This sort of question comes up often and the easiest answer is: there is no set standard. I've met pros that use Pro Tools, other pros use Cakewalk Sonar and other guys love Ableton. Personally I use Logic and Reason mostly. I do have Pro Tools but that's more for strict audio editing - like in the case of editing tons of dialog. In the past I've used Acid Pro, Sonar Producer and spent a good bit of time on Reaper.

The best advice I can give is to pick up the trial/demo versions of these programs and take them out for a spin. Once you learn one it's very easy to pick up another program. If you're not totally happy with your current version of Ableton - try and narrow down what you feel is missing. What kind(s) of features do you feel it lacks? What are your goals for you music and audio? What kind(s) of music and sounds do you want to create? Once you've figured out what you think you want - start playing around with other programs. Also a big thing to consider is 3rd party sounds - which some DAW applications support and some do not. This can really help expand your sound pallate. Other things to consider is if you ever need to "score" to animations or video. If you don't then certain programs will do just fine but others may miss out on that feature - or have clumsy, lackluster implementation of it.

Do your research. Find what fits you. There is no set, standard set up for audio production. Folks are much more concerned with how good your audio is. If you can create awesome audio on a certain set up, stick with it.

One other note: In my own experience I've had to buy things over a long period of time. There's nothing wrong with that approach - few of us have thousands of dollars to spend on only studio stuff. I realize you're on a tight budget so it might be best to focus on what your next piece of gear or software could really take your studio to the next level. Save up then purchase that piece. Do more work - save more cash then get the next item.

One other note: In my own experience I've had to buy things over a long period of time. There's nothing wrong with that approach - few of us have thousands of dollars to spend on only studio stuff. I realize you're on a tight budget so it might be best to focus on what your next piece of gear or software could really take your studio to the next level. Save up then purchase that piece. Do more work - save more cash then get the next item.

Agreed!

Best investment are some good monitor speakers, in my opinion. It's super important you hear the music you create properly.

What are people's opinions of using multiple DAWs? You'll often hear "pros" going on about being master of many different software packages so you can fit in with in-house systems. However, I feel that given the freelance nature of most composition work it's better to find one DAW that suits you and learn it inside out. I've tried learning others - Reaper, Sonar, Logic, etc - but always come back to Ableton, as it's the one I can get the best sound out of.

I guess at the end of the day it's a tool - find the one that puts up the smallest barrier between you and your music.

As for hardware, I'd say:
1) MIDI keyboard - brand not particularly important - again, it's a tool. Get one that feels nice. You can use a keyboard for inputting drums as well, so it's all you really need.
2) Monitors - I'm personally not 100% convinced that you need to go overboard on these. I use fairly cheap Edirol MA-7As, and my stuff seems to sound OK! That being said, I would always jump at the chance for an upgrade!
3) Headphones - for late night sessions, or for hearing your sound in a different setting.
4) [Optional] Condensor mic for live sounds. Particularly useful for catching sounds that can't be made by virtual instruments

I would say, on a tight budget, start with the most basic versions of the four things above. As you save up, sell them off and buy bigger shinier ones.

Don't forget to set aside some of your budget for games! Play them and start analysing the music - before long you'll do this automatically, and it's a great source of inspiration and learning.

2) Monitors - I'm personally not 100% convinced that you need to go overboard on these. I use fairly cheap Edirol MA-7As, and my stuff seems to sound OK!

Have you ever mixed on really good speakers? You'll be surprised at the difference.
To be frank, I honestly don't know how you can work with the Edirols effectively, must be a lot of guesswork under 150 Hz. I am absolutely conviced that it's impossible to mix any real "oomph" and depth so it still sounds like "oomph" on the player's sound system without a proper monitoring situation. No offense!

I would say, on a tight budget, start with the most basic versions of the four things above. As you save up, sell them off and buy bigger shinier ones.[/quote]
I'll have to disagree with this too. You'll end up spending a lot more money that way. Better take your time to save up and then purchase something you won't have to sell at a loss and which will really push your producing environment to a new level, like Nathan suggested.

I'm not a pro and only doing music stuff for fun. But I would advise against monitor speakers if the OP doesn't have a proper mixing room. IMO the money would be better spent on a pair of good studio headphones in that case.

Good that you mention that - and setting up some basic acoustic acoustic treatment is neither costly nor time-consuming.
I bought some basotect scraps on eBay, some plywood panels and cheap cloth and made two pairs of DIY absorbers that do a pretty good job - the whole thing cost about 50 bucks and an afternoon including fetching the material.