AVS Special Member
Join Date: Dec 2007
Location: Southern California
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I think that spending the maximum amount possible on a good-quality pair of speakers is the wise choice, because you will keep them a long time. Lower quality speakers tend to be replaced eventually, so that is money wasted in the long run.
From there you can add a subwoofer (a GOOD 12-inch one with adequate power), and then 3 more speakers.
The Onkyo TX-NR414 is a good starting point. It is only $230 at Amazon and a great deal for that price.
A pair of Monitor Audio Bronze BX-5 speakers runs $750, and will be a good pair to start your system.
A Klipsch RW-12D subwoofer, or a similar one, will be the next thing to get, but those main speakers have enough low bass that you won't feel the need to get one soon.
A pair of Bronze BX-1 speakers and a bronze BX Center will run about $700 to get you to 5.1.
When you finish that system, everything will be high-quality, and not a penny will have been wasted.