More and bigger usually translate to higher cost. Many people spend half again as much on software as they did on the inital purchase of their system. The total cost of a system depends on processor speed, amount of RAM, size of the hard disk, video capabilities, and peripherals. You can make tradeoffs between these pieces to meet your budget. In my experience, you should buy a computer with the fastest processor and the best monitor that you can afford.
Most systems come with adequate memory and hard drives for today's needs.
Peripherals are the extras that complete your system. They include things like printers, modems, and scanners. For most people, a printer is a necessity. If you want to use the internet, you'll need a modem. If you want to create an electronic photo album or scrapbook, you'll need a scanner to convert your prints and other pictures to a digital format.