What should I upgrade first on my budget system?

The rest of the OP's system is fine! Depending upon how much he has invested in LP's a cartridge upgrade would be good. A Hana SL plus an SUT is an easy recommendation. Keep the PS Audio preamp and the Will Vincent Baldwin tube amp. Both units offer excellent sound quality! 

For a DAC I can recommend the Khadas Tone Pro 2 for around $249. Keep the Rotel in use as a transport. I have the less-costly Khadas KTB. Both are competitive with any DAC below $1K.

@carlsbad +1! Speakers offer the best-bang-for-the-buck! I can only recommend what I use: DCM Time Windows and Ohm Sound Cylinders. Two great classic designs that can be found at affordable prices. Both are competitive with today's four-figure speakers! 

@ghdprentice : I think you are mistaken when you state that streamer sound quality is better than CD. You are at the mercy of whatever compression schemes the streaming services use to squeeze their data files to fit on the digital pipelines! No thanks! I will stick with my CD players/transports and extensive CD collection.