Copyright Goodheart-Willcox Co., Inc. 50 E Q ssential uestion Terms Objectives After you study this section, you will be able to: • Identify financial tasks that young adults must learn to address. • Analyze how the family life cycle influences financial decisions. • List ways to avoid financial problems. Section 2.2 Young Adult and Family Finances family life cycle personal financial crisis What type of financial decisions will you have to make when you start living on your own? On Your Own As you enter the adult world, your money management activities will expand. You may be eager to leave home and live on your own. Once independent, you may be surprised by the many expenses and responsibilities you must handle that were previously taken care of by your parents or guardians. Managing money well in order to remain independent becomes the number one financial challenge. Young adults who are newly independent will face many new financial responsibilities. You will need to stay on top of fixed expenses, such as rent, taxes, insurance, car payments, utilities, cell phone, and other bills you may be paying for the first time. Planning the use of income to cover expenses will take on new meaning and importance. Following the steps for budgeting that were presented earlier in the chapter can guide you in setting up a budget that will work for you. Some of the financial tasks you will need to assume include: • managing household expenses • paying bills on time • saving and investing for your future Monkey Business Images/Shutterstock.com Having an emergency fund is one way to prepare for unexpected financial issues, such as an unexpected automobile repair.