I think Rrhoads154 has it right. Put most of your budget, maybe all of it, into the guitar and the effects peadal.

I would make the guitar the first priority. If you get a good one, it'll last you a lifetime. My personal recommendation is Yamaha, but as others have already said, that's a matter of personal preference. My point is, I bought something I really liked back in '84, I still have it, and I'm not about to part with it. It's [u]very[/u] important to personally inspect the actual guitar you're about to buy. Prowl every music store and pawn shop you can get to, trying out every new and used guitar that's within reach.

For the pedal, do some research on places like Harmony Central to get a firmer idea of what you want, and what you don't want. Then you can keep your preferences in mind while you're looking for your guitar. Unlike guitars, there's very little variation from one unit to another one of the same model. This makes things like shopping on eBay more acceptable. Basically, as long as all of the functions work, a used Model XYZ RiffRipper bought online will sound the same as one you buy over the counter. But you can save a bundle of cash.

I would recommend making a new amp your lowest priority - maybe even postponing that purchase for a while. You will need some time with your new axe to see where it's going to take you, and the effects pedal will help to give you a better idea of what kind of sound you're going to want. A good amp is a major expense, which could take up all of the budget you have at the moment. Something less than good is not what you want to spend your money on.