1. Maybe you want to start with an Area Rug. An area rug will establish your color palate and give you a place to anchor your furniture in the room. 
2. You should buy the best rug you can afford. There are more affordable rugs, lesser quality rugs you may want to use while your save up for a better quality product. A high-quality wool rug will wear like iron and looks better over time. Wool has the capacity to develop its own patina through exposure to light and air and feet walking on it. 
3. What should you spend? In general, use the cost of the other furniture in your room as a guideline for how much to spend on your rug. Your rug should cost as much or more than your sofa. Designers use area rugs for defining a space or adding color or dampening sound. Rugs can create a bold focal point or soften an austere look. Area rugs can be used in large spaces to delineate areas for specific activities or to define seating areas. Rugs with similar colors, patterns or textures can also help visually tie two rooms together. The popularity of surfaces like wood, tile, stone and concrete has created more demand for area rugs as they add warmth and softness to your room, but hard surfaces tend to come with acoustic issues so designers use area rugs for their sound absorbing qualities. Some designers tap into broadloom for additional rug options. Most manufacturers will cut broadloom to size and bind it for use as an area rug. 
4. What size rug do you need? Choose a rug that is two feet shorter than the smallest wall in the room. So for my 10 x12-foot office, I should look at rugs no more than eight feet wide. For a dining room, err on the side of too big. You should have at least 24 inches of extra room on all sides of the dining table to allow enough space for guests to pull out chairs without tripping over the rug. An even wider border is ideal.