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Some good points being added, so hopefully this will be an informative thread for anyone searching.
The trick as has been stated is to find your magic point, where any further upgrades (which may be better) are lost on you or simply way outside your budget.
Having listed to some real high-end setups at a headfi meet I realised that I'd not be likely to go to that expense unless I won the lottery.
However, there were a few there who did realise that a setup they did appreciate was withing budget but they had been trying to pare back the cost too much and ended up wasting more than they saved.
If I had the magic setup for all I'd open up the shop and sell it.
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