PLAN OF DISTRIBUTION
                        OF
CAPITAL INCOME BUILDER, INC.
     WHEREAS, Capital Income Builder, Inc. (the "Fund") is a Maryland
corporation which offers shares of common stock and may offer shares of
additional series in the future;
     WHEREAS, American Funds Distributors, Inc. ("AFD") will serve as
distributor of the shares of common stock of the Fund, and the Fund and AFD are
parties to a Principal Underwriting Agreement (the "Agreement");
     WHEREAS, the purpose of this Plan of Distribution (the "Plan") is to
authorize the Fund to bear expenses of distribution of its shares, including
reimbursement of AFD for its expenses in the promotion of the sale of shares of
the Fund, pursuant to the Agreement;
     WHEREAS, the Board of Directors of the Fund has determined that there is a
reasonable likelihood that this Plan will benefit the Fund and its
shareholders:
     NOW, THEREFORE, the Fund adopts this Plan as follows:
     1.     The Fund may expend pursuant to this Plan amounts not to exceed .30
of 1% of the average daily net assets of the Fund per annum.
     2.     Subject to the limit in paragraph 1, the Fund shall pay, or
reimburse AFD for, amounts to finance any activity which is primarily intended
to result in the sale of shares of the Fund including, but not limited to,
payments to dealers, advertising, salaries and other expenses relating to
selling or servicing efforts, expenses of organizing and conducting sales
seminars, printing of prospectuses and reports for other than existing
shareholders and preparation and distribution of advertising material and sales
literature; provided, (I) that the Board of Directors of the Fund shall approve
categories of expenses for which payment or reimbursement shall be made
pursuant to this paragraph 2, (ii) that reimbursement shall be made in
accordance with the terms of the Agreement, and (iii) that there shall be no
reimbursement for any amounts which were expended by AFD in a prior fiscal year
of the Fund but were not reimbursed in such year due to the limitations in
paragraph 1.
     3.     This Plan shall not take effect until it has been approved by vote
of a majority of the outstanding voting securities of the Fund (as defined in
the Investment Company Act of 1940 (the "1940 Act")) and shall take effect with
respect to any series of the Fund which may be established in the future upon
approval by vote of a majority of the outstanding voting securities (as defined
in the 1940 Act) of such series as provided in this paragraph 3 and by the
Board of Directors as provided in paragraph 4.  The Plan as adopted with
respect to any additional series shall specify the expense limit applicable to
such series pursuant to Section 1 hereof and the expenses payable by or with
respect to such series pursuant to paragraph 2 hereof.
     4.     This Plan shall not take effect until it has been approved,
together with any related agreement, by votes of the majority of both (I) the
Board of Directors of the Fund and (ii) those Directors of the Fund who are not
"interested persons" of the Fund (as defined in the 1940 Act) and have no
direct or indirect financial interest in the operation of this Plan or any
agreement related to it (the "Qualified Directors"), cast in person at a
meeting called for the purpose of voting on this Plan and/or such agreement.
     5.     At least quarterly, the Board of Directors shall be provided by any
person authorized to direct the disposition of monies paid or payable by the
Fund pursuant to this Plan or any related agreement, and the Board shall review
a written report of the amounts expended pursuant to the Plan and the purposes
for which such expenditures were made.
     6.     This Plan may be terminated as to the Fund or any series of the
Fund at any time by vote of a majority of the Qualified Directors, or by vote
of a majority of the outstanding voting securities (as defined in the 1940 Act)
of the Fund or such series.  Unless sooner terminated in accordance with this
provision, this Plan shall continue in effect until June 21, 1988.  It may
thereafter be renewed from year to year in the manner provided for in paragraph
4 hereof.
     7.     Any agreement related to this Plan shall be in writing, and shall
provide:
A. that such agreement may be terminated as to the Fund or any series thereof
at any time, without payment of any penalty, by vote of a majority of the
Qualified Directors or by a vote of a majority of the outstanding voting
securities (as defined in the 1940 Act) of the Fund or such series, on not more
than sixty (60) days' written notice to any other party to the agreement; and
B. that such agreement shall terminate automatically in the event of its
assignment.
     8.     This Plan may not be amended to increase materially the maximum
amount of fee or other distribution expenses provided for in paragraph 1 hereof
with respect to a series unless such amendment is approved by the voting
securities of that series in the manner provided in paragraph 3 hereof, and no
material amendment to this Plan shall be made unless approved in the manner
provided for in paragraph 4 hereof.
     9.     While this Plan is in effect, the selection and nomination of
Directors of the Fund who are not "interested persons" of the Fund (as defined
in the 1940 Act) shall be committed to the discretion of the Directors who are
not interested persons.
     10.     This Plan may be adopted, amended, continued or renewed with
respect to a series as provided herein notwithstanding such adoption,
amendment, continuance or renewal has not been effected with respect to any one
or more other series of the Fund.
     11.     The Fund shall preserve copies of this Plan and any related
agreement and all reports made pursuant to paragraph 5 hereof for a period of
not less than six (6) years from the date of this Plan, or such agreement or
reports, as the case may be, the first two (2) years of which such records
shall be stored in an easily accessible place.
     IN WITNESS WHEREOF, the Fund has caused this Plan to be executed by its
officers thereunto duly authorized, as of June 22, 1989.
                CAPITAL INCOME BUILDER, INC.
               By     /s/ James W. Ratzlaff  
                    James W. Ratzlaff, President
               By     /s/ Vincent P. Corti   
                    Vincent P. Corti, Secretary