Proceeds from the sale of normal income security may be used for which of the following purposes?

The choice that correctly identifies the appropriate use of proceeds from the sale of normal income security is the allocation toward essential family living expenses. This aligns with financial management principles where funds acquired from the sale of assets are ideally directed toward supporting the basic needs and living expenses of the family. Essential family living expenses include costs such as housing, food, healthcare, and education, which are considered necessary for maintaining a basic standard of living.

Using proceeds for essential living expenses ensures that the financial stability of the family is prioritized, allowing them to cover vital obligations rather than allocating funds to non-essential or luxury items. By focusing on necessities, individuals can manage their finances more responsibly and avoid potential financial strain that may arise from diverting funds to non-essential expenses.

In contrast, options like personal luxury expenses and investment in market securities do not address immediate needs and could compromise financial stability. Similarly, while paying for previous debts may seem prudent, the primary focus when leveraging sale proceeds should be on fulfilling essential ongoing living requirements.