Short Answer

• Invest now, reap rewards later
• Don't have a short term financial plan, but have a long term requirements plan
• Cheap can mean more expensive over a long period
• This is a lifetime investment and one day you may want to see a photo of your child at x months old
• Learn to research and budget so that you can acquire the resources as you grow

My minimum requirements that should be attained to get the best possible returns from your investments:

• Good catalog/basic photo editing package (eg: lightroom 3)
• Good lens beyond kit lens (eg: 18-200 range to cover all possibilities)
• Good flash that can be manipulated so light bounces of walls or ceilings
• External storage with mirror capabilities (eg: WD mirror edition or dedicated NAS)

Long Detailed Answer

Lets be honest here. I have a two year old. My wife wanted top quality photos and we got charged over $1,000 for 12 photos on a burnt CD. This was a commercial company and the photos were good but we wanted something better.

So after some research I invested in a Nikon D90 with standard kit lens. After a thousand photo's later it become clear that I needed somewhere of organising the photos taken on the DSLR and the point & shoot that my wife uses.

I invested in lightroom 3 as we are talking about a long term strategy and the investments that I make now should be reaped a few years into the future.

Then I invested in 2 lenses to improve photo quality: 18-200mm lens for all situations and a 85mm f/1.8 prime for specific portraiture work.

Next up is around $2,000 to by a NAS that has native ZFS support so that I don't have to worry about bit rot during long term storage.

With these investments, hopefully, when my daughter is 30, I will have all the requirements about getting the photos we need from our infrastructure.

My only concern would be the long term support of lightroom, but because I now use DNG, all my edits are stored in the DNG file so I can move to any other solution that has native DNG support.

I don't know if this exactly answers your questions but may give you some food for thought from somebody who has been in your shoes and made the decision to think about the future and not now.

If we cannot afford something right now we either budget for the purchase, or use the credit card and pay it off over a period of time.