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?