One of the most frequent questions I hear about decorating is which items to splurge on, and on which it's ok to cut corners to save a little cash. A good mix of splurging and saving is what makes a beautiful room an attainable possibility. Not every item can be a splurge - Even millionaires have a budget, after all. And while you can get by waiting for sales and deals and getting 'copycat' items, a room that is made up of cheap things will always look cheap. Ok for the recent graduate maybe, but not an elegant and sophisticated home.
Of course, a "splurge" price will be different for everyone. Some might consider $200 for a lamp to be a splurge, while another person's splurge price might be more like $500 or $700. And a great deal can look very different to different people.
Here are my general recommendations:
Upholstered furniture, especially seating. Couches and frequently used armchairs should be comfortable, durable, and well-made. Even if you save on a vintage piece, the upholstery will likely be a splurge.
Fabrics that add a punch. This might be just a throw-pillow or a skirted table in a to-die-for fabric that you love, but a gorgeous textile just adds so much.
Lamps & lighting. Most people don't have enough lighting in their home (rule of thumb is more light sources but lower wattages). Some "filler" lamps are ok, but a couple statements lamps or an amazing chandelier can take a room far.
One or two truly unique furniture pieces. Might be a killer coffee table, console, or armoire. Sometimes the stars align and this is a "save" but I think it's an ok time to splurge too.
Dressers if they are for everyday use.
Accent tables, especially side tables.
Media furniture. Technology changes so fast, who knows what you'll need in 5 years? Just don't ever buy media furniture from an electronics store. "Save" doesn't mean skimp on style.
Headboards, unless it's the room's statement piece. I'd go mid-range on this one, for quality's sake, but you don't have to spend a fortune.
Accessories like trays, decorative objects, candles, and books can all be found for a variety of prices and are really what bring personality into your home.
Dining tables, simply because you can almost always find amazing ones for cheap on Craigslist that belonged to someone's grandmother and was built to last. Splurge on comfortable dining chairs though.
Kid-specific furniture can be outrageously expensive and they'll just grow out of it. Buy well-made, simple & chic but don't splurge.
Art - you can find amazing works from emerging artists, use your own photographs or paintings, or nab something at the vintage mall. You can always elevate a simple piece by getting a nice framing job done. But sometimes that amazing piece that will make you happy everyday to see it for the rest of your life is kinda expensive, and if you can swing it, go for it.
Shelving & storage systems. Totally depends on your living situation (renting?) and storage needs.
Curtains & window dressings - Windows are just plain expensive if you do them "right" so I get the urge to cut corners here. There are some perfectly decent retail curtains out there, so saving CAN be done. This might come down to personal preference, but windows are a "save" to me if you're renting, and a "splurge" once you own. No matter what, they should be a nice floor-grazing length and hung high and wide around the window And any curtain will look more expensive if it's lined and the width is double the window.
Where do you splurge and save?