Step 1: Determine sound sources

Today, computers and phones have become the primary sources of music. Luckily, the quality and speed of the computer or phone are not a major factor in the cost of your system. Even smaller computers and slower phones can produce excellent sound quality if used with external speakers or headphones.

Record Players 
Although vinyl records were abandoned half a century ago for better digital technologies like the CD, they are coming back with a vengeance. They give you a unique analog sound experience and access to a vast library of unique records that have never been released in any other format.

Microphones are used for capturing sound during recording. Common applications include studio recording, podcasting, live performances, and video production.

Step 2: Determine Output and Amplification

It is totally reasonable to listen to music on your computer or phone. But the quality and volume are often not good enough. So you need to determine what type of sound reproduction you want. 

Headphones:
They are essential for private listening and are sold as over-ear, on-ear, and in-ear devices.

Speakers:
If you want louder and better-quality sound, you need external speakers. They range from small desktop computer speakers to giant high-fidelity and high-volume speakers.

Amplifiers:If you want speakers, you need to amplify the sound. Smaller speakers sometimes have amplifiers built in. 

Home Theatre 
If you want to experience your music and movies in a theater-like setting and quality, home theater systems are the way to go.

Multi-room 
If you want to listen to your music in many different rooms, you need a multi-room system.

Step 3: Determine sound quality

An important factor that determines the sophistication and cost of audio equipment is the quality of sound you are expecting. Consumer-level equipment is the most affordable and is perfectly suitable for casual listening. Audiophile equipment, on the other hand, is designed for high-fidelity audio reproduction, catering to individuals who have a passion for exceptional sound quality and are willing to spend much more.