Well what are the goals, just some portraits at home or are you looking to take pics of groups? Amateur or professional?
Before spending any big money, I would start small... a single umbrella, a cheap strobe and develop a little knowledge. While you are learning and looking around and defining your needs, you are learning.
Then once you know what you want, you can make a good decision based on your needs. Unlike Keith, who is breaking into the world of professional photographers, and his needs define his choice of equipment, the last year of my needs have more than been 75% filled with nothing more than 1-3 strobes and umbrellas.
The differences are major in terms of $$ investment. I have something like $750 total on all my lighting equipment (4 battery powered strobes, 2 110V strobes, 6 umbrellas and light stands and the requisite wireless transmitter and receivers). Most people can start out with 1/4 the amount of equipment and do just fine, but its not pro level quality, then again... no one is paying me for pressing the shutter, either, but I do get some great results. You did read that Keith dropped a couple thousand and though that is a high amount, its only mid-level equipment in terms of what is out there. I do bet that his results are excellent as well.
I good place to learn about light is
www.strobist.com and look for lighting 101 and 102.