Spirit of America Investment Fund Inc, et al. – ‘485APOS’ on 5/24/02

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Document/Exhibit                   Description                      Pages   Size 

 1: 485APOS     Pea No. 6 to Form N-1A Registration Statement         47    191K 
 2: EX-99.23G   Custodian Services Agreement                          25     62K 

485APOS   —   Pea No. 6 to Form N-1A Registration Statement
Document Table of Contents

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 FORM N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933         [_]             
Pre-Effective Amendment No.            [_]                            
Post-Effective Amendment No. 6         [X]                            
---           

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [_]             

Amendment No. 8                        [X]                            
---                                         

 SPIRIT OF AMERICA INVESTMENT FUND, INC.
(Exact name of Registrant as specified in charter)

477 Jericho Turnpike
 Syosset, New York 11791
(Address of principal executive offices)

(516) 390-5555
 Registrant's Telephone Number

Mr. David Lerner
SSH Securities, Inc.
477 Jericho Turnpike
 Syosset, New York 11791
 (Name and address of Agent for Service)

Copies to:

Stephanie Djinis, Esq.
 1749 Old Meadow Road, Suite 310
McLean, Virginia 22102

It is proposed that this filing will become effective (check appropriate box).  

[_]  immediately upon filing pursuant to paragraph (b) of Rule 485            
[_]  on (date) pursuant to paragraph (b) of Rule 485                          
[_]  60 days after filing pursuant to paragraph (a)(1) of Rule 485            
[_]  on (date) pursuant to paragraph (a)(1) of Rule 485                       
[X]  75 days after filing pursuant to paragraph (a)(2) of Rule 485            
[_]  on (date) pursuant to paragraph (a)(2) of Rule 485                       

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 SPIRIT OF AMERICA INVESTMENT FUND, INC.

Spirit of America Value Fund

Prospectus

August 7, 2002

THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED THESE    
SECURITIES OR PASSED UPON THE ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.                                             

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 TABLE OF CONTENTS
 -----------------

                                                                [Download Table]

                                                                      Page
                                                                      ----
                                                                          
A SUMMARY OF THE FUND..................................................  1
FEES AND EXPENSES OF THE FUND..........................................   
     Example...........................................................   
INVESTMENT OBJECTIVES, PRINCIPAL INVESTMENT STRATEGIES AND                
RELATED RISKS..........................................................   
MANAGEMENT OF THE FUND.................................................   
     Investment Adviser................................................   
     Portfolio Manager.................................................   
PRICING FUND SHARES....................................................   
HOW TO PURCHASE SHARES.................................................   
     General...........................................................   
     Purchases by Mail.................................................   
     Purchases by Wire.................................................   
     Purchases through Broker-Dealers..................................   
     Purchases by Telephone............................................   
     Subsequent Investments............................................   
DISTRIBUTION ARRANGEMENTS..............................................   
     Rule 12b-1 Plan...................................................   
     Fund Shares.......................................................   
     Sale of Fund Shares...............................................   
     Reduced Sales Charges.............................................   
     Sales at Net Asset Value..........................................   
HOW TO REDEEM SHARES...................................................   
     Redemption by Mail................................................   
     Redemption by Telephone...........................................   
     General Redemption Information....................................   
     Minimum Balances..................................................   
SPECIAL SERVICES.......................................................   
     Automatic Investment Plan.........................................   
     Systematic Cash Withdrawal Plan...................................   
DIVIDENDS, DISTRIBUTIONS AND TAXES.....................................   
     Dividends and Distributions.......................................   
     U.S. Federal Income Taxes.........................................   
FINANCIAL HIGHLIGHTS...................................................   

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 A SUMMARY OF THE FUND

Investment Objective. The Spirit of America Value Fund (the "Fund") seeks to    
provide capital appreciation with a secondary objective of current income.      

Principal Strategies. The Fund focuses on the value segment of the U.S. equity  
market. The Fund invests at least 80% of its total assets in equity securities  
of companies in the value segment of the market. Using the "value" approach, the
Fund's adviser buys those securities considered to be conservatively valued     
relative to the securities of comparable companies.                             

Investment Risks. Any investment involves risk. The risks associated with an    
investment in the Fund include:                                                 

    . Market Risk - The market value of the Fund's investments fluctuates as
 the equity market fluctuates. Market risk may affect a single issuer,
      industry or section of the economy or it may affect the market as a whole.

     . Mid-Capitalization Company Risk - The investments in mid-capitalization
companies may be more volatile than investments in larger, better   
capitalized companies.                                              

. Volatility Risk - The performance of the Fund can be affected by  
      unexpected events (e.g., significant earnings shortfalls or gains, war, or
     political events) that cause major price changes in individual securities
or market sectors.                                                  

    . The stocks purchased by the Fund, while believed by the Fund's adviser
      to be undervalued, may not appreciate in value as the adviser anticipates.

. The potential loss of your investment in the Fund if the Fund     
depreciates in value.                                               

What is a Value Fund?                                                           

A value fund generally emphasizes stocks of companies that are believed to be   
fundamentally attractive based on certain valuation factors. These stocks       
generally have growth prospects regarded as subpar by the market. Reflecting    
these market expectations, the prices of value stocks typically are             
below-average in comparison with such factors as revenue, earnings, book value  
and dividends.                                                                  

Suitability. An investment in the Fund may be suitable for long-term investors  
who seek appreciation of capital. Investors should be willing to accept the     
potential volatility of such investments.                                       

Bar Chart and Performance Table                                                 

Because the Fund commenced operations as of the date of this prospectus, no     
performance information is being presented in this prospectus. Once the Fund has
a performance history of at least one calendar year, a bar chart and performance
table will be included. The Fund's annual returns will also be compared to the  
returns of a benchmark index.                                                   

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 FEES AND EXPENSES OF THE FUND

This table describes the fees and expenses that you may pay if you buy and hold 
shares of the Fund.                                                             

Shareholder Fees (paid directly from your investment) 

Maximum Sales Charge (Load) Imposed on Purchases          5.25%(1)  
(as a percentage of offering price)                                 

Maximum Deferred Sales Charge (Load) Imposed on           1.00%(2)  
Redemptions (as a percentage of the lesser of original              
purchase price or redemption proceeds)                              

Annual Fund Operating Expenses: (expenses that are deducted from Fund assets)   

Management Fees                                                     0.97% 
Distribution and Service (12b-1) Fees                               0.30% 
  Other Expenses                                                      1.52%(3)
                                                              --------
Total Annual Fund Operating Expenses                                2.79% 
                                                              ========
Less Fee Waiver and/or Expense Reimbursement                       (0.82%)
                                                              --------
  Net Annual Operating Expenses                                       1.97%(4)
                                                              ========

(1)  Reduced for purchases of $100,000 and over, decreasing to zero for         
purchases of $1 million and over. See "Distribution Arrangements."    

(2)  A Contingent Deferred Sales Charge ("CDSC") of 1.00% may be imposed on     
redemptions of $1 million or more made within one year of the date of 
purchase. See "Distribution Arrangements."                            

(3)  Fee based on an estimate for current fiscal year.                          

(4)  Spirit of America Management Corp. (the "Adviser") has contractually agreed
to waive advisory fees and/or reimburse expenses under an Operating   
 Expenses Agreement so that the total operating expenses will not exceed
   1.97% of the average daily net assets of the Fund. The Adviser has agreed
to waive advisory fees and/or reimburse expenses for the Fund until   
February 24, 2003. Any amounts waived or reimbursed by the Adviser are
subject to reimbursement by the Fund within the following three years,
provided the Fund is able to make such reimbursement and remain in    
compliance with the expense limitations stated above. This Operating  
    Expenses Agreement shall continue for additional one-year terms, absent 60
days' notice from the Adviser.                                        

Example                                                                         

This Example 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;          

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.  you redeem all of your shares at the end of those periods;             

.  your investment has a 5% return each year; and                         

 .  the Fund's operating expenses for the one-year period are calculated net
     of any fee waivers and/or expense reimbursements and the Fund's operating
expenses for the other periods do not reflect any fee waivers and/or
expense reimbursements.                                             

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

1 year                       3 years
 -----------------------------------------------
$714                         $1,271 

You would pay the same amount of expenses if you did not redeem your shares.    

INVESTMENT OBJECTIVES, PRINCIPAL INVESTMENT STRATEGIES AND
 RELATED RISKS

Investment Objectives. Capital appreciation with a secondary objective of       
current income.                                                                 

General. The Fund invests at least 80% of its total assets in equity securities 
of companies in the value segment of the market. In order to achieve current    
income, the Fund will invest in equity securities with a proven history of      
paying consistent dividends.                                                    

The investments of the Fund are publicly registered companies, which are        
generally listed on the New York or American Stock Exchanges or NASDAQ. The Fund
will focus on companies which may be established in their industry, but are     
deemed to be undervalued by the Fund's adviser. As part of the investment       
process, the Fund's adviser also looks at the economic viability of a company   
and its market sector, as well as the ability of management to add significant  
value through strategic focus and operating expertise. The Fund is restricted   
from investing more than 15% of its total assets in illiquid investments or     
private placements of unregistered securities.                                  

Temporary Investments. From time to time, the Fund may take temporary defensive 
positions that are inconsistent with its principal investment strategies. For   
temporary defensive purposes, the Fund may invest in publicly traded debt       
instruments such as government and corporate bonds or mortgage backed           
securities. The Fund will assume a temporary defensive position only when       
economic and other factors adversely affect the equity market. When the Fund    
maintains a temporary defensive position, it may not achieve its investment     
objective.                                                                      

Stock Market Risks. The market value of the Fund's investments will fluctuate as
the equity market fluctuates. Market risk may affect a single issuer, industry  
or section of the economy or it may affect the market as a whole. The           
investments in mid-capitalization companies may be more volatile than           
investments in larger, better capitalized companies. Performance of the Fund can
be affected by unexpected events (e.g., significant earnings shortfalls or      
gains, war, or political                                                        

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events) that cause major price changes in individual securities or market       
sectors. The stocks purchased by the Fund may not appreciate in value as the    
Adviser anticipates.                                                            

Value Investing . The value approach to investing involves the risk that the    
stocks selected by the Adviser may remain undervalued. Value stocks as a group  
may be out of favor and underperform the overall equity market for a long period
of time, while the market concentrates on "growth" stocks. In addition, the Fund
may have to forgo investments that show growth potential if they are            
inconsistent with its value investment strategy.                                

Value funds often focus many of their investments in certain industries, and    
thus will be more susceptible to factor adversely affecting issuers within that 
industry than would a more diversified portfolio of securities.                 

MANAGEMENT OF THE FUND

Investment Adviser                                                              

Spirit of America Management Corp. ("Spirit Management" or the "Adviser"), 477  
Jericho Turnpike, Syosset, New York 11791, is the Fund's investment adviser.    
Spirit Management was incorporated in 1997 and is a registered investment       
adviser under the Investment Advisers Act of 1940, as amended. Spirit Management
has managed the investments of the Spirit of America Real Estate Fund, another  
portfolio of the Company, since that Fund's inception in January of 1998 and has
no other assets under management.                                               

Spirit Management invests the Fund's assets, manages the Fund's business affairs
and supervises the Fund's day-to-day operations. Spirit Management provides the 
Fund with advice on buying and selling securities in accordance with the Fund's 
investment objective, policies and limitations. Spirit Management also furnishes
office space and certain administrative and clerical services, and employs the  
personnel needed with respect to Spirit Management's responsibilities under its 
investment advisory contract with the Fund.                                     

The Fund pays Spirit Management a fee at the annual rate of 0.97% of the Fund's 
average daily net assets. The fee is accrued daily and paid monthly.            

Portfolio Manager                                                               

Ronald W. Weiss, since May 1997 has been portfolio manager of the Spirit of     
America Real Estate Fund and is primarily responsible for the day-to-day        
management of the Fund's portfolio. Mr. Weiss has spent over twenty years in the
real estate finance and investment banking industry, which includes debt and    
equity financing, real estate investment trusts, asset management, new          
investment product development and venture capital transactions for financial   
services firms. Most recently, Mr. Weiss was Senior Vice President of Gilford   
Securities, Inc., New York, NY from April, 1996 to May, 1997. Mr. Weiss was     
Senior Real Estate Investment Trust Analyst and Vice President of First Albany  
Corporation, New York, NY from 1994 through April of 1996. Prior to that, Mr.   
Weiss was Managing Director and Real Estate General Counsel for Primerica       
Corporation, New York, NY from 1991 to 1994. From 1972 through 1990 he served as
founder,                                                                        

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Chairman and CEO of Shearson Lehman Real Estate Corporation, Executive Vice     
President of Shearson Lehman Brothers, Inc., and an officer and director of     
thirty-five Shearson subsidiary companies.                                      

 PRICING FUND SHARES

Portfolio securities are valued and the net asset value per share ("NAV") of the
Fund is calculated as of the close of regular trading on the New York Stock     
Exchange ("NYSE"), currently 4:00 p.m. (Eastern Time) on each day the NYSE is   
open for trading. The NYSE is closed on the following holidays or days on which 
the following holidays are observed: New Year's Day, Martin Luther King, Jr.    
Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,   
Thanksgiving Day and Christmas Day.                                             

The NAV is computed by adding the value of the Fund's investments, cash and     
other assets attributable to the Fund, deducting liabilities of the Fund and    
dividing the result by the number of shares outstanding. Expenses are accrued   
daily and applied when determining the NAV. The Fund's equity securities are    
valued based on the last reported sales price on the principal exchange on which
the security trades, or if no sales price is reported, the mean of the latest   
bid and asked prices is used. Securities traded over-the-counter are priced at  
the mean of the latest bid and asked prices.                                    

Short-term investments having a maturity of 60 days or less are valued at       
amortized cost, which the Board of Directors believes represents fair value.    
When a security is valued at amortized cost, it is valued at its cost when      
purchased, and thereafter by assuming a constant amortization to maturity of any
discount or premium, regardless of the impact of fluctuating interest rates on  
the market value of the instrument. All other securities and other assets are   
valued at their fair value as determined in good faith under procedures         
established by and under the supervision of the Board of Directors.             

HOW TO PURCHASE SHARES

General                                                                         

You can purchase shares of the Fund through broker-dealers that have executed a 
selling agreement with the Fund's distributor, SSH Securities, Inc. (the        
"Distributor"). Fund shares are sold at the NAV next determined after receipt by
the Fund's transfer agent, PFPC Inc. (the "Transfer Agent"), plus an initial    
maximum sales charge of up to 5.25% of the offering price (5.54% of the net     
amount invested) reduced on investments of $100,000 or more. The minimum initial
investment is $500; the minimum subsequent investment is $50. See "Distribution 
Arrangements."                                                                  

Purchase orders for shares of the Fund that are received by the Transfer Agent  
in proper form (i.e., a completed application and the correct minimum           
investment) by the close of the NYSE, on any day that the NYSE is open for      
trading, will be purchased at the Fund's next determined NAV (plus any          
applicable sales charge). Orders for Fund shares received after 4:00 p.m.       
Eastern Time                                                                    

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will be purchased at the NAV (plus any applicable sales charge) determined on   
the following business day.                                                     

The Fund and the Transfer Agent each reserves the right to reject any purchase  
order in whole or in part. The Fund reserves the right to suspend the offering  
of its shares. The Fund also reserves the right to vary the initial and         
subsequent investment minimums, or to waive the minimum investment requirements 
for any investor. The Fund will not accept checks endorsed by a third party as  
payment for purchase orders.                                                    

When you sign your account application, you will be asked to certify that your  
Social Security or taxpayer identification number is correct and that you are   
not subject to 30% backup withholding for failing to report income to the       
Internal Revenue Service ("IRS"). If you violate IRS regulations, the IRS can   
require the Fund to withhold 30% of your taxable distributions and redemptions. 

Purchases by Mail                                                               

Shares may be purchased initially by completing the account application         
accompanying this prospectus and mailing it to the Transfer Agent, together with
a check or money order payable to "Spirit of America Value Fund." The check or  
money order and account application should be mailed to PFPC Inc., 211 South    
Gulph Rd., P.O. Box 61767, King of Prussia, PA 19406. If this is an initial     
purchase, please send a minimum of $500 (including IRA and SEP accounts).       

Purchases by Wire                                                               

To invest by wire, you must first telephone the Transfer Agent at (800) 452-4892
to receive an account number. Your name, account number, taxpayer identification
number or social security number and address must be specified in the wire. In  
addition, an account application should be promptly forwarded to: PFPC Inc., 211
South Gulph Rd., P.O. Box 61767, King of Prussia, PA 19406.                     

If you have a commercial bank account at a member firm of the Federal Reserve   
System, you may purchase shares of the Fund by requesting your bank to transmit 
funds by wire to: Boston Safe Deposit & Trust, ABA# 011001234, Credit: Spirit of
America Value Fund, Acct#: 182095, FBO: (Insert name and your account number).  

Your bank may impose a fee for investments by wire. The Fund will not be        
responsible for the consequences of delays, including delays in the banking or  
Federal Reserve wire systems. You may be subject to 30% withholding if the Fund 
does not have complete, correct taxpayer information on file as required by law.

Purchases through Broker-Dealers                                                

The Fund may accept telephone orders only from broker-dealers or financial      
intermediaries that have executed a selling agreement with the Fund's           
distributor. The broker-dealers or financial intermediaries must promptly       
forward purchase orders and payments for the same to the Fund. Brokers or       
financial intermediaries through which an investor purchases shares of the Fund 
may                                                                             

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charge the shareholder a transaction fee or other fee for their services at the 
time of purchase. Minimum investments through broker/dealers or accounts opened 
through a mutual fund network may apply.                                        

For any order to be confirmed at the current day's offering price, it must be   
received by the Transfer Agent or the selling dealer by 4:00 p.m. Eastern Time  
on the same day. For any dealer order to be confirmed at the current day's      
offering price, it must be received by the dealer prior to 4:00 p.m. Eastern    
Time on that day, and communicated to the Transfer Agent by 5:00 p.m. Eastern   
Time on that day. It is the responsibility of the dealer to communicate the     
details of the order to the Transfer Agent. Orders received by dealers after    
4:00 p.m. Eastern Time are confirmed at the offering price on the following     
business day.                                                                   

Purchases by Telephone                                                          

The Fund only accepts telephone purchases from brokers or financial             
intermediaries. Individuals may not make purchases by telephone.                

Subsequent Investments                                                          

You may make subsequent purchases by mail, bank wire, automatic investing or    
direct deposit. The minimum for subsequent investments $50 for all accounts.    

When making subsequent investments by mail, please return the bottom portion of 
a previous confirmation with your investment in the envelope that is provided   
with each confirmation statement. Your check should be made payable to "Spirit  
of America Value Fund" and mailed to PFPC Inc., 211 South Gulph Road, P.O. Box  
61767, King of Prussia, PA 19406. Orders to purchase shares receive the NAV     
calculated, on the day the Transfer Agent receives your check or money order,   
provided it is received before 4 p.m. Eastern Time.                             

All investments must be made in U.S. dollars and, to avoid fees and delays,     
checks must be drawn only on banks located in the United States. A charge       
(minimum of $20) will be imposed if any check used for the purchase of shares is
returned. Investors who purchase Fund shares by check or money order may not    
receive redemption proceeds until there is reasonable belief that the purchase  
check has cleared, which may take up to eight business days after the purchase  
date.                                                                           

You may make additional investments at any time through the wire procedures     
described above, which must include your name and account number.               

 DISTRIBITION ARRANGEMENTS

The Fund charges a front-end sales load and pays a 12b-1 fee.                   

Rule 12b-1 Plan                                                                 

The Fund has adopted a plan of distribution (the "12b-1 Plan") pursuant to Rule 
12b-1 under the Investment Company Act of 1940, as amended (the "1940 Act"). The
Plan permits the Fund to pay the Distributor, from the assets of the Fund, a    
monthly fee at an annual rate of 0.30% of the                                   

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Fund's average net assets for the Distributor's services and expenses in        
distributing shares of the Fund ("distribution fees") and providing personal    
services and/or maintaining shareholder accounts ("service fees"). Since 12b-1  
fees are paid out of the assets of the Fund on an on-going basis, over time     
these fees will increase the cost of your investment and may cost you more than 
paying other types of sales charges.                                            

Fund Shares                                                                     

The offering price for Fund shares includes a front-end sales charge. The       
maximum sales charge is 5.25% of the offering price (5.54% of the net amount    
invested) and is reduced on investments of $100,000 or more. Certain purchases  
of shares qualify for reduced front-end sales charges.                          

Sale of Fund Shares                                                             

The sales charge you pay for shares depends on the dollar amount invested, as   
shown in the table below.                                                       

                                                        [Enlarge/Download Table]

                                ---------------------------------------------------------
                                                   Total Sales Charge                    
                                                   as a Percentage of                    
                                                   ------------------                    
                                ---------------------------------------------------------
                                      Offering Price             Net Amount Invested     
                                      --------------             -------------------     
-----------------------------------------------------------------------------------------
                                                                                         
Under $100,000                             5.25%                        5.54%            
-----------------------------------------------------------------------------------------
$100,000 but less than                     4.50%                        4.71%            
$250,000                                                                                 
-----------------------------------------------------------------------------------------
$250,000 but less than                     3.75%                        3.89%            
$500,000                                                                                 
-----------------------------------------------------------------------------------------
$500,000 but less than                     3.00%                        3.09%            
$1,000,000                                                                               
-----------------------------------------------------------------------------------------
$1,000,000 or more*                           0%                           0%            
-----------------------------------------------------------------------------------------

        * No sales charge is payable at the time of purchase on investments of
       $1 million or more, although for such investments, the Fund imposes a
      CDSC of 1.00% in the event of certain redemptions within one year of
the purchase. The CDSC incurred upon redemption is paid to the
   Distributor in reimbursement for distribution-related expenses. A
   commission may be paid to authorized dealers who initiate and are
responsible for purchases of $1 million or more.              

The Distributor will pay a dealer concession to those authorized dealers who    
have entered into an agreement with the Distributor. The dealer's concession may
be changed from time to time. The Distributor may, from time to time, offer     
incentive compensation to dealers that sell shares of the Fund subject to sales 
charges, allowing such dealers to retain an additional portion of the sales     
load. On some occasions, such cash or incentives will be conditioned upon the   
sale of a specified minimum dollar amount of the shares of the Fund during a    
specified period of time. A                                                     

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dealer who receives all or substantially all of the sales load may be considered
an "underwriter" under the Securities Act of 1933, as amended. All such sales   
charges are paid to the securities dealer involved in the trade, if any. No     
sales charge is assessed on the reinvestment of dividends or distributions.     

Reduced Sales Charges                                                           

The sales charge for purchases of shares of the Fund may be reduced through     
rights of accumulation or letter of intent. To qualify for a reduced sales      
charge, you must so notify the Transfer Agent at the time of each purchase of   
shares which qualifies for or counts toward the reduction.                      

Rights of Accumulation. If you already own shares of the Fund, reduced sales    
charges for additional shares are applicable to subsequent purchases. The sales 
charge on each additional purchase is determined by adding the current market   
value of the shares currently owned to the amount being invested. The reduced   
sales charge is applicable only to current purchases. You must notify the       
Transfer Agent at the time of subsequent purchase that your purchase is eligible
for the right of accumulation. You must also state your account number, and     
whether the account is held in the name of your spouse or minor children, the   
age of such children, and the specific relationship of each such person to you. 

Letter of Intent. Investors may qualify for a reduced sales charge immediately  
by signing a non-binding letter of intent stating the intent to invest during   
the next 13 months a specified amount which, if made at one time, would qualify 
for a reduced sales charge. The first investment cannot be made more than 90    
days prior to the date of the letter of intent. You must notify the Transfer    
Agent at the time you submit the letter of intent that prior purchases may      
apply. Any redemptions made during the 13-month period will be subtracted from  
the amount of purchases in determining whether the letter of intent has been    
completed. During the term of the letter of intent, the Transfer Agent will hold
shares representing 5% of the indicated amount in escrow for payment of a higher
sales load if the full amount indicated in the letter of intent is not          
purchased. The escrowed shares will be released when the full amount has been   
purchased. If the full amount is not purchased within the 13-month period,      
escrowed shares will be redeemed in an amount equal to the difference in the    
dollar amount of sales charge actually paid and the amount of sales charge that 
would have been paid on total aggregate purchases if such purchases had been    
made at a single time.                                                          

Sales at Net Asset Value                                                        

The Fund may sell shares at NAV (i.e., without any initial sales charge) to     
certain investors, including: (i) investment advisory clients of Spirit         
Management or its affiliates; (ii) (a) officers and present or former directors 
of the Fund, (b) directors and present and full-time employees of selected      
dealers or agents, or the spouse, or minor children of any such person, or any  
trust, individual retirement account or retirement plan account for the benefit 
of any such person or relative, or the estate of any such person or relative, if
such shares are purchased for investment purposes (such shares may not be resold
except to the Fund); (iii) Spirit Management, the Distributor, and their        
affiliates, and certain employee benefit plans for employees of Spirit          

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Management and the Distributor; (iv) persons who establish, to the Distributor's
satisfaction, that they are investing, within such time period as may be        
designated by the Distributor, proceeds of redemption of shares of such other   
registered investment companies as may be designated from time to time by the   
Distributor; (v) employer-sponsored qualified pension or profit-sharing plans   
(including Section 401(k) plans), custodial accounts maintained pursuant to     
Section 403(b)(7) retirement plans and individual retirement accounts (including
individual retirement accounts to which simplified employee pension ("SEP")     
contributions are made) if such plans or accounts are established or            
administered under programs sponsored by administrators or other persons that   
have been approved by the Distributor; and (vi) investors who redeem shares of  
the Fund and then decide to reinvest their redemption proceeds in additional    
shares of the Fund within 30 days of the date of redemption.                    

HOW TO REDEEM SHARES

You may redeem your shares of the Fund on any business day that the NYSE is open
for business. Redemptions will be effective at NAV (subject to any applicable   
CDSC fees) next determined after receipt by the Transfer Agent of a redemption  
request meeting the requirements described below.                               

Redemption by Mail                                                              

You may redeem shares by submitting a written request for redemption to PFPC    
Inc., 211 South Gulph Rd., P.O. Box 61767, King of Prussia, PA 19406. A written 
redemption request must: (i) identify your account name and account number; (ii)
include the name of the Fund; (iii) state the number of shares or dollar amount 
to be redeemed; and (iv) be signed by each registered owner exactly as the      
shares are registered. To prevent fraudulent redemptions, a signature guarantee 
for the signature of each person in whose name an account is registered is      
required for all written redemption requests exceeding $10,000, or where        
proceeds are to be mailed to an address other than the address of record. When  
the Fund requires a signature guarantee you must provide a medallion signature  
guarantee. A medallion signature guarantee may be obtained from a domestic bank 
or trust company, broker, dealer, clearing agency, savings association, or other
financial institution which is participating in a medallion program recognized  
by the Securities Transfer Association. The three recognized medallion programs 
are Securities Transfer Agents Medallion Program (STAMP), Stock Exchanges       
Medallion Program (SEMP) and New York Stock Exchange, Inc. medallion Signature  
Program (NYSE MSP). Signature guarantees from financial institutions which are  
not participating in one of these programs will not be accepted. Notary public  
endorsements will not be accepted. The Transfer Agent may require additional    
supporting documents for redemptions made by corporations, executors,           
administrators, trustees or guardians and retirement plans.                     

A redemption request will not be considered received until the Transfer Agent   
receives all required documents in proper form. Questions with respect to the   
proper form for redemption requests should be directed to the Transfer Agent at 
(800) 452-4892.                                                                 

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Redemption by Telephone                                                         

With prior authorization, you may redeem shares by calling the Transfer Agent at
(800) 452-4892 during normal business hours. To arrange for redemption by wire  
or telephone after your account has been opened, or to change the bank or       
account designated to receive redemption proceeds, send a written request with a
signature guarantee (as described above) to the Transfer Agent.                 

The Fund reserves the right to refuse a wire or telephone redemption if it      
believes it is advisable to do so. Procedures for redeeming Fund shares by wire 
or telephone may be modified or terminated at any time.                         

During periods of unusual economic or market changes, telephone redemptions may 
be difficult to implement. In such event, you should follow the procedures for  
redemption by mail.                                                             

Neither the Fund nor any of its service contractors will be liable for any loss 
or expense in acting upon telephone instructions that are reasonably believed to
be genuine. In this regard, the Fund and the Transfer Agent require personal    
identification information before accepting a telephone redemption. To the      
extent that the Fund or the Transfer Agent fails to use reasonable procedures to
verify the genuineness of telephone instructions, the Fund may be liable for    
losses due to fraudulent or unauthorized instructions. The Fund reserves the    
right to refuse a telephone redemption if it is believed advisable to do so.    
Written confirmation will be provided for all redemption transactions initiated 
by telephone. Proceeds from a telephone redemption shall be sent only to the    
shareholder's address of record or wired to the shareholder's bank account on   
file with the Transfer Agent.                                                   

General Redemption Information                                                  

When a request for redemption is made shortly after the purchase of shares by   
check, you will not receive the redemption proceeds until the check(s) for the  
shares purchased has cleared. Although the redemption proceeds may be delayed,  
the redemption request will be processed at the NAV next determined after       
receipt of the redemption request in good order. The Fund will mail the         
redemption proceeds as soon as the purchase check clears, which may take up to  
eight business days from the date of the purchase. You may avoid such delays by 
purchasing shares by federal funds wire.                                        

Redemption proceeds may be wired directly to any bank previously designated on  
your new account application. There is a $15.00 charge for redemptions made by  
wire to domestic banks. Wires to foreign or overseas banks may be charged at    
higher rates. Banks may impose a fee for wire services. In addition, there may  
be fees for redemptions made through brokers, financial institutions and service
organizations. If you execute your redemption order through an intermediary, you
may be subject to additional charges.                                           

The Fund will satisfy redemption requests for cash to the fullest extent        
feasible, as long as such payments would not, in the opinion of the Board of    
Directors, result in the need for the Fund to sell assets under disadvantageous 
conditions or to the detriment of the remaining shareholders of the Fund. The   
Fund has reserved the right to redeem in-kind, or partly in cash and partly     
in-kind.                                                                        

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The Fund has elected, pursuant to Rule 18f-1 under the 1940 Act, to redeem its  
shares solely in cash up to the lesser of $250,000 or 1% of the NAV of the Fund,
during any 90-day period for any one shareholder. Any portfolio securities paid 
or distributed in-kind would be in readily marketable securities and valued in  
the manner described above. See "Pricing Fund Shares." In the event that an     
in-kind distribution is made, you may incur additional expenses, such as        
brokerage commissions, on the sale or other disposition of the securities       
received from the Fund. In-kind payments need not constitute a cross-section of 
the Fund's portfolio.                                                           

The Fund may suspend the right of redemption or postpone the date of payment for
more than seven days during any period when (i) trading on the NYSE is          
restricted or the NYSE is closed for other than customary weekends and holidays,
(ii) the SEC has by order permitted such suspension for the protection of the   
Fund's shareholders, or (iii) an emergency exists making disposal of portfolio  
securities or valuation of net assets of the Fund not reasonably practicable.   

Minimum Balances                                                                

Due to the relatively high cost of maintaining smaller accounts, the Fund       
reserves the right to involuntarily redeem shares in any account at their then  
current NAV if at any time the account balance is less than $500 as a result of 
shareholder redemptions, but not market fluctuations. You will be notified in   
writing if the value of your account is less than the required minimum, and will
be allowed at least 60 days to bring the value of your account up to the minimum
before the redemption is processed.                                             

SPECIAL SERVICES

Automatic Investment Plan                                                       

You can make additional purchases of shares of the Fund through an automatic    
investment plan. The automatic investment plan provides a convenient method by  
which investors may have monies deducted directly from their bank account for   
investment in the Fund. You may authorize the automatic withdrawal of funds from
your bank account by opening an account with a minimum of $500 and completing   
the automatic investment plan section of the account application enclosed with  
this Prospectus. Subsequent monthly investments are subject to a minimum        
required amount of $50. The Fund may alter, modify or terminate this plan at any
time.                                                                           

Systematic Cash Withdrawal Plan                                                 

The Fund offers a systematic cash withdrawal plan as another option by which to 
withdraw funds from your account on a regular basis. To participate in this     
option, you must either own or purchase shares having a value of $10,000 or     
more. Automatic payments by check will be mailed to you on either a monthly,    
quarterly, semi-annual or annual basis in amounts of $50 or more. All           
withdrawals are processed on the 25th of the month or, if such day is not a     
business day, on the next business day and paid promptly thereafter. Because the
Fund has a front-end sales load, it is not advisable to participate in this     
withdrawal plan if you are regularly purchasing                                 

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shares. For information about starting a systematic cash withdrawal plan, call  
the Transfer Agent at (800) 452-4892.                                           

DIVIDENDS, DISTRIBUTIONS AND TAXES

Dividends and Distributions                                                     

The Fund intends to distribute substantially all of its net investment income   
and capital gains to shareholders each year. Normally, dividends will be paid   
quarterly. Capital gains, if any, will be distributed annually in December, but 
may be distributed more frequently if deemed advisable by the Board of          
Directors. All such dividends and distributions are taxable to the shareholder  
whether received in cash or reinvested in shares. As a result, a portion of the 
distributions paid to the Fund and subsequently distributed to shareholders may 
be a return of capital. The final determination of the amount of the Fund's     
return of capital distributions for the period will be made after the end of    
each calendar year.                                                             

Each income dividend and capital gains distribution, if any, declared by the    
Fund on its outstanding shares will be paid in additional shares of the Fund    
having an aggregate net asset value as of the payment date of such dividend or  
distribution equal to the cash amount of such income dividend or distribution,  
unless payment in cash is specified by the shareholder by written request to the
Fund. Election to receive income dividends and distributions in cash may be made
at the time shares are initially purchased or may be changed in writing at any  
time prior to the record date for a particular dividend or distribution. There  
is no sales or other charge in connection with the reinvestment of dividends and
capital gains distributions.                                                    

If you buy shares just before the Fund deducts a distribution from its NAV, you 
will pay the full price for the shares and then receive a portion of the price  
back as a taxable distribution.                                                 

Any check tendered in payment of dividends or other distributions which cannot  
be delivered by the U.S. post office or which remains uncashed for a period of  
more than one year may be reinvested in the shareholder's account at the then   
current NAV, and the dividend option may be changed from cash to reinvest.      
Interest will not accrue on amounts represented by uncashed checks.             

U.S. Federal Income Taxes                                                       

Dividends representing net investment income and distributions of net short-term
capital gains are taxable as ordinary income. The excess of net capital gains   
over the net capital losses realized and distributed by the Fund to its         
shareholders as capital gains distributions is expected to be taxable to the    
shareholders as long-term capital gains, regardless of the length of time a     
shareholder may have held his or her shares of the Fund.                        

Distributions received by a shareholder may include nontaxable returns of       
capital, which will reduce a shareholder's basis in shares of the Fund. If that 
basis is reduced to zero (which could happen if the shareholder does not        
reinvest distributions and returns of capital are significant) any further      
returns of capital will be taxable as a capital gain.                           

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A distribution will be treated as paid on December 31 of the current calendar   
year if it is declared in October, November or December with a record date in   
such a month and paid during January of the following calendar year. Any        
dividend or distribution received by a shareholder on shares of the Fund will   
have the effect of reducing the NAV of such shares by the amount of such        
dividend or distribution. Furthermore, a dividend or distribution made shortly  
after the purchase of such shares by a shareholder, although in effect a return 
of capital to that particular shareholder, would be taxable to him or her as    
described above. If a shareholder held shares six months or less and during that
period received a distribution taxable to such shareholder as long-term capital 
gain, any loss realized on the sale of such shares during such six-month period 
would be a long-term capital loss to the extent of such distribution.           

A dividend or capital gains distribution with respect to shares of the Fund held
by a tax-deferred or qualified plan, such as an individual retirement account,  
403(b)(7) retirement plan or corporate pension or profit-sharing plan, will not 
be taxable to the plan. Distributions from such plans will be taxable to        
individual participants under applicable tax rules without regard to the        
character of the income earned by the qualified plan.The Fund will be required  
to withhold 30% of any payments made to a shareholder if the shareholder has not
provided a certified taxpayer identification number to the Fund or if the       
shareholder is otherwise subject to backup withholding.                         

Shareholders will be advised annually as to the federal tax status of income    
dividends and capital gains and return of capital distributions made by the Fund
for the preceding year. Distributions by the Fund may be subject to state and   
local taxes. Shareholders are urged to consult their tax advisers regarding     
their own tax situation.                                                        

FINANCIAL HIGHLIGHTS

Financial highlights will be included in the Prospectus after the Fund has a    
performance history. This information will reflect financial results for a      
single Fund share and include total return information.                         

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 The following notice does not constitute part of and is not
 incorporated into the prospectus of the Fund.

 DAVID LERNER ASSOCIATES, INC.
Privacy Policy Statement

David Lerner Associates, Inc. is committed to keeping nonpublic personal        
information about you secure and confidential. This notice is intended to help  
you understand how we fulfill this commitment.                                  

From time to time, we may collect a variety of personal information about you,  
including:                                                                      

 . Information we receive from you on applications or other forms or via
telephone calls with you;                                         

. Information about your transactions with us (such as your purchases,
sales, or account balances); or                                   

. Information we receive from consumer reporting agencies.            

We do not disclose your nonpublic personal information to any non-affiliated    
third parties, except as permitted by applicable law or regulation. For example,
we may share this information with others in order to process your transactions.
We may also provide all of the above information to companies that perform      
marketing or administrative services on our behalf, such as printing and        
mailing, or to other financial institutions with whom we have joint marketing   
agreements. We will require these companies to protect the confidentiality of   
this information and to use it only to perform the services for which we hired  
them.                                                                           

With respect to our internal security procedures, we maintain physical,         
electronic, and procedural safeguards to protect your nonpublic personal        
information, and we restrict access to this information.                        

If you decide at some point either to close your account(s) or become an        
inactive customer, we will continue to adhere to our privacy policies and       
practices with respect to your non-public personal information.                 

This notice also applies to the following entities that may be deemed to be     
affiliated with David Lerner Associates, Inc.:                                  

SSH Securities, Inc.                                              
Spirit of America Investment Fund, Inc.                           

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 [INSIDE BACK COVER]

INVESTMENT ADVISER
Spirit of America Management, Inc.
477 Jericho Turnpike
 Syosset, NY 11791
(516) 390-5575

 DISTRIBUTOR
SSH Securities, Inc.
477 Jericho Turnpike
 Syosset, NY 11791
(516) 390-5565

SHAREHOLDER SERVICES
 PFPC Inc.
 211 South Gulph Rd., P.O. Box 61617
 King of Prussia, PA 19406
(800) 452-4892

 CUSTODIAN
PFPC Trust Company
   8800 Tinicum Boulevard, 3/rd/ Floor
Philadelphia, PA 19153

AUDITORS

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[BACK COVER]

Additional information about the Fund is contained in the Statement of          
Additional Information (the "SAI"). The SAI is incorporated by reference into   
this Prospectus.                                                                

To obtain an SAI for the Fund without charge, or request other information or   
make shareholder inquiries call collect 516-390-5555.                           

The Fund's SAI can be reviewed and copied at the Public Reference Room of the   
Securities and Exchange Commission (the "SEC") in Washington, D.C. Information  
on the operation of the Public Reference Room is available from the SEC by      
calling 202-942-8090. The Fund's SAI is also available on the EDGAR Database on 
the SEC's internet site at http://www.sec.gov. Copies of this information can be
-------------------       
obtained, after paying a duplicating fee, by electronic request at the following
E-mail address: publicinfo@sec.gov, or by writing the SEC's Public Reference    
------------------                              
Section, Washington, D.C. 20549-0102.                                           

Investment Company File No. 811-8231                                            

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SPIRIT OF AMERICA VALUE FUND

 A Series of
 Spirit of America Investment Fund, Inc.

477 Jericho Turnpike
 Syosset, New York 11791

 STATEMENT OF ADDITIONAL INFORMATION

August 7, 2002

This Statement of Additional Information is not a prospectus but supplements and
should be read in conjunction with the current Prospectus for the Spirit of     
America Value Fund (the "Fund") dated August 7, 2002. No investment in shares   
should be made without first reading the Prospectus. A copy of the Prospectus   
may be obtained without charge by contacting the Fund's Distributor, SSH        
Securities, Inc. (the "Distributor"), 477 Jericho Turnpike, Syosset, New York   
11791, or calling collect 516-390-5565.                                         

The Fund is a series of Spirit of America Investment Fund, Inc. (the "Company").
The Company's most recent annual and semi-annual reports to shareholders are    
separate documents that are incorporated by reference into this Statement of    
Additional Information. The annual and semi-annual reports are also available   
without charge by calling collect 516-390-5565.                                 

 TABLE OF CONTENTS

                                                                [Download Table]

                                                                            Page
                                                                                
Fund History ..............................................................    2
Investment Strategies, Policies and Risks .................................     
Management of the Fund ....................................................     
Control Persons and Principal Holders of Securities .......................     
Investment Advisory and Other Services ....................................     
Shareholder Services ......................................................     
Retirement Plans ..........................................................     
Net Asset Value ...........................................................     
Dividends, Distributions and Taxes ........................................     
Brokerage and Portfolio Transactions ......................................     
Performance Information ...................................................     
Capital Stock .............................................................     

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FUND HISTORY

The Company, a Maryland corporation organized on May 15, 1997, is a diversified,
open-end management investment company. The Company is comprised of the Fund and
the Spirit of America Real Estate Fund (the "Spirit Fund"). The Fund offers one 
class of shares. The Fund was effective with the Securities and Exchange        
Commission on August 7, 2002 and is a diversified, open-end management          
investment company.                                                             

INVESTMENT STRATEGIES,
POLICIES AND RELATED RISKS

The following supplements the information contained in the Prospectus concerning
a description of securities and investment practices of the Fund. You should    
read it together with the section in the Prospectus entitled "Investment        
Objectives, Principal Investment Strategies, and Related Risks."                

The investment practices described below are not fundamental and may be changed 
by the Board of Directors without the approval of the Fund's shareholders.      
Shareholders will, however, be given 60 days written notification of any changes
in the investment policies. The Fund invests at least 80% of its total assets in
equity securities of companies in the value segment of the market.              

Convertible Securities                                                          
Although the Fund has no current intention of purchasing convertible securities,
the Fund may invest up to 15% of its total assets in convertible securities of  
issuers whose common stocks are eligible for purchase by the Fund. Convertible  
securities are instruments that are convertible at a stated exchange rate into  
common stock. Prior to their conversion, convertible securities have the same   
general characteristics as nonconvertible securities which provide a stable     
stream of income with generally higher yields than those of equity securities of
the same or similar issuers. The market value of convertible securities tends to
decline as interest rates increase and, conversely, to increase as interest     
rates decline.                                                                  

Convertible securities rank senior to common stocks in an issuer's capital      
structure. They are consequently of higher quality and entail less risk than the
issuer's common stock, although the extent to which such risk is reduced depends
in large measure upon the degree to which the convertible security sells above  
its value as a fixed income security.                                           

Forward Commitments, When-Issued Securities and Delayed Delivery Transactions   
Although the Fund may purchase securities on a when-issued basis, or purchase or
sell securities on a forward commitment basis, or purchase securities on a      
delayed delivery basis, the Fund does not have the current intention of doing so
in the foreseeable future. The Fund will normally realize a capital gain or loss
in connection with these transactions.                                          

No forward commitments will be made by the Fund if, as a result, the Fund's     
aggregate commitments under such transactions would be more than 15% of the then
current value of the Fund's total assets. The Fund's right to receive or deliver
a security under a forward commitment may be sold prior to the settlement date, 
but the Fund will enter into forward commitments only with                      

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the intention of actually receiving or delivering the securities, as the case   
may be. To facilitate such transactions, the Fund's custodian will maintain, in 
a segregated account of the Fund, liquid assets having value equal to, or       
greater than, any commitments to purchase securities on a forward commitment    
basis and, with respect to forward commitments to sell portfolio securities of  
the Fund, the portfolio securities themselves. If the Fund, however, chooses to 
dispose of the right to receive or deliver a security subject to a forward      
commitment prior to the settlement date of the transaction, it may incur a gain 
or loss. In the event the other party to a forward commitment transaction were  
to default, the Fund might lose the opportunity to invest money at favorable    
rates or to dispose of securities at favorable prices.                          

Standby Commitment Agreements                                                   
Although the Fund has no current intention of entering into standby commitments,
the Fund may purchase a security subject to a standby commitment agreement. The 
related commitment fee will be recorded on the date on which the security can   
reasonably be expected to be issued and the value of the security will          
thereafter be reflected in the calculation of the Fund's net asset value. The   
cost basis of the security will be adjusted by the amount of the commitment fee.
In the event the security is not issued, the commitment fee will be recorded as 
income on the expiration date of the standby commitment. The Fund will at all   
times maintain a segregated account with its custodian of liquid assets in an   
aggregate amount equal to the purchase price of the securities underlying the   
commitment.                                                                     

There can be no assurance that the securities subject to a standby commitment   
will be issued and the value of the security, if issued, on the delivery date   
may be more or less than its purchase price. Since the issuance of the security 
underlying the commitment is at the option of the issuer, the Fund will bear the
risk of capital loss in the event the value of the security declines and may not
benefit from an appreciation in the value of the security during the commitment 
period if the issuer decides not to issue and sell the security to the Fund.    

Short Sales                                                                     
The Fund may attempt to limit exposure to a possible decline in the market value
of portfolio securities through short sales of securities which Spirit of       
America Management, Inc. (the "Adviser") believes possess volatility            
characteristics similar to those being hedged. The Fund also may use short sales
in an attempt to realize gain. To effect a short sale, the Fund borrows a       
security from a brokerage firm to make delivery to the buyer. The Fund is then  
obligated to replace the borrowed security by purchasing it at the market price 
at the time of replacement. No short sale will be effected which will, at the   
time of making such short sale transaction, cause the aggregate market value of 
all securities sold short to exceed 15% of the value of the Fund's net assets.  

To secure the Fund's obligation to replace any borrowed security, it will place 
in a segregated account, an amount of cash or U.S. Government securities equal  
to the difference between the market value of the securities sold short at the  
time of the short sale, and any cash or U.S. Government securities originally   
deposited with the broker in connection with the short sale (excluding the      
proceeds of the short sale). The Fund will thereafter maintain daily the        
segregated amount at such a level that the amount deposited in it plus the      
amount originally deposited with the broker as                                  

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collateral will equal the greater of the current market value of the securities 
sold short, or the market value of the securities at the time they were sold    
short.                                                                          

A short position may be adversely affected by imperfect correlation between     
movements in the price of the security sold short and the securities being      
hedged. The Fund will realize a gain on the security sold short if the security 
declines in price between the date of the short sale and the date on which the  
Fund replaces the borrowed security. The Fund will incur a loss if the price of 
the security increases between those dates. The amount of any gain will be      
decreased, and the amount of the loss increased, by the amount of any premium or
interest the Fund may be required to pay in connection with a short sale.       

Repurchase Agreements                                                           
The Fund may enter into repurchase agreements pertaining to U.S. Government     
securities with member banks of the Federal Reserve System or primary dealers   
(as designated by the Federal Reserve Bank of New York) in such securities.     
There is no percentage restriction on the Fund's ability to enter into          
repurchase agreements. Currently, the Fund intends to enter into repurchase     
agreements only with its custodian and such primary dealers. In a repurchase    
agreement, a buyer purchases a security and simultaneously agrees to resell it  
to the vendor at an agreed-upon future date, normally one day or a few days     
later. The resale price is greater than the purchase price, reflecting an       
agreed-upon interest rate which is effective for the period of time the buyer's 
money is invested in the security and which is related to the current market    
rate rather than the coupon rate on the purchased security. This results in a   
fixed rate of return insulated from market fluctuations during such period. Such
agreements permit the Fund to keep all of its assets at work while retaining    
"overnight" flexibility in pursuit of investments of a longer-term nature. The  
Fund requires continual maintenance by its custodian for its account in the     
Federal Reserve/Treasury Book Entry System of collateral in an amount equal to, 
or in excess of, the resale price. In the event a vendor defaulted on its       
repurchase obligation, the Fund might suffer a loss to the extent that the      
proceeds from the sale of the collateral were less than the repurchase price. In
the event of a vendor's bankruptcy, the Fund might be delayed in, or prevented  
from, selling the collateral for its benefit. The Fund's Board of Directors has 
established procedures, which are periodically reviewed by the Board, pursuant  
to which the Adviser monitors the creditworthiness of the dealers with which the
Fund enters into repurchase agreement transactions.                             

Illiquid Securities                                                             
The Fund may invest up to 15% of its net assets in illiquid securities.         
Historically, illiquid securities have included securities subject to           
contractual or legal restrictions on resale because they have not been          
registered under the Securities Act of 1933, as amended (the "Securities Act"), 
securities which are otherwise not readily marketable and repurchase agreements 
having a maturity of longer than seven days. Securities which have not been     
registered under the Securities Act are referred to as private placements or    
restricted securities and are purchased directly from the issuer or in the      
secondary market. Mutual funds do not typically hold a significant amount of    
these restricted or other illiquid securities because of the potential for      
delays on resale and uncertainty in valuation. Limitations on resale may have an
adverse effect on the marketability of portfolio securities and a mutual fund   
might be unable to dispose of restricted or other illiquid securities promptly  
or at reasonable prices and might thereby experience difficulty satisfying      
redemptions within seven days.                                                  

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A mutual fund might also have to register such restricted securities in order to
dispose of them, resulting in additional expense and delay. Adverse market      
conditions could impede such a public offering of securities.                   

In recent years, however, a large institutional market has developed for certain
securities that are not registered under the Securities Act, including          
repurchase agreements, commercial paper, foreign securities, municipal          
securities and corporate bonds and notes. Institutional investors depend on an  
efficient institutional market in which the unregistered security can be readily
resold or on an issuer's ability to honor a demand for repayment. The fact that 
there are contractual or legal restrictions on resale to the general public or  
to certain institutions may not be indicative of the liquidity of such          
investments.                                                                    

The Fund may invest in restricted securities issued under Section 4(2) of the   
Securities Act, which exempts from registration transactions by an issuer not   
involving any public offering. Section 4(2) instruments are restricted in the   
sense that they can only be resold through the issuing dealer to institutional  
investors and in private transactions; they cannot be resold to the general     
public without registration.                                                    

Rule 144A under the Securities Act allows a broader institutional trading market
for securities otherwise subject to restriction on resale to the general public.
Rule 144A establishes a safe harbor from the registration requirements of the   
Securities Act for resales of certain securities to qualified institutional     
buyers. An insufficient number of qualified institutional buyers interested in  
purchasing certain restricted securities held by the Fund, however, could affect
adversely the marketability of such portfolio securities and the Fund might be  
unable to dispose of such securities promptly or at reasonable prices.          

The Adviser, under the supervision of the Board of Directors, will monitor the  
liquidity of restricted securities in the Fund's portfolio. In reaching         
liquidity decisions, the Adviser will consider, among other factors, the        
following: (1) the frequency of trades and quotes for the security; (2) the     
number of dealers making quotations to purchase or sell the security; (3) the   
number of other potential purchasers of the security; (4) the number of dealers 
undertaking to make a market in the security; (5) the nature of the security    
(including its unregistered nature) and the nature of the marketplace for the   
security (e.g., the time needed to dispose of the security, the method of       
soliciting offers and the mechanics of the transfer); and (6) any applicable    
U.S. Securities and Exchange Commission (the "Commission") interpretation or    
position with respect to such type of security.                                 

Rights and Warrants                                                             
The Fund has no current intention to invest in rights and warrants, although the
Fund may invest up to 15% of its net assets in rights or warrants only if the   
underlying equity securities are themselves deemed appropriate by the Adviser   
for inclusion in the Fund's portfolio. Rights and warrants entitle the holder to
buy equity securities at a specific price for a specific period of time. Rights 
are similar to warrants except that they have a substantially shorter duration. 
Rights and warrants may be considered more speculative than certain other types 
of equity investments in that they do not entitle a holder to dividends or      
voting rights with respect to the underlying securities nor do they represent   
any rights in the assets of the issuing company. The value of rights or warrants
does not necessarily                                                            

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change with the value of the underlying security, although the value of a right 
or warrant may decline because of a decrease in the value of the underlying     
security, the passage of time or a change in perception as to the potential of  
the underlying security, or any combination thereof. If the market price of the 
underlying security is below the exercise price set forth in the warrant on the 
expiration date, the warrant will expire worthless. Moreover, a right or warrant
ceases to have value if it is not exercised prior to the expiration date.       

Portfolio Turnover                                                              
It is the Fund's policy to sell any security whenever, in the judgment of the   
Adviser, its appreciation possibilities have been substantially realized or the 
business or market prospects for such security have deteriorated, irrespective  
of the length of time that such security has been held. [The Adviser anticipates
that the Fund's annual rate of portfolio turnover will not exceed 100%.] A 100% 
annual turnover rate would occur if all securities in the Fund's portfolio were 
replaced once within a period of one year.                                      

Temporary Investments. From time to time, the Fund may take temporary defensive 
positions that are inconsistent with its principal investment strategies. For   
temporary defensive purposes, the Fund may invest in publicly traded debt       
instruments such as government and corporate bonds or mortgage backed           
securities. The Fund will assume a temporary defensive posture only when        
economic and other factors adversely affect the equity market. When the Fund    
maintains a temporary defensive position, it may not achieve its investment     
objective.                                                                      

Fundamental Policies                                                            
In addition to the Fund's investment objective, the following fundamental       
policies may not be changed without approval by the vote of a majority of the   
Fund's outstanding voting securities, which means the affirmative vote of the   
holders of (i) 67% or more of the shares represented at a meeting at which more 
than 50% of the outstanding shares are represented, or (ii) more than 50% of the
outstanding shares, whichever is less. As a matter of fundamental policy the    
Fund may not:                                                                   

    (a)      with respect to 75% of its total assets, have such assets
                 represented by other than: (i) cash and cash items, (ii) U.S.
                Government securities, or (iii) securities of any one issuer
       (other than the U.S. Government and its agencies or
              instrumentalities) not greater than 5% of the Fund's total
           assets, and not more than 10% of the outstanding voting
securities of such issuer;                  

      (b)      invest 25% or more of its total assets in the securities of
                 issuers conducting their principal business activities in any
               one industry except that this restriction does not apply to
U.S. Government securities;                 

        (c)      purchase or sell real estate, except that it may purchase and
             sell securities of companies which deal in real estate or
               interests therein, including real estate equity securities;

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        (d)      borrow money except for temporary or emergency purposes or to
            meet redemption requests, in an amount not exceeding the
               maximum permitted by the Investment Company Act of 1940, as
amended;                                    

  (e)      pledge, hypothecate, mortgage or otherwise encumber its
  assets, except to secure permitted borrowings;

         (f)      make loans except through (a) the purchase of debt obligations
                 in accordance with its investment objectives and policies; or
(b) the use of repurchase agreements;       

(g)      issue any senior security;                           

  (h)      (i) purchase or sell commodities or commodity contracts
                 including futures contracts; (ii) invest in interests in oil,
              gas, or other mineral exploration or development programs;
        (iii) purchase securities on margin, except for such
               short-term credits as may be necessary for the clearance of
               transactions; and (iv) act as an underwriter of securities,
                except that the Fund may acquire restricted securities under
                  circumstances in which, if such securities were sold, the Fund
            might be deemed to be an underwriter for purposes of the
Securities Act.                             

MANAGEMENT OF THE FUND

Directors and Officers                                                          
The Board of Directors has responsibility for the overall management and        
operations of the Fund. The Board establishes the Fund's policies and oversees  
and reviews the management of the Fund. The Board meets regularly to review the 
activities of the officers, who are responsible for day-to-day operations of the
Fund.                                                                           

Set forth below are the Directors and executive officers of the Fund, their     
ages, business addresses, positions and terms of office, their principal        
occupations during the past five years, and other directorships held by them.   

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                                                        [Enlarge/Download Table]

                                      Term of                                              Number of                       
                                      Office/2/                                            Portfolios                      
                                      and                                                  in Fund                         
                                      Length                                               Complex      Other              
Name, Address and (Age)               of Time    Principal Occupation(s) During Past Five  Overseen     Directorships      
Position(s) with the Fund/1/          Served     Years                                     by Director  Held by Director   
-------------------------------------------------------------------------------------------------------------------------- 
                                                                                                                           
INTERESTED DIRECTORS*                                                                                                      
---------------------                                                                                                      
David Lerner(66)                      Since      President and founder, David Lerner       2            Director of        
                                      1998       Associates, Inc., a registered                         Spirit of          
Chairman of the Board of Directors               broker-dealer; President, Spirit of                    America            
                                                 America Management Corp., the Fund's                   Management         
                                                 investment adviser; and Chief Executive                Corp., the         
                                                 Officer and President of SSH                           Fund's             
                                                 Securities, Inc., the Fund's                           investment         
                                                 distributor.                                           adviser,;          
                                                                                                        Director of SSH    
                                                                                                        Securities,        
                                                                                                        Inc., the Fund's   
                                                                                                        distributor;       
                                                                                                        Director of        
                                                                                                        David Lerner       
                                                                                                        Associates,        
                                                                                                        Inc., a            
                                                                                                        registered         
                                                                                                        broker- dealer.    

Daniel Lerner (41)                    Since      Senior Vice President, Investment         2            None               
                                      1998       Counselor with David Lerner Associates,                                   
                                                 Inc., a registered broker-dealer, since                                   
Director                                         September 2000.  Previously: Broker                                       
                                                 with Prudential Securities from                                           
                                                 February 2000 to July 2000; Broker with                                   
                                                 Bear Stearns from January 1999 to May                                     
                                                 1999; Vice President of SSH Securities,                                   
                                                 Inc., the Fund's distributor and Senior                                   
                                                 Vice President, Investment Counselor                                      
                                                 and Assistant Director of Training for                                    
                                                 David Lerner Associates, Inc., from                                       
                                                 1984 to 1997.                                                             

*David Lerner is an "interested" Director, as defined in the 1940 Act, by reason of his position with the Adviser and      
Daniel Lerner is an "interested" Director by reason of his position with the Distributor. Daniel Lerner is the son of David
Lerner.                                                                                                                    

INDEPENDENT DIRECTORS                                                                                                      
---------------------                                                                                                      
Allen Kaufman (65)                    Since      President and Chief Executive Officer     2            Director of        
                                      1998       of K.G.K. Agency, Inc., a property and                 K.G.K. Agency,     
Director                                         casualty insurance agency, since 1963.                 Inc., a property   
                                                                                                        and casualty       
                                                                                                        insurance agency.  

Thomas P. Reynolds (62)               Since      President of Thomas P. Reynolds           2            Director of        
                                      1999       Securities, Ltd., a broker-dealer,                     Thomas P.          
Director                                         since 1979.                                            Reynolds           
                                                                                                        Securities,        
                                                                                                        Ltd., a            
                                                                                                        broker-dealer.     

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                                                        [Enlarge/Download Table]
                                                                                                 
Stanley S. Thune (66)         Since  President and Chief Executive Officer,  2      Director of  
                              1998   Freight Management Systems, Inc., from         Freight      
                                     January 1994 to present; President SST         Management   
Director                             Enterprises, Private Investment Firm,          Systems, Inc.
                                     since 1993.                                                 

EXECUTIVE OFFICERS                                                                               
------------------                                                                               
David Lerner                                                                                     
(see biography above)                                                                            

President and Treasurer                                                                          

Constance Ferreira (52)       Since  Chief Operating Officer, David Lerner      NA         NA    
477 Jericho Turnpike          1998   Associates, Inc., a registered                              
Syosset, New York 11791              broker-dealer; Chief Operating Officer                      
                                     of Spirit of America Management Corp.,                      
Vice President and Secretary         the Fund's investment adviser; and                          
                                     Chief Operating Officer and Chief                           
                                     Financial Officer of SSH Securities,                        
                                     Inc., the Fund's distributor.                               

/1/      If necessary, each Director may be contacted by writing to the Company,
    c/o Spirit of America Investment Fund, Inc., 477 Jericho Turnpike,
Syosset New York 11791.                                       

/2/      Each Director serves for an indefinite term, until his successor is    
elected.                                                      

Committees                                                                      
The Board has an Audit Committee, comprised of Messrs. Kaufman, Reynolds and    
Thune. The Audit Committee makes recommendations to the Board of Directors with 
respect to the engagement of independent auditors and reviews with the          
independent auditors the plan and results of the audit engagement and matters   
having a material effect on the Fund's financial operations.                    

Security and Other Interests                                                    
The following table sets forth the aggregate dollar range of equity securities  
beneficially owned by each Director in all the Funds advised by the Adviser as  
of December 31, 2001.                                                           

                                                        [Enlarge/Download Table]

                                                                                 Aggregate Dollar Range of Equity    
                                                                                 Securities in All Registered        
                                                                                 Investment Companies Overseen by    
                                                                                 Director within the Family of       
Name of Director           Dollar Range of Equity Securities in the Fund         Investment Companies                
---------------------------------------------------------------------------------------------------------------------
                                                                                                                     
David Lerner               None                                                  Over $100,000                       
Daniel Lerner              None                                                  $10,001-$50,000                     
Allen Kaufman              None                                                  None                                
Thomas Reynolds            None                                                  None                                
Stanley Thune              None                                                  None                                

With respect to the Directors who are not "interested persons" of the Fund as   
defined in the 1940 Act, as of December 31, 2001, neither they or any of their  
immediate family members owned, beneficially or of record, any securities in the
Adviser or Distributor of the Fund, or any securities in a person (other than a 
registered investment company) directly or indirectly controlling, controlled by
or under common control with the Adviser or Distributor of the Fund.            

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Compensation                                                                    
The table below sets forth the compensation paid to the Directors of the Fund   
for the fiscal year ended October 31, 2001. The Fund does not compensate the    
officers for the services they provide.                                         

                                                        [Enlarge/Download Table]

                                                   Pension or Retirement                         Total Compensation  
                                  Aggregate         Benefits Accrued as     Estimated Annual      from Company and   
                              Compensation from       Part of Company         Benefits Upon      Fund Complex Paid   
 Name of Director                    Fund                 Expenses             Retirement          to Directors*     
---------------------------------------------------------------------------------------------------------------------
                                                                                                                     
David Lerner                       $    0                    $0                    $0                  $    0        
Daniel Lerner                      $    0                    $0                    $0                  $    0        
Allen Kaufman                      $2,750**                  $0                    $0                  $2,750        
Thomas Reynolds                    $2,500**                  $0                    $0                  $2,500        
Stanley Thune                      $2,750**                  $0                    $0                  $2,750        

*        The total amount compensated to the Director for his service on the    
        Fund's Board and the Board of any other investment company in the fund
complex.                                                      

**       Compensation values are estimated because the Fund has not completed   
its first fiscal year.                                        

Code of Ethics                                                                  
The Fund, Adviser and the Distributor have adopted a Code of Ethics under Rule  
17j-1 under the Investment Company 1940 Act, as amended. The Code of Ethics     
restricts the investing activities of Fund officers and Directors and personnel 
of the Distributor and Adviser in an effort to prevent deceptive, manipulative  
or fraudulent activities in connection with securities held or to be acquired by
the Fund.                                                                       

 CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

As of August 7, 2002, the officers and Directors, as a group, owned beneficially
less than 1% of the outstanding voting shares of the Fund.                      

As of August 7, 2002, no shareholders owned of record or beneficially 5% or more
of the outstanding shares of the Fund.                                          

INVESTMENT ADVISORY AND OTHER SERVICES

The Adviser                                                                     
Mr. David Lerner is the sole shareholder, director and controlling person of the
Adviser. Mr. Lerner also is a director, chief executive officer, and president  
of the Distributor. Mr. Lerner also is a                                        

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director, chief executive officer, and president of David Lerner Associates,    
Inc., a registered broker-dealer affiliated with the Adviser and Distributor.   

The Fund employs the Adviser to manage the investment and reinvestment of the   
assets of the Fund, to determine in its discretion the assets to be held        
uninvested, to provide the Fund with records concerning the Adviser's activities
which the Fund is required to maintain, and to render regular reports to the    
Fund's officers and Board of Directors concerning the Adviser's discharge of the
foregoing responsibilities. The annual advisory fee payable by the Fund is 0.97%
of the Fund's average daily net assets. The fee is accrued daily and paid       
monthly. The Adviser has agreed to waive all or a portion of its fee and to     
reimburse certain expenses so that the total operating expenses of the Fund ,   
until February 24, 2003, would not exceed 1.97%. In subsequent years, overall   
expenses for the Fund may not fall below 1.97% until the Adviser has been fully 
reimbursed for fees forgone or expenses paid.                                   

In considering the approval of the Investment Advisory Agreement with the       
Adviser, the Board considered whether the degree of risk undertaken by the      
Adviser is consistent with shareholders' expectations and the Board's comfort   
level. The Board also considered the fairness of the Agreement. In particular,  
the Board reviewed the fee structure and the anticipated profitability of the   
Adviser relative to the services provided as well as the standard of care the   
Adviser observes in providing those services.                                   

Principal Distributor                                                           
SSH Securities, Inc. is located at 477 Jericho Turnpike, Syosset, New York      
11791. Mr. David Lerner, director, chief executive officer and president of the 
Distributor, is also the sole shareholder and director of the Fund's Adviser and
an affiliated person of the Fund and the Distributor. Mr. Daniel Lerner, an     
affiliate of the Fund is also Vice President of the Distributor.                

Distribution Plan                                                               
The Fund has adopted a Rule 12b-1 Plan with respect to its shares (the "Plan"). 

The Plan provides that the Distributor may use the 12b-1 fee paid by the Fund to
finance the distribution of Fund shares. These expenses include, among other    
things, preparing and distributing advertisements, sales literature, and        
prospectuses and reports used for sales purposes, compensating sales and        
marketing personnel, holding special promotions for specified periods of time,  
and paying distribution and maintenance fees to brokers, dealers and others.    

The Plan provides that the Distributor will use the distribution fees received  
from the Fund in their entirety for payments (i) to compensate broker-dealers or
other persons for providing distribution assistance, (ii) to otherwise promote  
the sale of shares of the Fund, and (iii) to compensate broker-dealers,         
depository institutions and other financial intermediaries for providing        
administrative, accounting and other services with respect to the Fund's        
shareholders. Distribution fees received from the Fund will not be used to pay  
any interest expenses, carrying charges or other financing costs or allocation  
of overhead of the Distributor. The Plan also provides that the Distributor may 
use its own resources to finance the distribution of the Fund's shares.         

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The Plan is characterized as a compensation plan because the distribution and   
service fees will be paid to the Distributor without regard to the distribution 
or shareholder services expenses incurred by the Distributor or the amount of   
payments made to financial institutions and intermediaries.                     

The Fund is not obligated under the Plan to pay any distribution services fee in
excess of an annual rate of 0.30% of the Fund's average net assets. All expenses
of distribution and marketing in excess of the maximum amounts permitted by the 
Plan per annum will be borne by the Distributor and any amounts paid for the    
above services will be paid pursuant to a servicing or other agreement.         

Distribution expenses accrued by the Distributor in one fiscal year may not be  
paid from distribution services fees received from the Fund in subsequent fiscal
years. The Fund intends to operate the Plan in accordance with its terms and in 
accordance with the rules of the NASD concerning sales charges.                 

The fees paid to the Distributor under the Plan are subject to annual review and
approval by the Fund's independent Directors who have the authority to reduce   
the fees or terminate the Plan at any time. All payments to the Plan shall be   
made for the purpose of selling shares issued by the Fund or servicing          
shareholder accounts.                                                           

Under the Plan, the Distributor reports the amounts expended under the Plan and 
the purposes for which such expenditures were made, to the Directors of the Fund
for their review on a quarterly basis. Also, the Plan provides that the         
selection and nomination of Directors who are not interested persons of the     
Fund, as defined in the 1940 Act, are committed to the discretion of such       
disinterested Directors then in office.                                         

The Adviser may from time to time make payments for distribution services to the
Distributor from its own funds or such other resources as may be permitted by   
rules of the Securities and Exchange Commission (the "Commission"). The         
Distributor may in turn pay part or all of such compensation to brokers or other
persons for their distribution assistance.                                      

In the event that the Plan is terminated or not continued (i) no distribution   
fees (other than current amounts accrued but not yet paid) would be owed by the 
Fund to the Distributor.                                                        

Mr. David Lerner is a director, the chief executive officer and president of the
Distributor. Mr. Lerner is also a director, the chief executive officer and     
president of David Lerner Associates, Inc., a registered broker-dealer          
affiliated with the Adviser and the Distributor and he is an interested person  
of the Fund. Mr, Daniel Lerner, Vice President of the Distributor in as         
interested person of the Fund.                                                  

Administrative Services Agent and Fund Accountant                               
PFPC Inc. ("PFPC"), a wholly-owned subsidiary of PNC Bank Corp., which is       
located at 3200 Horizon Drive, King of Prussia, PA 19406, provides the back     
office services for the Fund. The services include the day-to-day administration
of matters necessary to the Fund's operations, maintenance of records and books,
preparation of reports and compliance monitoring.                               

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PFPC also serves as the accounting agent for the Fund and maintains the         
accounting books and records of the Fund, calculates the Fund's net asset value 
in accordance with the provisions of the Fund's current Prospectus and prepares 
for Fund approval and use various government reports, tax returns, and proxy    
materials.                                                                      

Transfer Agent                                                                  
PFPC serves as the Fund's transfer agent and maintains the records of each      
shareholder's account, answers shareholder inquiries, processes purchases and   
redemptions and acts as dividend disbursing agent.                              

Custodian and Custody Administrator                                             
PFPC Trust Company, 8800 Tinicum Boulevard, 3rd Floor, Philadelphia, PA 19153,  
is custodian of the Fund's assets pursuant to a custodian agreement. Under the  
custodian agreement, PFPC Trust Company (i) maintains a separate account or     
accounts in the name of the Fund (ii) holds and transfers portfolio securities  
on account of the Fund, (iii) accepts receipts and make disbursements of money  
on behalf of the Fund, (iv) collects and receives all income and other payments 
and distributions on account of the Fund's securities and (v) makes periodic    
reports to the Directors concerning the Fund's operations.                      

Independent Auditors                                                            
________________(_______) 8 Penn Center Plaza, Suite 800, Philadelphia, PA      
19103, serves as independent auditor for the Fund. The financial statements of  
the Company, as of October 31, 2001, incorporated by reference into the         
Prospectus and in this SAI, have been audited by ___________.                   

Shareholder Reports and Inquiries                                               
The Fund issues unaudited financial information semi-annually and audited       
financial statements annually. Shareholder inquires should be addressed to the  
Fund c/o PFPC Inc., 211 South Gulph Rd., P.O. Box 61767, King of Prussia, PA    
19406. Purchase and redemption transactions should be made through PFPC by      
calling (800) 452-4892.                                                         

SHAREHOLDER SERVICES

The following information supplements that set forth in the Fund's Prospectus   
under the heading "How to Purchase Shares."                                     

Automatic Investment Plan                                                       
Investors may purchase shares of the Fund through an automatic investment       
program utilizing electronic funds transfers drawn on the investor's own bank   
account. Under such a program, pre-authorized monthly drafts for a fixed amount 
(at least $50) are used to purchase shares through the selected dealer or       
selected agent designated by the investor at the public offering price next     
determined after the distributor receives the proceeds from the investor's bank.
In electronic form,                                                             

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drafts can be made on or about a date each month selected by the shareholder.   
Investors wishing to establish an automatic investment program in connection    
with their initial investment should complete the appropriate portion of the    
account application found in the Prospectus. Current shareholders should contact
the Distributor at the address or telephone numbers shown on the cover of this  
Statement of Additional Information to establish an automatic investment        
program.                                                                        

Systematic Withdrawal Plan                                                      
Any shareholder who owns or purchases shares of the Fund having a current net   
asset value of at least $10,000 may establish a systematic withdrawal plan under
which the shareholder will receive payments from his or her account on a regular
basis. Systematic withdrawal plan participants must elect to have their         
dividends and distributions from the Fund automatically reinvested in additional
shares of the Fund.                                                             

Shares of the Fund owned by a participant in the Fund's systematic withdrawal   
plan will be redeemed as necessary to meet withdrawal payments and such         
withdrawal payments will be subject to any taxes applicable to redemptions.     
Shares acquired with reinvested dividends and distributions will be liquidated  
first to provide such withdrawal payments and thereafter other shares will be   
liquidated to the extent necessary. A systematic withdrawal plan may be         
terminated at any time by the shareholder or the Fund.                          

Withdrawal payments will not automatically end when a shareholder's account     
reaches a certain minimum level. Therefore, redemptions of shares under the plan
may reduce or even liquidate a shareholder's account and may subject the        
shareholder to the Fund's involuntary redemption provisions.                    

RETIREMENT PLANS

The Fund may be a suitable investment vehicle for part or all of the assets held
in various types of retirement plans, such as those listed below. The Fund has  
available forms of such plans pursuant to which investments can be made in the  
Fund. Persons desiring information concerning these plans should contact SSH    
Securities, Inc. at (516) 390-5565, or write to:                                

SSH Securities, Inc.
477 Jericho Turnpike
 Syosset, New York 11791

Traditional Individual Retirement Account ("IRA"). Individuals who receive      
compensation, including earnings from self-employment, may be entitled to       
establish and make contributions to an IRA. Taxation of the income and gains    
paid to an IRA by the Fund is deferred until distribution from the IRA.         

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Roth IRAs. The Taxpayers Relief Act of 1997 created the new Roth IRA. While     
contributions to a Roth IRA are not currently deductible, the amounts invested  
in a Roth account accumulate tax-free and qualified distributions will not be   
included in a shareholder's taxable income. The contribution limit is $2000     
annually ($4,000 for joint returns) in aggregate with contributions to          
Traditional IRAs. Certain income phaseouts apply.                               

Education IRAs. The Taxpayers Relief Act of 1997 also created the new Education 
IRA. Like the Roth IRA, contributions are non-deductible, but the investment    
earnings accumulate tax-free, and distributions used for higher education       
expenses are not taxable. Contribution limits are $500 per account and certain  
income phaseouts apply.                                                         

Employer-Sponsored Qualified Retirement Plans. Sole proprietors, partnerships   
and corporations may sponsor qualified money purchase pension and profit-sharing
plans, including Section 401(k) plans ("qualified plans"), under which annual   
tax-deductible contributions are made within prescribed limits based on         
compensation paid to participating individuals.                                 

Simplified Employee Pension Plan ("SEP"). Sole proprietors, partnerships and    
corporations may sponsor a SEP under which they make annual tax-deductible      
contributions to an IRA established by each eligible employee within prescribed 
limits based on employee compensation.                                          

403(b)(7) Retirement Plan. Certain tax-exempt organizations and public          
educational institutions may sponsor retirement plans under which an employee   
may agree that monies deducted from his or her compensation (minimum $25 per pay
period) may be contributed by the employer to a custodial account established   
for the employee under the plan.                                                

Distributions from retirement plans are subject to certain Internal Revenue Code
of 1986 (the "Code") requirements in addition to normal redemption procedures.  
For additional information please contact the Distributor.                      

Statements and Reports. Each shareholder of the Fund receives semi-annual and   
annual reports which include a portfolio of investments, financial statements   
and, in the case of the annual report, the report of the Fund's independent     
auditors, as well as confirmation of each purchase and redemption. By contacting
his or her broker, a shareholder can arrange for copies of his or her account   
statements to be sent to another person.                                        

 NET ASSET VALUE

The net asset value ("NAV") per share for the Fund is computed by adding the    
value of the Fund's investments, cash and other assets attributable to the Fund,
deducting liabilities of the Fund and dividing the result by the number of      
shares outstanding. The public offering price is the Fund's NAV plus the        
applicable sales charge.                                                        

Portfolio securities are valued and NAV per share is calculated as of the close 
of regular trading on the New York Stock Exchange ("NYSE"), currently 4:00 p.m. 
(Eastern Time), on each day the NYSE is open for trading.                       

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The Fund's equity securities are valued based on the last reported sales price  
on the principal exchange on which the security trades, or if no sales price is 
reported, the mean of the latest bid and asked prices is used. Securities traded
over-the-counter are priced at the mean of the latest bid and asked prices.     

Short-term investments having a maturity of 60 days or less are valued at       
amortized cost, which the Board of Directors believes represents fair value.    
When a security is valued at amortized cost, it is valued at its cost when      
purchased, and thereafter by assuming a constant amortization to maturity of any
discount or premium, regardless of the impact of fluctuating interest rates on  
the market value of the instrument. All other securities and other assets are   
valued at their fair value as determined in good faith under procedures         
established by and under the supervision of the Board of Directors.             

DIVIDENDS, DISTRIBUTIONS AND TAXES

Federal Income Taxes                                                            
The Fund intends to elect and qualify as a "regulated investment company" under 
Sub-Chapter M of the Code. To so qualify, the Fund must, among other things, (i)
derive at least 90% of its gross income in each taxable year from dividends,    
interest, payments with respect to securities loans, gains from sale or other   
disposition of stock or securities or foreign currency, or certain other income 
(including, but not limited to, gains from options, futures and forward         
contracts) derived with respect to its business of investing in stock,          
securities or currency; (ii) diversify its holdings so that, at the end of each 
quarter of its taxable year, the following two conditions are met: (a) at least 
50% of the value of the Fund's assets is represented by cash, U.S. Government   
Securities, securities of other regulated investment companies and other        
securities with respect to which the Fund's investment is limited, in respect of
any one issuer, to an amount not greater than 5% of the Fund's assets and 10% of
the outstanding voting securities of such issuer, and (b) not more than 25% of  
the value of the Fund's assets is invested in securities of any one issuer      
(other than U.S. Government Securities or securities of other regulated         
investment companies).                                                          

If the Fund qualifies as a regulated investment company for any taxable year and
makes timely distributions to its shareholders of 90% or more of its net        
investment income for that year (calculated without regard to its net capital   
gain, i.e., the excess of its net long-term capital gain over its net short-term
capital loss), it will not be subject to federal income tax on the portion of   
its taxable income for the year (including any net capital gain) that it        
distributes to shareholders.                                                    

The Fund intends to also avoid the 4% federal excise tax that would otherwise   
apply to certain undistributed income for a given calendar year if it makes     
timely distributions to the shareholders equal to the sum of (i) 98% of its     
ordinary income for that year; (ii) 98% of its capital gain net income and      
foreign currency gains for the twelve month period ending on October 31 of that 
year; and (iii) any ordinary income or capital gain net income from the         
preceding calendar year that was not distributed during that year. For this     
purpose, income and gain retained by the Fund that is subject to corporate      
income tax will be considered to have been distributed by the Fund by year-end. 
For federal income and excise tax purposes, dividends declared and payable to   
shareholders of record as of a date in October, November or December of a given 
year but actually paid during the                                               

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immediately following January will be treated as if paid by the fund on December
31 of that calendar year, and will be taxable to these shareholders for the year
declared, and not for the year in which the shareholders actually receive the   
dividend.                                                                       

Dividends and Distributions                                                     
The Fund intends to make timely distributions of the Fund's taxable income      
(including any net capital gain) so that the Fund will not be subject to federal
income and excise taxes. The excess of net capital gains over the net capital   
losses realized and distributed by the Fund to its shareholders is expected to  
be taxable to the shareholders as long-term capital gains, regardless of the    
length of time a shareholder may have held his Fund shares. Dividends of the    
Fund's net ordinary income and distributions of any net realized short-term     
capital gain are taxable to shareholders as ordinary income. Due to             
distributions of amounts representing a return of capital the Fund will receive 
from securities in which the Fund is invested, distributions made by the Fund   
may also include nontaxable returns of capital, which will reduce a             
shareholder's basis in shares of the Fund. If a shareholder's basis is reduced  
to zero (which could happen if a shareholder does not reinvest distributions and
returns of capital are significant), any further returns of capital will be     
taxable as a capital gain. Any dividend or distribution received by a           
shareholder on shares of the Fund will have the effect of reducing the net asset
value of such shares by the amount of such dividend or distribution.            
Furthermore, a dividend or distribution made shortly after the purchase of such 
shares by a shareholder, although in effect a return of capital to that         
particular shareholder, would be taxable in the manner discussed regardless of  
whether they are paid to the shareholder in cash or reinvested in additional    
shares of the Fund.                                                             

After the end of the taxable year, the Fund will notify shareholders of the     
federal income tax status of any distributions made by the Fund to shareholders 
during such year.                                                               

It is the present policy of the Fund to distribute to shareholders all net      
investment income quarterly and to distribute realized capital gains, if any,   
annually. There can be no assurance that the Fund will pay any dividends. The   
amount of any dividend or distribution paid on shares of the Fund must          
necessarily depend upon the realization of income and capital gains from the    
Fund's investments.                                                             

Sales and Redemptions                                                           
Any gain or loss arising from a sale or redemption of Fund shares generally will
be capital gain or loss except in the case of a dealer or a financial           
institution, and will be long-term capital gain or loss if such shareholder has 
held such shares for more than one year at the time of the sale or redemption;  
otherwise it will be short-term capital gain or loss. However, if a shareholder 
has held shares in the Fund for six months or less and during that period has   
received a distribution taxable to the shareholder as a long-term capital gain, 
any loss recognized by the shareholder on the sale of those shares during the   
six-month period will be treated as a long-term capital loss to the extent of   
the dividend. In determining the holding period of such shares for this purpose,
any period during which a shareholder's risk of loss is offset by means of      
options, short sales or similar transactions is not counted.                    

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Backup Withholding                                                              

The Fund may be required to withhold U.S. federal income tax at the rate of 30% 
of all taxable distributions payable to shareholders who fail to provide the    
Fund with their correct taxpayer identification numbers or to make required     
certifications, or who have been notified by the Internal Revenue Service that  
they are subject to backup withholding. Corporate shareholders and certain other
shareholders specified in the Code are exempt from such backup withholding.     
Backup withholding is not an additional tax; any amounts so withheld may be     
credited against a U.S. shareholder's U.S. federal income tax liability or      
refunded.                                                                       

BROKERAGE AND PORTFOLIO TRANSACTIONS

The Adviser has the responsibility for allocating its brokerage orders and may  
direct orders to any broker including to David Lerner Associates, Inc., an      
affiliated person of the Fund, Adviser and the Distributor. It is the Fund's    
general policy to seek favorable net prices and prompt reliable execution in    
connection with the purchase or sale of all portfolio securities. In the        
purchase and sale of over-the-counter securities, it is the Fund's policy to use
the primary market makers except when a better price can be obtained by using a 
broker. The Board of Directors has approved, as in the best interests of the    
Fund and the shareholders, a policy of considering, among other factors, sales  
of the Fund's shares as a factor in selection of broker-dealers to execute      
portfolio transactions, subject to best execution. The Adviser is authorized to 
place brokerage business with such brokers and dealers. The use of brokers who  
supply supplemental research and analysis and other services may result in the  
payment of higher commissions than those available from other brokers and       
dealers who provide only the execution of portfolio transactions. In addition,  
the supplemental research and analysis and other services that may be obtained  
from brokers and dealers through which brokerage transactions are affected may  
be useful to the Adviser in connection with advisory clients other than the     
Fund.                                                                           

Investment decisions for the Fund are expected to be made independently from    
those for other advisory accounts managed by the Adviser. It may happen, on     
occasion, that the same security is held in the portfolio of the Fund and one or
more of such accounts. Simultaneous transactions are likely when several        
accounts are managed by the same adviser, particularly when a security is       
suitable for the investment objectives of more than one of such accounts. If two
or more accounts managed by the adviser are simultaneously engaged in the       
purchase or sale of the same security, the transactions will be allocated to the
respective accounts both as to amount and price, in accordance with a method    
deemed equitable to each account. In some cases this system may adversely affect
the price paid or received by the Fund or the size of the position obtainable   
for the Fund.                                                                   

Allocations are made by the officers of the Fund or of the Adviser. Purchases   
and sales of portfolio securities are determined by the Adviser and are placed  
with broker-dealers by the Adviser.                                             

The extent to which commissions that will be charged by broker-dealers selected 
by the Fund may reflect an element of value for research that cannot presently  
be determined. To the extent that research services of value are provided by    
broker-dealers with or through whom the Fund places portfolio transactions, the 
Adviser may be relieved of expenses which it might otherwise bear. Research     
services furnished by broker-dealers could be useful and of value to the Adviser
in                                                                              

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servicing its other clients as well as the Fund. Consistent with the Conduct    
Rules of the National Association of Securities Dealers, Inc. and subject to    
seeking best execution, the Fund may consider sales of shares of the Fund as a  
factor in the selection of brokers to execute portfolio transactions for the    
Fund. It is anticipated that the amount of commissions paid to David Lerner     
Associates during each fiscal year will represent 100% of the Fund's aggregate  
brokerage commissions and 100% of the Fund's total portfolio transactions.      

 PERFORMANCE INFORMATION

General                                                                         

From time to time, advertisements quoting performance rankings of the Fund as   
measured by financial publications or by independent organizations such as      
Lipper Analytical Services, Inc. and Morningstar, Inc., and advertisements      
presenting the historical record of payments of income dividends by the Fund may
be sent to investors or placed in newspapers and/or magazines such as The Wall  
Street Journal, The New York Times, Barrons, Investor's Daily, Money Magazine,  
Changing Times, Business Week and Forbes or other media on behalf of the Fund.  

Total return may be used to compare the performance of the Fund against certain 
widely acknowledged standards or indices for stock and bond market performance  
including but not limited to the Standard & Poor's 500 Composite Index and the  
Dow Jones Industrial Average.                                                   

Average Annual Total Return                                                     

From time to time the Fund may advertise its total return for prior periods. The
Fund's total return is its average annual compounded total return for its most  
recently completed one, five, and ten-year periods (or the period since the     
Fund's inception). The Fund's total return for such a period is computed by     
finding, through the use of a formula prescribed by the Commission below, the   
average annual compounded rate of return over the period that would equate an   
assumed initial amount invested to the value of such investment at the end of   
the period. For purposes of computing total return, income dividends and capital
gains distributions paid on shares of the Fund are assumed to have been         
reinvested when paid and the maximum sales charge applicable to purchase of Fund
shares is assumed to have been paid. This calculation can be expressed as       
follows:                                                                        

 P(1 + T)/n/ = ERV

Where:                                                                          

ERV=             ending redeemable value at the end of the period covered by the
          computation of a hypothetical $1,000 payment made at the
beginning of the period                       

P =              hypothetical initial investment of $1,000                      

n =              period covered by the computation, expressed in terms of years.

T =              average annual total return                                    

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These calculations will reflect the deduction of the maximum sales charges and  
annual fund operating expenses.                                                 

Average Annual Total Return After Taxes on Distributions                        

Quotations of average annual total return after taxes on distributions will be  
expressed in terms of the average annual total return (after taxes on           
distributions) by finding the average annual compounded rates of return of a    
hypothetical investment in the Fund over periods of 1, 5 and 10 years and since 
inception (up to the life of the Fund), that would equate the initial amount    
invested to the ending value, according to the following formula:               

 P (1 + T)/n/ = ATVD

(where P = a hypothetical initial payment of $l,000, T = the average annual     
total return (after taxes on distributions), n = the number of years, and       
ATV\\D\\ = the ending value of a hypothetical $1,000 payment made at the        
beginning of the 1, 5, or 10 year periods at the end of the 1, 5, or 10 year    
period (or fractional portion)), after taxes on Fund distributions but not after
taxes on redemption.                                                            

Average Annual Total Return After Taxes on Distributions and Redemption         

Quotations of average annual total return after taxes on distributions and      
redemption will be expressed in terms of the average annual total return (after 
taxes on distributions and redemption) by finding the average annual compounded 
rates of return of a hypothetical investment in the Fund over periods of 1, 5   
and 10 years and since inception (up to the life of the Fund), that would equate
the initial amount invested to the ending value, according to the following     
formula:                                                                        

P (1 + T)n = ATV\\DR\\

(where P = a hypothetical initial payment of $l,000, T = the average annual     
total return (after taxes on distributions and redemption), n = the number of   
years, and ATV\\DR\\ = the ending value of a hypothetical $1,000 payment made at
the beginning of the 1, 5, or 10 year periods at the end of the 1, 5, or 10 year
periods (or fractional portion)), after taxes on Fund distributions and         
redemption.                                                                     

Cumulative Total Return                                                         

The Fund may also quote the cumulative total return in addition to the average  
annual total return. These quotations are computed the same way, except the     
cumulative total return will be based on the actual return for a specified      
period rather than on the average return over one, five and ten year periods, or
fractional portion thereof.                                                     

 CAPITAL STOCK

The Company currently has two series: the Fund and Spirit of America Real Estate
Fund. The authorized capital stock of the Fund currently consists of 500 million
shares of Common Stock each having a par value of $.001 per share. Under        
Maryland law, the Fund's Directors may increase the number of authorized shares 
without shareholder approval. The Fund currently offers one class of shares. All
shares of the Fund, when issued, are fully paid and non-assessable. Each issued 
and                                                                             

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outstanding share of common stock is entitled to one vote on matters            
submitted to a vote of shareholders. A shareholder in the Fund will be entitled 
to his or her share pro rata share with other holders of shares of all dividends
and distributions arising from the Fund's assets and, upon redeeming shares,    
will receive the then current net asset value of the Fund represented by the    
redeemed shares.                                                                

Under Maryland law, the Fund is not required, and does not intend to hold annual
meetings of shareholders unless, under certain circumstances, it is required to 
do so under the 1940 Act. Shareholders of 10% or more of the Fund's outstanding 
shares may request that a special meeting be called to consider the removal of  
any Directors. The Fund will assist in the communication with other             
shareholders.                                                                   

The Directors are authorized to reclassify and issue any unissued shares to any 
number of additional series and classes without shareholder approval.           
Accordingly, the Directors in the future, for reasons such as the desire to     
establish one or more additional series with different investment objectives,   
policies or restrictions, may create additional classes or series of shares. Any
issuance of shares of another class or series would be governed by the 1940 Act 
and the laws of the State of Maryland. Generally, shares of both series would   
vote as a single series on matters, such as the election of Directors, that     
affected both portfolios in substantially the same manner. As to matters        
affecting each series differently, such as approval of an advisory agreement and
changes in investment policy, shares of each series vote separately. Procedures 
for calling a shareholders' meeting for the removal of Directors of the Fund,   
similar to those set forth in Section 16(c) of the 1940 Act, will be available  
to shareholders of the Fund.                                                    

Shares are freely transferable, are entitled to dividends as determined by the  
Directors, and, in liquidation of the Fund, are entitled to receive the net     
assets of the Fund. There are no conversion rights.                             

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 SPIRIT OF AMERICA INVESTMENT FUND, INC.

 Form N-1A

 Part C -- Other Information

Part C.  Other Information                                                      

Item 23. Exhibits                                                               

        (a)  (i)       Articles of Incorporation are incorporated by reference
                      to Registrant's Initial Registration Statement on Form
               N-1A, File number 333-27925 filed May 28, 1997.

      (ii)      Articles Supplementary dated February 26, 2001 -
      ----------------------------------------------------------
                     incorporated by reference to Post-Effective Amendment
                     -----------------------------------------------------
No. 5, filed February 28, 2002. 
------------------------------- 

              (iii)     Articles Supplementary dated June 12, 2002 - to be filed
              ------------------------------------------------------------------
by amendment.                   
-------------                   

    (b)  By-Laws are incorporated by reference to Registrant's Initial
            Registration Statement on Form N-1A, File number 333-27925 filed
May 28, 1997.                                       

(c)  All Instruments Defining the Rights of Holders.          

             (i)       Articles of Incorporation are incorporated by reference
                     to Registrants Initial Registration Statement on Form
               N-1A, File number 333-27925 filed May 28, 1997.

     (iii)     Articles Supplementary dated February 26, 2001-
     ---------------------------------------------------------
                     incorporated by reference to Post-Effective Amendment
                     -----------------------------------------------------
No. 5, filed February 28, 2002. 
------------------------------- 

              (iii)     Articles Supplementary dated June 12, 2002 - to be filed
              ------------------------------------------------------------------
by amendment.                   
-------------                   

           (iv)      By-Laws are incorporated by reference to Registrant's
                        Initial Registration Statement on Form N-1A, File number
333-27925 filed May 28, 1997.   

     (d)  Investment Advisory Contracts -- Investment Advisory Agreement
            between Spirit of America Management Corp. and the Registrant is
             incorporated by reference to Registrant's Pre-Effective Amendment
No.1 filed December 18, 1997.                       

          (i)       Investment Advisory Contracts - Form of Amendment to
          --------------------------------------------------------------
                       Investment Advisory Agreement between Spirit of America
                       -------------------------------------------------------
                  Management Corp. and the Registrant to be filed by
                  --------------------------------------------------
amendment.                      
----------                      

  (e)  Underwriting Agreement --Underwriting Agreement between SSH
            Securities, Inc. and the Registrant is incorporated by reference
            to Registrant's Pre-Effective Amendment No. 1 filed December 18,
1997.                                               

   (i)       Underwriting Agreement - Form of Amendment to
   -------------------------------------------------------
                       Underwriting Agreement between SSH Securities, Inc. and
                       -------------------------------------------------------
        the Registrant to be filed by amendment.
        ----------------------------------------

      (f)  Bonus, Profit Sharing, Pension or Other Similar Contracts - Not
Applicable                                          

    (g)  Custody Agreement between PFPC Trust Company and Registrant -
    ------------------------------------------------------------------
filed herewith.                                     
---------------                                     

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(h)   Other Material Contracts                                            

      (i)      Investment Company Services Agreement -- Investment Company
      Services Agreement is incorporated by reference to
                Registrant's Pre-Effective Amendment No.1 filed December 18,
1997.                                       

         (ii)     Investment Company Services Agreement  -- Form of Amendment to
                  --------------------------------------------------------------
         Investment Company  Services Agreement to be filed by
         -----------------------------------------------------
amendment.                                  
----------                                  

(i)   Opinion and Consent of Counsel - to be filed by amendment.          
----------------------------------------------------------------          

(j)   Other Opinions, Appraisals or Rulings                               

(i)      Consent of Independent Auditors - not applicable.    
----------------------------------------------------------    

(k)   All Financial Statements omitted from Item 22 - not applicable      

(l)   Agreements or Understandings Made in Consideration for Providing the
 Initial Capital -- is incorporated by reference to Registrant's
Pre-Effective Amendment No.2 filed December 31, 1997.         

(m)   Plan of Distribution pursuant to Rule 12b-1                         

 (i)   Distribution Plan - Spirit of America Fund Class A Shares
          incorporated by reference to Post-Effective Amendment No. 1,
filed on February 5, 1998.                        

 (ii)  Distribution Plan - Spirit of America Fund Class B Shares
          incorporated by reference to Post-Effective Amendment No. 1,
filed on February 5, 1998.                        

       (iii) Distribution Plan - Spirit of America Value Fund to be filed by
       ---------------------------------------------------------------------
amendment.                                        
----------                                        

(n)   18f-3 Plan with respect to Multiple Class Shares - incorporated by  
         reference to Post-Effective Amendment No. 1, filed on February 5, 1998.

(p)   Code of Ethics of Spirit of America Investment Fund. Inc., Spirit of
       America Management Co. and SSH Securities - incorporated by reference
to Post-Effective Amendment No. 4, filed on February 28, 2001.

Item 24. Persons Controlled by or Under Common Control with Registrant - None.  

Item 25. Indemnification.                                                       

It is the Registrant's policy to indemnify its directors and officers,    
 employees and other agents to the maximum extent permitted by Section 2-418
of the General Corporation Law of the State of Maryland, which is         
incorporated by reference herein, and as set forth in Article EIGHT of    
Registrant's Articles of Incorporation, incorporated by reference in      
connection with Exhibit 1 hereto, Article VII and Article VIII of         
  Registrant's By-Laws, incorporated by reference in connection with Exhibit 2
hereto. The Adviser's liability for any loss suffered by the Registrant or
its shareholders is set forth in Section 4 of the proposed Advisory       
Agreement, incorporated by reference in connection with Exhibit 5 hereto. 

 Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the    
Registrant pursuant to the foregoing provisions, or                       

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        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 Securities 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 of whether such
        indemnification by it is against public policy as expressed in the
           Securities Act and will be governed by the final adjudication of such
issue.                                                    

      In accordance with Release No. IC-11330 (September 2, 1980), the
           Registrant will indemnify its directors, officers, investment manager
           and principal underwriters only if (1) a final decision on the merits
          was issued by the court or other body before whom the proceeding was
          brought that the person to be indemnified (the "indemnitee") was not
          liable by reason of willful misfeasance, bad faith, gross negligence
        or reckless disregard of the duties involved in the conduct of his
       office ("disabling conduct") or (2) a reasonable determination is
         made, based upon a review of the facts, that the indemnitee was not
          liable by reason of disabling conduct, by (a) the vote of a majority
          of a quorum of the directors who are neither "interested persons" of
     the Registrant as defined in section 2(a)(19) of the Investment
    Company Act of 1940, as amended, nor parties to the proceeding
         ("disinterested, non-party directors"), or (b) an independent legal
         counsel in a written opinion. The Registrant will advance attorneys
 fees or other expenses incurred by its directors, officers,
 investment adviser or principal underwriters in defending a
           proceeding, upon the undertaking by or on behalf of the indemnitee to
     repay the advance unless it is ultimately determined that he is
         entitled to indemnification and, as a condition to the advance, (1)
          the indemnitee shall provide a security for his undertaking, (2) the
         Registrant shall be insured against losses arising by reason of any
      lawful advances, or (3) a majority of a quorum of disinterested,
    non-party directors of the Registrant, or an independent legal
         counsel in a written opinion, shall determine, based on a review of
        readily available facts (as opposed to a full trial-type inquiry),
         that there is reason to believe that the indemnitee ultimately will
be found entitled to indemnification.                     

Item 26.   Business and Other Connections of Investment Adviser.                

      Since the date of its incorporation on April 24, 1997, Spirit of
         America Management Corp. has not been engaged in any other business
 other than acting as adviser to Registrant. During the past
    twenty-four years, David Lerner, a director and officer of the
        Adviser, has served as the Chief Executive Officer and Director of
          David Lerner Associates, Inc. The business address of the company is
477 Jericho Turnpike, Syosset, New York 11791.            

           For information as to any other business, vocation or employment of a
 substantial nature in which each Director or officer of the
          Registrant's investment adviser has been engaged for his own account
   or in the capacity of Director, officer, employee, or partner
          reference is made to Form ADV (File #801-54782) filed by the Adviser
under the Investment Advisers Act of 1940, as amended.    

Item 27.   Principal Underwriter.                                               

         (a)    SSH Securities, Inc., the Registrant's distributor, does not
                 act as principal underwriter, depositor or investment adviser
for any other investment company.           

           (b)    The table below sets forth certain information with respect to
                each director, officer and control person of SSH Securities,
Inc.                                        

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                                                        [Enlarge/Download Table]


          Name and Principal          Position and Offices               Position and Offices      
           Business Address             With Underwriter                    With Registrant        
           ----------------             ----------------                    ----------------       
                                                                                                   
David Lerner                  Director, Chief Executive Officer    Chairman of the Board, Director,
477 Jericho Turnpike          and President                        President and Treasurer         
Syosset, NY  11791                                                                                 

Constance Ferreira            Vice President, Chief Operating      Vice President and Secretary    
477 Jericho Turnpike          Officer and Chief Financial Officer                                  
Syosset, NY  11791                                                                                 

Daniel E. Chafetz             Chief Compliance Officer             Compliance Officer              
477 Jericho Turnpike                                                                               
Syosset, NY  11791                                                                                 

(c)      Not Applicable.                                      

Item 28. Location of Accounts and Records.                                      

         All records described in Section 31(a) of the 1940 Act and the Rules 17
      CFR 270.31a-1 to 31a-3 promulgated thereunder, are maintained by the
    Fund's Investment Adviser, Spirit of America Management, Inc., 477
        Jericho Turnpike, Syosset, New York 11791, except for those maintained
    by the Fund's Custodian, The Bank of New York, 48 Wall Street, New
       York, New York 10172 and the Fund's Administrator, Transfer Agent and
         Fund Accounting Services Agent, PFPC Inc., 3200 Horizon Drive, P.O. Box
61503, King of Prussia, PA 19406-0903.                        

Item 29. Management Services.                                                   

None.                                                         

Item 30. Undertakings.                                                          

Not Applicable.                                               

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SIGNATURES

     Pursuant to the requirements of the Investment Company Act of 1940,
as amended, the Registrant has duly caused this Registration Statement to be    
signed on its behalf by the undersigned, thereunto duly authorized, in the City 
of Syosset, and State of New York on the 24th day of May, 2002.                 

                                         Spirit of America Investment Fund, Inc.
                                Registrant

                      By: /s/ David Lerner
                                        ------------------------------
                                         David Lerner, President

         Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons in   
the capacities and on the date indicated.                                       

Signature                           Capacity                        Date        
---------                           --------                        ----        

/s/ David Lerner                    Chairman of the Board           May 24, 2002
---------------------------                                                     
David Lerner                        President & Director                        

/s/ Thomas P. Reynolds*             Director                        May 24, 2002
---------------------------                                                     
Thomas P. Reynolds                                                              

/s/ Allen Kaufman*                  Director                        May 24, 2002
---------------------------                                                     
Allen Kaufman                                                                   

/s/ Daniel Lerner*                  Director                        May 24, 2002
---------------------------                                                     
Daniel Lerner                                                                   

/s/ Constance Ferreira              Principal Financial and         May 24, 2002
---------------------------                                                     
Constance Ferreira                  Accounting Officer                          

/s/ Stanley Thune*                  Director                        May 24, 2002
---------------------------                                                     
Stanley Thune                                                                   

By: /s/ Thomas N. Calabria                                                      
---------------------------                                                     
*Attorney-in-Fact                                                               

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The Spirit of America Investment Fund, Inc.                                     

Index to Exhibits to Form N-1A
 -------------------------------

Exhibit No.                                                                     
----------                                                                      
23(g)                Custody Agreement between PFPC Trust and Registrant        

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Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘485APOS’ Filing		Date		First		Last			Other Filings
		2/24/03		5		31
		8/7/02		2		30
		6/12/02		42
Filed on:		5/24/02		46
		2/28/02		42					485BPOS
		12/31/01		29					NSAR-B
		10/31/01		30		33			24F-2NT,  N-30D,  NSAR-B
		2/28/01		43					485BPOS
		2/26/01		42
		2/5/98		43					485APOS
		12/31/97		43					N-1A/A
		12/18/97		42		43			N-1A/A
		5/28/97		42					N-1A EL,  N-8A
		5/15/97		22
		4/24/97		44
									List all Filings

9 Subsequent Filings that Reference this Filing

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 3/28/24  Spirit of America Inv Fund Inc.   485BPOS     3/29/24   15:3M                                     Blu Giant, LLC/FA
 4/28/23  Spirit of America Inv Fund Inc.   485BPOS     5/01/23   13:4.5M                                   Blu Giant, LLC/FA
 3/30/23  Spirit of America Inv Fund Inc.   485BPOS     3/30/23   14:3M                                     Blu Giant, LLC/FA
 1/27/23  Spirit of America Inv Fund Inc.   485BPOS     1/29/23   24:2.2M                                   Blu Giant, LLC/FA
11/15/22  Spirit of America Inv Fund Inc.   485APOS                2:692K                                   Blu Giant, LLC/FA
 4/28/22  Spirit of America Inv Fund Inc.   485BPOS     4/29/22   14:5.5M                                   Blu Giant, LLC/FA
 3/30/22  Spirit of America Inv Fund Inc.   485BPOS     3/30/22   13:2.4M                                   Blu Giant, LLC/FA
 4/29/21  Spirit of America Inv Fund Inc.   485BPOS     4/30/21    3:1.6M                                   Blu Giant, LLC/FA
 3/29/21  Spirit of America Inv Fund Inc.   485BPOS     3/30/21    2:997K                                   Blu Giant, LLC/FA