Jump right in or pay off Debt

[Roberto Santana]

Good day BP,

So I searched the forum and found a lot of good subjects with advice but it wasn't really geared to my situation. If I missed it I would really appreciate someone pointing me in the right direction.

Future: In January I am moving to Northern Illinois as a military transfer and will be buying my first house that will become a rental once I transfer again. First house will be financed using a VA loan and the rental will be 10-20% down mortgage.

So here it is, Over the past 10 years of being young and not educated about money I have stumbled into a good amount of debt. Last year I caught myself at around 60k and all of this is from traveling, buying things I had no business buying, a car that I sold off (after realizing my mistake), and a list of other mistakes that are haunting my dreams. As of today I'm sitting at about 27k after selling off as much as I could, setting a strict budget, and attacking it while still setting aside some savings (currently 5k at $200/m) and putting into my TSP (currently at 40k at $500/m).

So now that you have the back story here is my dilemma:

After doing the math I opened myself to be in 1 of 2 situations:

1. I pay off debt by:

Dumping savings and stopping TSP contributions and use those funds to pay off the debt which will have my paying it off in roughly 16 months. BUT I will then have to wait an additional 6-8 months to have enough saved up for a down payment.

2. I save up the funds and jump right in: 

I do the same but save up the money and have my first rental by early/mid next year. This is what I'm doing right now.

Am I on the right track? What would you do different?  

[Anthony Greco]

Roberto Santana I'm from Naperville originally so hello there neighbor. If I am understanding your scenario right I would really look into house hacking! You can definitely find a decent duplex in the suburbs that you can rent one side out to help pay for your expenses and live cheap. That will help you save up money really quick giving you more flexibility. When you move you can then rent out the unit you lived in and collect that sweet cash flow granted you made a good purchase. If you have not weighed out that option you should check it out.