I will try to make this as short and sweet as possible. A little background to help you understand my current position.
I left my full time job about a year and a half ago to pursue a masters degree. I am currently enrolled full time taking prerequisites so I can apply to the program. I have been taking classes year round with the exception of this summer. I was also working part-time for the last year, but I left to focus more on school and real estate. As far as income is concerned, I receive VA disability payments that are about $1800 a month. While I am in school full time, I receive $3100 a month for a housing allowance. I am also receiving $1000 a month scholarship for rent that goes right to the landlord. This lasts until January 2019. My fiancee and I live in an apartment that is attached to her parents house, where we pay $1400 a month, with $1000 of that going into a savings account for us to buy our first home. So, realistically we pay $400 a month. The $1000 from the scholarship ends up right in savings. My fiancee makes about 65k before taxes. Together we have about 42k saved, and I have about 8k in savings and about 8k in a Roth IRA. I will be looking for part time work, and plan on having a full time job once I graduate. For these purposes I will only count the income I receive while not working. As far as other debt, I have about $150 in high interest rate credit card debt that will be gone by the end of the month, and $1700 in PayPal credit that is currently 0% interest, and not being reported on credit reports. My fixed monthly bills are about $750, excluding food, gas, entertainment. Here are the questions I have.
1- I have 2 federal student loans. $20,000 unsubsidized @ 5.75%, and $15,000 subsidized @ 5.75%. I was paying $1000 a month which was being distributed to both. I now know that I can direct all funds to the unsubsidized loan. Moving forward, should I pay as much as I can to the loan, enough to cover interest or somewhere in between? I am trying to save up as much cash as I can for my first real estate investment, a wedding, and possibly a used car. but I am not sure how to tackle this problem.
2. Should I use savings money to pay for the PayPal credit balance? My thought is absolutely since the interest will be high when it kicks in.
3. Should I withdraw early from my IRA? Reading Scott Trench's book now, and if I am understanding correctly, I should pull it out. My thought is that the money can be put to greater use in real estate than the funds it is currently in. The 10% fee may be worth the ROI I can get if the money is put to good use.
4. Should we use our saved "first home" money for an investment property, or save up cash separately for the investment property? I am not sure if we would be better off using the VA home loan or an FHA loan for our first home. This may be in the wrong forum though.
