What to upgrade first?

For around $500 to $600, the B&W DM602 S2 are a good choice. An NAD integrated amp is a good choice in the $400 to $500 range.

All of the advice and makes/models recommended here are excellent. I would especially heed Sugarbrie in terms of listening to either speaker or amp w/future upgrade potential if you buy from traditional storefront. OTOH, Jeff's advice about buying good name used gear here or ebay and then being able to re-sell is a sound approach and doesn't require delayed gratification.

THANKS to everyone, your responses were insightful and educational. My thinking tody is to upgrade the electronics first via an integrated amp, which means I will need to get an FM tuner at some point. After settling in with the amp
I can, as suggested, listen to lots of speakers and kind of narrow the short list down. The NAD C370 2x120 seems to have all the controls and features for me now and in the future. I found an on-line seller (The Happy Medium)who quoted me $557 + UPS Ground, no sales tax. If anyone knows of a better priced source please let me know. Thanks again.

If you are looking at $557 for the NAD, consider a closeout Audiolab 8000S from Artech Electronics (if they have any left) at $549, a discontinued $1100 amp that was very highly thought of at the retail price. I'd be shocked if it wasn't a big improvement on the NAD.

Thanks Hdm, I'll check it out.