other material amendment to this Plan shall be made unless approved in the manner provided for in paragraph 2 hereof.

IN WITNESS WHEREOF, the Fund has caused this Plan to be executed by its officers thereunto duly authorized, as of [ date ], 2005.

[Name of Fund]

Form of

AMENDED AND RESTATED

PLAN OF DISTRIBUTION

[Name of Fund]

relating to its

CLASS R-1 SHARES

WHEREAS, [Name of Fund] (the “Fund”) is a [Maryland corporation][Massachusetts business trust] that offers various classes of shares of [common stock][beneficial interest]; and

WHEREAS, the purpose of this Plan of Distribution (the “Plan”) is to authorize the Fund to bear expenses of distribution of its Class R-1 shares; and

WHEREAS, the Board of [Directors][Trustees] of the Fund has determined that there is a reasonable likelihood that this Plan will benefit the Fund and its shareholders;

NOW, THEREFORE, the Fund adopts this Plan as follows:

The categories of expenses permitted under this Plan include service fees (“Service Fees”) in an amount not to exceed 0.25%, and distribution fees (“Distribution Fees”) in an amount not to exceed 0.75%, each such percentage being per annum of the average net assets of the Fund’s Class R-1 shares. The actual amounts paid shall be determined by the Board of [Directors][Trustees]. The Service Fee compensates the Distributor for service-related expenses, including paying Service Fees to others in respect of Class R-1 shares of the Fund. The Distribution Fee compensates the Distributor for providing distribution services in respect of Class R-1 shares of the Fund.

2. Approval by the Board . This Plan shall not take effect until it has been approved, together with any related agreement, by votes of the majority of both (i) the Board of [Directors][Trustees] of the Fund and (ii) those [Directors][Trustees] of the Fund who are not “interested persons” of the Fund (as defined in the Investment Company Act of 1940) and have no direct or indirect financial interest in the operation of this Plan or any agreement related to it (the “Independent [Directors][Trustees]”), cast in person at a meeting called for the purpose of voting on this Plan and/or such agreement.

4. Termination of Plan . This Plan may be terminated as to the Fund’s Class R-1 shares at any time by vote of a majority of the Independent [Directors][Trustees], or by vote of a majority of the outstanding Class R-1 shares of the Fund. Unless sooner terminated in accordance with this provision, this Plan shall continue in effect until December 31, 2005. It may thereafter be continued from year to year in the manner provided for in paragraph 2 hereof.

5. Requirements of Agreement . Any Agreement related to this Plan shall be in writing, and shall provide:

a. that such Agreement may be terminated as to the Fund at any time, without payment of any penalty by the vote of a majority of the Independent [Directors][Trustees] or by a vote of a majority of the outstanding Class R-1 shares of the Fund, on not more than sixty (60) days’ written notice to any other party to the Agreement; and

b. that such Agreement shall terminate automatically in the event of its assignment.

6. Amendment . This Plan may not be amended to increase materially the maximum amount of fees or other distribution expenses provided for in paragraph 1 hereof with respect to the Class R-1 shares of the Fund unless such amendment is approved by vote of a majority of the outstanding voting securities of the Class R-1 shares of the Fund and as provided in paragraph 2 hereof, and no other material amendment to this Plan shall be made unless approved in the manner provided for in paragraph 2 hereof.

IN WITNESS WHEREOF, the Fund has caused this Plan to be executed by its officers thereunto duly authorized, as of [ date ], 2005.

[Name of Fund]

Form of

AMENDED AND RESTATED

PLAN OF DISTRIBUTION

[Name of Fund]

relating to its

CLASS R-2 SHARES

WHEREAS, [Name of Fund] (the “Fund”) is a [Maryland corporation][Massachusetts business trust] that offers various classes of shares of [common stock][beneficial interest]; and

WHEREAS, the purpose of this Plan of Distribution (the “Plan”) is to authorize the Fund to bear expenses of distribution of its Class R-2 shares; and

WHEREAS, the Board of [Directors][Trustees] of the Fund has determined that there is a reasonable likelihood that this Plan will benefit the Fund and its shareholders;

NOW, THEREFORE, the Fund adopts this Plan as follows:

The categories of expenses permitted under this Plan include service fees (“Service Fees”) in an amount not to exceed 0.25%, and distribution fees (“Distribution Fees”) in an amount not to exceed 0.75%, each such percentage being per annum of the average net assets of the Fund’s Class R-2 shares. The actual amounts paid shall be determined by the Board of [Directors][Trustees]. The Service Fee compensates the Distributor for service-related expenses, including paying Service Fees to others in respect of Class R-2 shares of the Fund. The Distribution Fee compensates the Distributor for providing distribution services in respect of Class R-2 shares of the Fund.

2. Approval by the Board . This Plan shall not take effect until it has been approved, together with any related agreement, by votes of the majority of both (i) the Board of [Directors][Trustees] of the Fund and (ii) those [Directors][Trustees] of the Fund who are not “interested persons” of the Fund (as defined in the Investment Company Act of 1940) and have no direct or indirect financial interest in the operation of this Plan or any agreement related to it (the “Independent [Directors][Trustees]”), cast in person at a meeting called for the purpose of voting on this Plan and/or such agreement.

4. Termination of Plan . This Plan may be terminated as to the Fund’s Class R-2 shares at any time by vote of a majority of the Independent [Directors][Trustees], or by vote of a majority of the outstanding Class R-2 shares of the Fund. Unless sooner terminated in accordance with this provision, this Plan shall continue in effect until December 31, 2005. It may thereafter be continued from year to year in the manner provided for in paragraph 2 hereof.

5. Requirements of Agreement . Any Agreement related to this Plan shall be in writing, and shall provide:

a. that such Agreement may be terminated as to the Fund at any time, without payment of any penalty by the vote of a majority of the Independent [Directors][Trustees] or by a vote of a majority of the outstanding Class R-2 shares of the Fund, on not more than sixty (60) days’ written notice to any other party to the Agreement; and

b. that such Agreement shall terminate automatically in the event of its assignment.

6. Amendment . This Plan may not be amended to increase materially the maximum amount of fees or other distribution expenses provided for in paragraph 1 hereof with respect to the Class R-2 shares of the Fund unless such amendment is approved by vote of a majority of the outstanding voting securities of the Class R-2 shares of the Fund and as provided in paragraph 2 hereof, and no other material amendment to this Plan shall be made unless approved in the manner provided for in paragraph 2 hereof.

IN WITNESS WHEREOF, the Fund has caused this Plan to be executed by its officers thereunto duly authorized, as of October 1, 2005.

[Name of Fund]

Form of

AMENDED AND RESTATED

PLAN OF DISTRIBUTION

[Name of Fund]

relating to its

CLASS R-3 SHARES

WHEREAS, [Name of Fund] (the “Fund”) is a [Maryland corporation][Massachusetts business trust] that offers various classes of shares of [common stock][beneficial interest]; and

WHEREAS, the purpose of this Plan of Distribution (the “Plan”) is to authorize the Fund to bear expenses of distribution of its Class R-3 shares; and

WHEREAS, the Board of [Directors][Trustees] of the Fund has determined that there is a reasonable likelihood that this Plan will benefit the Fund and its shareholders;

NOW, THEREFORE, the Fund adopts this Plan as follows:

The categories of expenses permitted under this Plan include service fees (“Service Fees”) in an amount not to exceed 0.25%, and distribution fees (“Distribution Fees”) in an amount not to exceed 0.50%, each such percentage being per annum of the average net assets of the Fund’s Class R-3 shares. The actual amounts paid shall be determined by the Board of [Directors][Trustees]. The Service Fee compensates the Distributor for service-related expenses, including paying Service Fees to others in respect of Class R-3 shares of the Fund. The Distribution Fee compensates the Distributor for providing distribution services in respect of Class R-3 shares of the Fund.

2. Approval by the Board . This Plan shall not take effect until it has been approved, together with any related agreement, by votes of the majority of both (i) the Board of [Directors][Trustees] of the Fund and (ii) those [Directors][Trustees] of the Fund who are not “interested persons” of the Fund (as defined in the Investment Company Act of 1940) and have no direct or indirect financial interest in the operation of this Plan or any agreement related to it (the “Independent [Directors][Trustees]”), cast in person at a meeting called for the purpose of voting on this Plan and/or such agreement.

4. Termination of Plan . This Plan may be terminated as to the Fund’s Class R-3 shares at any time by vote of a majority of the Independent [Directors][Trustees], or by vote of a majority of the outstanding Class R-3 shares of the Fund. Unless sooner terminated in accordance with this provision, this Plan shall continue in effect until December 31, 2005. It may thereafter be continued from year to year in the manner provided for in paragraph 2 hereof.

5. Requirements of Agreement . Any Agreement related to this Plan shall be in writing, and shall provide:

a. that such Agreement may be terminated as to the Fund at any time, without payment of any penalty by the vote of a majority of the Independent [Directors][Trustees] or by a vote of a majority of the outstanding Class R-3 shares of the Fund, on not more than sixty (60) days’ written notice to any other party to the Agreement; and

b. that such Agreement shall terminate automatically in the event of its assignment.

6. Amendment . This Plan may not be amended to increase materially the maximum amount of fees or other distribution expenses provided for in paragraph 1 hereof with respect to the Class R-3 shares of the Fund unless such amendment is approved by vote of a majority of the outstanding voting securities of the Class R-3 shares of the Fund and as provided in paragraph 2 hereof, and no other material amendment to this Plan shall be made unless approved in the manner provided for in paragraph 2 hereof.

IN WITNESS WHEREOF, the Fund has caused this Plan to be executed by its officers thereunto duly authorized, as of [ date ], 2005.

[Name of Fund]

Form of

AMENDED AND RESTATED

PLAN OF DISTRIBUTION

[Name of Fund]

relating to its

CLASS R-4 SHARES

WHEREAS, [Name of Fund] (the “Fund”) is a [Maryland corporation][Massachusetts business trust] that offers various classes of shares of [common stock][beneficial interest]; and

WHEREAS, the purpose of this Plan of Distribution (the “Plan”) is to authorize the Fund to bear expenses of distribution of its Class R-4 shares; and

WHEREAS, the Board of [Directors][Trustees] of the Fund has determined that there is a reasonable likelihood that this Plan will benefit the Fund and its shareholders;

NOW, THEREFORE, the Fund adopts this Plan as follows:

The categories of expenses permitted under this Plan include service fees (“Service Fees”) in an amount not to exceed 0.25%, and distribution fees (“Distribution Fees”) in an amount not to exceed 0.25%, each such percentage being per annum of the average net assets of the Fund’s Class R-4 shares. The actual amounts paid shall be determined by the Board of [Directors][Trustees]. The Service Fee compensates the Distributor for service-related expenses, including paying Service Fees to others in respect of Class R-4 shares of the Fund. The Distribution Fee compensates the Distributor for providing distribution services in respect of Class R-4 shares of the Fund.

2. Approval by the Board . This Plan shall not take effect until it has been approved, together with any related agreement, by votes of the majority of both (i) the Board of [Directors][Trustees] of the Fund and (ii) those [Directors][Trustees] of the Fund who are not “interested persons” of the Fund (as defined in the Investment Company Act of 1940) and have no direct or indirect financial interest in the operation of this Plan or any agreement related to it (the “Independent [Directors][Trustees]”), cast in person at a meeting called for the purpose of voting on this Plan and/or such agreement.

4. Termination of Plan . This Plan may be terminated as to the Fund’s Class R-4 shares at any time by vote of a majority of the Independent [Directors][Trustees], or by vote of a majority of the outstanding Class R-4 shares of the Fund. Unless sooner terminated in accordance with this provision, this Plan shall continue in effect until December 31, 2005. It may thereafter be continued from year to year in the manner provided for in paragraph 2 hereof.

5. Requirements of Agreement . Any Agreement related to this Plan shall be in writing, and shall provide:

a. that such Agreement may be terminated as to the Fund at any time, without payment of any penalty by the vote of a majority of the Independent [Directors][Trustees] or by a vote of a majority of the outstanding Class R-4 shares of the Fund, on not more than sixty (60) days’ written notice to any other party to the Agreement; and

b. that such Agreement shall terminate automatically in the event of its assignment.

6. Amendment . This Plan may not be amended to increase materially the maximum amount of fees or other distribution expenses provided for in paragraph 1 hereof with respect to the Class R-4 shares of the Fund unless such amendment is approved by vote of a majority of the outstanding voting securities of the Class R-4 shares of the Fund and as provided in paragraph 2 hereof, and no other material amendment to this Plan shall be made unless approved in the manner provided for in paragraph 2 hereof.

IN WITNESS WHEREOF, the Fund has caused this Plan to be executed by its officers thereunto duly authorized, as of [ date ], 2005.

[Name of Fund]

[logo - American Funds (r)]

The following is representative of the Code of Ethics in effect for each Fund:

CODE OF ETHICS

With respect to non-affiliated Board members and all other access persons to the extent that they are not covered by The Capital Group Companies, Inc. policies:

●

No Board member shall so use his or her position or knowledge gained therefrom as to create a conflict between his or her personal interest and that of the Fund.

●

No Board member shall engage in excessive trading of shares of the fund or any other affiliated fund to take advantage of short-term market movements.

●

Each non-affiliated Board member shall report to the Secretary of the Fund not later than thirty (30) days after the end of each calendar quarter any transaction in securities which such Board member has effected during the quarter which the Board member then knows to have been effected within fifteen (15) days before or after a date on which the Fund purchased or sold, or considered the purchase or sale of, the same security.

●

For purposes of this Code of Ethics, transactions involving United States Government securities as defined in the Investment Company Act of 1940, bankers’ acceptances, bank certificates of deposit, commercial paper, or shares of registered open-end investment companies are exempt from reporting as are non-volitional transactions such as dividend reinvestment programs and transactions over which the Board member exercises no control.

* * * *

In addition, the Fund has adopted the following standards in accordance with the requirements of Form N-CSR adopted by the Securities and Exchange Commission pursuant to Section 406 of the Sarbanes-Oxley Act of 2002 for the purpose of deterring wrongdoing and promoting: 1) honest and ethical conduct, including handling of actual or apparent conflicts of interest between personal and professional relationships; 2) full, fair, accurate, timely and understandable disclosure in reports and documents that a fund files with or submits to the Commission and in other public communications made by the fund; 3) compliance with applicable governmental laws, rules and regulations; 4) the prompt internal reporting of violations of the Code to an appropriate person or persons identified in the Code; and 5) accountability for adherence to the Code. These provisions shall apply to the principal executive officer or chief executive officer and treasurer (“Covered Officers”) of the Fund.

1. It is the responsibility of Covered Officers to foster, by their words and actions, a corporate culture that encourages honest and ethical conduct, including the ethical resolution of, and appropriate disclosure of conflicts of interest. Covered Officers should work to assure a working environment that is characterized by respect for law and compliance with applicable rules and regulations.

Each Covered Officer must act in an honest and ethical manner while conducting the affairs of the Fund, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships. Duties of Covered Officers include:

Acting with integrity;

Adhering to a high standard of business ethics;

Not using personal influence or personal relationships to improperly influence investment decisions or financial reporting whereby the Covered Officer would benefit personally to the detriment of the Fund;

Each Covered Officer should act to promote full, fair, accurate, timely and understandable disclosure in reports and documents that the Fund files with or submits to, the Securities and Exchange Commission and in other public communications made by the Fund. Each Covered Officer should act to promote full, fair, accurate, timely and understandable disclosure in reports and documents that the Fund files with or submits to, the Securities and Exchange Commission and in other public communications made by the Fund.

Covered Officers should familiarize themselves with disclosure requirements applicable to the Fund and disclosure controls and procedures in place to meet these requirements.

Covered Officers must not knowingly misrepresent, or cause others to misrepresent facts about the Fund to others, including the Fund’s auditors, independent directors, governmental regulators and self-regulatory organizations.

Any existing or potential violations of this Code should be reported to The Capital Group Companies’ Personal Investing Committee. The Personal Investing Committee is authorized to investigate any such violations and report their findings to the Chairman of the Audit Committee of the Fund. The Chairman of the Audit Committee may report violations of the Code to the Fund’s Board or other appropriate entity including the Audit Committee, if he or she believes such a reporting is appropriate. The Personal Investing Committee may also determine the appropriate sanction for any violations of this Code, including removal from office, provided that removal from office shall only be carried out with the approval of the Fund’s Board.

Application of this Code is the responsibility of the Personal Investing Committee, which shall report periodically to the Chairman of the Audit Committee of the Fund.

Material amendments to these provisions must be ratified by a majority vote of the Fund’s Board. As required by applicable rules, substantive amendments to the Code must be filed or appropriately disclosed.

Following is the Code of Ethics for The Capital Group Companies Inc. (Capital), which includes Capital Research and Management Company, the investment adviser to the American Funds and those involved in the distribution of the funds, client support and services; and Capital Group International Inc. (CGII), which includes Capital Guardian Trust Company and Capital International Inc. The Code of Ethics applies to all associates.

The Capital Group Companies

CODE OF ETHICS

All of us within the Capital organization are responsible for maintaining the very highest ethical standards when conducting business. In keeping with these standards, we must always place the interests of clients and fund shareholders ahead of our own. Moreover, we should adhere to the spirit as well as the letter of the law and be vigilant in guarding against anything that could color our judgment.

Over the years we have earned a reputation for the highest integrity. Regardless of lesser standards that may be followed through business or community custom, we must observe exemplary standards of openness, integrity, honesty and trust. Accordingly, we have adopted certain standards as described below for the purpose of deterring wrongdoing and promoting: 1) honest and ethical conduct; 2) full, fair, accurate, timely and understandable disclosure in reports and documents; 3) compliance with applicable laws (including federal securities laws), rules, and regulations; 4) the prompt internal reporting of violations of our Code of Ethics; and 5) accountability for adherence to our Code of Ethics.

General Guidelines

Although specific policies are discussed in more detail below, these are general guidelines that all Capital associates should be aware of:

It is a crime in the U.S. and many other countries to transact in a company’s securities while in possession of material non-public information about the company. If there is any question as to whether you’ve received material information (typically from a company “insider”) you should contact any member of the legal staff to discuss.

·	You should not knowingly misrepresent, or cause others to misrepresent, facts about Capital to clients, fund shareholders, regulators, or any other member of the public. Disclosure in reports and documents should be fair and accurate.

·	You should not accept extravagant gifts or entertainment from persons or companies who are trying to solicit business from any of the Capital companies. Capital’s Gifts and Entertainment Policy is summarized below.

Safeguarding non-public information - - All associates are responsible for safeguarding non-public information about securities recommendations and fund and client holdings (for example, analyst research reports, investment meeting discussions or notes, current fund/client transaction information). If you have access to such information, you will likely be subject to additional personal investing limitations under Capital’s Personal Investing Policy 1 . Even if you are not a “covered person” under the Personal Investing Policy, certain general principles apply to you, and you should not trade based on any Capital company’s confidential, proprietary investment information where fund or client trades are likely to be pending or imminent.

·	Other types of information (for example, marketing plans, employment issues, shareholder identities, etc.) may also be confidential and should not be shared with individuals outside the company (except those retained to provide services for the Capital companies).

Excessive trading of Capital-managed Funds - - You should not engage in excessive trading of the American Funds or any other Capital-managed investment vehicles worldwide to take advantage of short-term market movements. Excessive activity, such as a frequent pattern of exchanges, could involve actual or potential harm to shareholders or clients. Note that this applies to your spouse and any other immediate family members.

Ban on Participation in IPOs - - Capital associates and their immediate family members residing in their household may not participate in Initial Public Offerings (IPOs). Although exceptions are rarely granted, they will be considered on a case-by-case basis, for example, where a family member is employed by the IPO Company and IPO shares are considered part of that family member’s compensation.

Limitation on Service on Boards - - Associates are discouraged from serving on the board of directors or advisory board of any public or private company (this does not apply to boards of Capital companies or funds). You must receive approval prior to serving on a board, except for boards of charitable organizations or other nonprofit organizations. In addition, certain associates will be sent a form annually and asked to disclose their board positions.

Failure to adhere to our Code of Ethics may result in disciplinary action being taken, including termination.

Annual Certification of Code of Ethics

Each associate will receive a copy of the Code of Ethics annually and is responsible for certifying in writing that they have read and understood the Code.

Reporting Violations

You have a responsibility to report any violations of our Code of Ethics, including: (i) fraud or illegal acts involving any aspect of our business; (ii) noncompliance with applicable laws, rules and regulations; (iii) intentional or material misstatements in our regulatory filings, internal books and records or client records or reports; or (iv) activity that is harmful to our clients or fund shareholders. Deviations from controls or procedures that safeguard the company, including the assets of shareholders and clients, should also be reported. Reported violations of the Code of Ethics will be investigated and appropriate actions will be taken.

You can report confidentially to:

·	Your manager or department head

·	Capital’s Audit Committee

·	any other lawyer employed by the Capital organization

Capital Gifts and Entertainment Policy - Conflicts of Interest

A conflict of interest occurs when the private interests of associates interfere or could potentially interfere with their responsibilities at work. Associates must not place themselves or the company in a position of actual or potential conflict. Associates may not accept gifts worth more than U.S.$100.00, excessive business entertainment, loans, or anything else involving personal gain from those who conduct business with the company. In addition, a business entertainment event exceeding U.S. $250.00 in value should not be accepted unless the associate receives permission from his/her manager or supervisor and the Gifts and Entertainment Policy Committee.

Gifts or entertainment that are reimbursed by Capital do not need to be reported (or pre-cleared). The expenses, however, are subject to the approval of the associate’s manager. When giving a gift or extending entertainment on behalf of Capital, it is important to keep in mind that giving an extravagant gift or entertaining excessively or lavishly may create the appearance of conflict. Associates should also be aware that certain laws or rules may prohibit or limit gifts or entertainment extended to public officials -- especially those responsible for investing public funds.

Charitable Contributions

In soliciting donations from various people in the business community, associates must never allow the present or anticipated business relationships of Capital or any of its affiliates to be a factor in soliciting such contributions.

Reporting

The limitations on accepting gifts applies to all associates as described above, and all associates will be asked to fill out quarterly disclosures. You must report any gift exceeding U.S. $50.00 in value and business entertainment in which an event exceeds U.S. $75.00. (although it is recommended that you report all gifts and entertainment)

Gifts and Entertainment Policy Committee

The Gifts and Entertainment Policy Committee oversees administration of and compliance with the Policy.

Political Contributions Policy

Making Political Contributions -- One of the objectives of Capital's Code of Ethics is to ensure that conflicts of interest do not arise as a result of an associate's position at Capital. Contributions (financial or non-financial) made to certain political campaigns may raise potential conflicts of interest because of the ability of certain office holders to direct business to Capital. For example, contributions to any person currently holding a city, county or state treasurer position or any candidate running for these offices may raise concerns. As a result, associates should not make contributions to any person currently holding these positions or running for these positio ns . Associates are also encouraged to seek guidance for contributions to other political offices that may have the power to influence the choice of a Capital company or the American Funds to manage public funds. These policies also apply to an associate's spouse . Pre-clear requests or questions may be directed to the staff of the Political Contributions Committee. The Political Contributions Committee will evaluate questions relating to potential political contributions considering, among other things: 1) an associate’s relationship with the candidate ( i.e. , is the relationship a personal or business one) and 2) the candidate's current or potential relationship with Capital.

As a general matter, contributions to candidates for U.S. President, Senate, House of Representatives and contributions to national political parties are permissible (unless the candidate currently holds an office that may raise potential conflict of interest issues as described above). Likewise, unless you are subject to the special “CollegeAmerica” requirements (described below), contributions to State Governor and State Representative positions and state political parties are permissible.

Special Political Contribution Requirements -- CollegeAmerica -- Certain associates involved with "CollegeAmerica," the American Funds 529 College Savings Plan sponsored by the Commonwealth of Virginia will receive a special reporting form. These associates are subject to additional restrictions and reporting requirements. For example, these associates generally may not contribute to Virginia political candidates or parties, must report contributions to any other state or municipal candidates or parties, and must pre-clear Political Action Committee (PAC) contributions.

Soliciting Political Contributions -- In soliciting political contributions from various people in the business community, you must never allow the present or anticipated business relationships of any Capital company to be a factor in soliciting such contributions.

Other Considerations -- Please keep in mind that any political contributions that you make or solicit should be viewed as personal . Therefore, you should not use Capital letterhead for correspondence regarding these contributions, and you should not hold fundraising events in Capital offices.

Insider Trading

Antifraud provisions of U.S. securities laws as well as the laws of other countries generally prohibit persons in possession of material non-public information from trading on or communicating the information to others. Sanctions for violations can include civil injunctions, permanent bars from the securities industry, civil penalties up to three times the profits made or losses avoided, criminal fines and jail sentences.

While investment research analysts are most likely to come in contact with material non-public information, the rules (and sanctions) in this area apply to all Capital associates and extend to activities both within and outside each associate's duties. Any associate who believes that he or she may have material non-public information should contact a Capital lawyer .

Personal Investing Policy

As an associate of The Capital Group Companies, you may have access to confidential information. This places you in a position of special trust. You are associated with a group of companies that is responsible for the management of many billions of dollars belonging to mutual fund shareholders and other clients. The law, ethics and our own policy place a heavy burden on all of us to ensure that the highest standards of honesty and integrity are maintained at all times.

There are several rules that must be followed to avoid possible conflicts of interest in personal investments. Keep in mind, however, that placing the interests of clients and fund shareholders first is the core principle of our policies and applies even if the matter is not covered by a specific provision. The following is only a summary of the Capital Personal Investing Policy. Please refer to the Capital Personal Investing Policy for more detailed information about personal investing rules.

The following provisions apply only to associates covered under the Personal Investing Policy.

Covered Persons

You are a “covered person” if you have access to non-public investment information relating to current or imminent fund/client transactions. If you are a “covered person” you should be receiving quarterly personal investing disclosure forms.

Covered persons must conduct their personal securities transactions in such a way that they do not conflict with the interests of the funds and client accounts. This policy also includes securities transactions of family members living in the covered person's household and any trust or custodianship for which the associate is trustee or custodian. A conflict may occur if you, or a family member in the same household, or a trust or custodianship for which you are trustee or custodian, have a transaction in a security when the funds or client accounts are considering or concluding a transaction in the same security. For purposes of this Policy, “covered persons” include immediate family members living in the same household .

Additional rules apply to "investment associates" including portfolio counselors/managers, investment analysts and research associates, trading associates including trading assistants, and investment administration, portfolio control and fixed income control associates including assistants (see below).

Prohibited Transactions for Covered Persons

· IPO investments

· Writing puts and calls on securities that are subject to pre-clearance

· Short sales of securities that are subject to pre-clearance

Initial and Annual Holdings Reports

Any associate that becomes a covered person must submit a list of portfolio holdings and securities accounts within 10 calendar days of becoming covered. In addition, all covered associates will be required to review and update their holdings and securities account information annually.

Pre-clearance of Securities Transactions

Covered persons must receive approval before buying or selling securities including (but not limited to):

·	stocks of companies (public or private, including purchases through private placements)

·	bonds (except U.S. government bonds or other sovereign government bonds rated AAA or Aaa or equivalent)

·	investments in/capital calls of venture capital partnerships and hedge funds

·	options on securities subject to pre-clearance (the exercise of options must also be pre-cleared)

·	closed-end funds (including investment trust companies)

·	index funds or exchange-traded funds that are not on the pre-approved list of index funds/ETFs

·	transactions in securities subject to pre-clearance in IRAs (or company-sponsored retirement accounts) and in Personal Equity Plans (PEPs) and Individual Savings Accounts (ISAs) (available in the U.K. only) over which you have discretion

Before buying or selling securities, covered persons must check with the staff of the Personal Investing Committee.

Pre-clear requests will be handled during the hours the New York Stock Exchange (“NYSE”) is open (generally 6:30am to 1:00pm Pacific Time).

You will generally receive a response within one business day. Unless a different period is specified, clearance is good until the close of the NYSE on the day that you check. Associates from offices outside the U.S. and/or associates trading on non-U.S. exchanges are usually granted enough time to complete their transaction during the next available trading day. If you have not executed your transaction within this period, you must again pre-clear your transaction. Note that investments in private companies (e.g., private placements) and venture capital partnerships must be pre-cleared and reported and are subject to special review. In addition, opportunities to acquire a stock that is “limited” (i.e., a broker-dealer is only given a certain number of shares to sell and is offering the opportunity to buy) would be subject to the Gifts and Entertainment Policy.

Exception for De Minimis Transactions

The de minimis exception is NOT available for CIKK associates (a Capital company based in Tokyo) or associates considered investment associates .

All other covered associates may execute one single transaction (either a buy or a sell) of 100 shares or less per issuer per calendar month without pre-clearance. You must, however, still report these trades on your quarterly form. If you request pre-clearance and are denied permission, you may not execute a de minimis transaction in that issuer without pre-clearance for a period of seven calendar days. Larger or more frequent share transactions must be pre-cleared .

Reporting Transactions

Covered persons must submit quarterly disclosure of certain transactions. If you are covered, you will receive reporting forms each quarter that are due no later than 15 calendar days after the end of the quarter. 2 Reports will be reviewed by the staff of the Personal Investing Committee. Transactions of securities (including fixed-income securities) or options must be pre-cleared as described above and reported except as outlined below:

Report Only (no need to pre-clear):

·	purchases and sales of CRMC Managed Funds

Note that American Funds transactions in Capital’s 401(k) or MRP accounts or in accounts held with American Funds Service Company (AFS)/Capital Bank & Trust (CB&T) where the account number has been previously disclosed need not be reported

·	purchases and sales of Other Capital Affiliated Funds

Note that transactions in the LDO Personal Pension Plan need not be reported if you have a signed data release form on file with LDO Legal

·	purchases and sales of GIG Advised/Sub-Advised Funds and Insurance Products

·	purchases and sales (including options and futures) of index funds or exchange traded funds that are on the pre-approved list of index funds/ETFs

·	participation in any CGII private equity fund/partnership

de minimis transactions (see above)

·	distributions of stock from venture capital partnerships

· gifts or bequests (either receiving or giving) of securities (note that sales of securities, subject to pre-clearance, received as a gift must be both pre-cleared and reported)

· sales pursuant to tender offers

Do Not Pre-clear or Report:

·	open-end investment companies (i.e., mutual funds, OEICs, SICAVs, FCPs, UCITs, Unit Trusts (U.K.) or Japanese investment trusts and investment company funds) except funds advised or sub-advised by any Capital company

(Note: all other funds should be pre-cleared and reported)

· money market instruments or other short-term debt instruments with maturities (at issuance) of one year or less that are rated in one of the highest two rating categories by a Nationally Recognized Statistical Rating Organization or unrated but of equivalent quality

· direct obligations of the U.S. Government or bonds issued by sovereign governments outside the U.S. that are rated AAA or Aaa or equivalent

· bankers' acceptances, CDs or other commercial paper

· currencies (including options and futures)

· commodities

transactions in accounts for which you have completely turned over investment decision-making authority to a professional money manager (see “Professionally Managed Accounts” below)

Personal investing should be viewed as a privilege, not a right. As such, the Personal Investing Committee may place limitations on the number of pre-clearances and/or transactions.

Securities Accounts

1. Disclosure of Securities Accounts

The following types of accounts must be disclosed:

· accounts currently holding reportable securities (including any accounts that hold funds advised or sub-advised by a Capital company including accounts held at AFS/CB&T)

· accounts that have the ability to hold reportable securities

· PEP and ISA accounts that hold or have the ability to hold reportable securities

· accounts where you (or an immediate family member residing with you) have completely turned over investment decision-making authority to a professional money manager

You do not need to disclose accounts that can only hold cash, cash equivalents or open-end investment companies (i.e., mutual funds, OEICs, SICAVs, FCPs, UCITs, Unit Trusts (U.K.) or Japanese investment trusts and investment company funds) other than American Funds or other funds managed by Capital Group

2. Duplicate Account Statements and Trade Confirmations

Duplicate statements and trade confirmations (or other equivalent documentation) are required for accounts currently holding or have the ability to hold securities that are subject to pre-clearance and/or reporting. (This includes 401k and other retirement accounts with previous employers and excludes American Funds accounts where records are held at American Funds Service Company and the account information has been previously disclosed and the LDO Personal Pension Plan where a signed data release form is on file with LDO Legal). Covered persons should inform their investment broker-dealer, bank, securities firm or money management firm that they are employed by an investment management organization.

In addition, covered persons must direct their broker-dealer, bank, securities firm or money management firm to send duplicate trade confirmations and account statements (or other equivalent documentation) for all new or existing accounts on a timely basis to the appropriate address listed below. If they are not able to send duplicates directly, you should submit copies of all trade confirmations (or other equivalent documentation) and account statements as soon as they become available.

All documents received are kept strictly confidential and are maintained by LAO Legal in accordance with applicable Federal Securities laws. 3

If your broker requires a letter requesting duplicate trade confirmations and monthly statements, please contact the staff of the Personal Investing Committee.

If your broker will be sending confirmation statements for an immediate family member with a different last name than you, you should inform the staff of the Personal Investing Committee with the name of the family member and that person’s relationship to you.

3. Professionally Managed Accounts

If you have an account where you have completely turned over decision-making authority to a professional money manager (who is not covered by our policy), you should have a signed “Professionally Managed Account Exception Memo” on file with the staff of the Personal Investing Committee. (This memo is not required for Personal Investment Management “PIM” accounts.) You must disclose the existence of these accounts and provide the account numbers on your personal investing disclosure forms. You do not need to pre-clear or report securities transactions in these accounts.

Additional Policies for “Investment Associates”

1. Investment Associates

Unless otherwise specified, the term “investment associates” includes: portfolio counselors/managers, investment analysts and research associates, trading associates including trading assistants, and investment administration, portfolio control and fixed income control including assistants.

Disclosure of Personal Ownership of Recommended Securities

Portfolio counselors/managers and analysts will be asked on a regular basis to disclose securities that they own both personally and professionally and, for analysts, securities that they hold personally that are within their research coverage. This disclosure will be reviewed on a periodic basis by the staff of the Personal Investing Committee and may also be reviewed by the CRMC and CGTC Executive Committees or other appropriate Capital Committees. In addition, to the extent that disclosure has not already been made to the Personal Investing Committee (by including information on the quarterly form), any associate who is in a position to recommend the purchase or sale of securities by the fund or client accounts that s/he personally owns should first disclose such ownership either in writing (in a company write-up) or verbally (when discussing the company at investment meetings) prior to making a recommendation. 4 If you have any questions, you should contact the staff of the Personal Investing Committee.

3. Blackout Periods

Investment associates may not buy or sell a security during a period beginning seven calendar days before and ending seven calendar days after a fund or client account transacts in that issuer. The blackout period applies to trades in the same management company with which the associate is affiliated. If a fund or client account transaction takes place in the seven calendar days following a pre-cleared transaction by an investment associate, the personal transaction may be reviewed by the Personal Investing Committee to determine the appropriate action, if any. For example, the Committee may recommend that the associate be subject to a price adjustment to ensure that he or she has not received a better price than the fund or client account.

4. Ban on short-term trading profits

Investment associates are generally prohibited from profiting from the purchase and sale or sale and purchase of the same (or equivalent) securities within 60 days. This restriction applies to the purchase of an option and the exercise of the option within 60 days .

Other Considerations

Associates may not accept negotiated commission rates or any other terms that they believe may be more favorable than the broker-dealer grants to accounts with similar characteristics. U.S. broker-dealers are subject to certain rules designed to prevent favoritism toward such accounts.

In addition material outside business interests may give rise to potential conflicts of interest. Associates are asked to report if they are a senior officer of or own more than 5% of any private or public company that is or potentially may be doing business with any Capital company or with the American Funds. This reporting requirement also applies to any immediate family member residing within the associate’s household.

Personal Investing Committee

Any questions or hardships that result from these policies or requests for exceptions should be referred to Capital's Personal Investing Committee.

1 Note that if you have access to non-public information regarding securities recommendations and holdings but you are not currently considered “covered” under the Personal Investing Policy ( i.e. , you do not receive a reporting form each quarter), you should contact the staff of the Personal Investing Committee to discuss.

2 For compliance purposes, only those signed and dated greater than 30 days past the end of the quarter will be considered “late”.

3 Information about particular transactions may be provided to an associate’s supervisor or appropriate Human Resources manager by Personal Investing Committee staff where the transactions are in violation of the Policy, may impact the associate’s job performance, or raise conflict of interest-related issues.

4 Note that this disclosure requirement is consistent with both AIMR standards as well as the ICI Advisory Group Guidelines.