Welcome aboard. There are a lot of us who have been there - I went through the same thing myself a few years ago, restarting the backpacking habit after long hiatus, and boy, do things change when there's a decade or two of aging...
You would be off to a good start reviewing the articles and gear lists linked on the main page of this website. Not all lightweight gear has to cost a mint - if you look at tarptent.com you will see shelters that cost a third of the big name (MSR, Big Agnes, etc) tents labeled ultralight, in addition to weighing a lot less.....
BUT. You need to take into consideration where you want to go, what season, and your own comfort levels as you're choosing gear. So some reading of reviews and forums might help you sort that out. backpackgeartest.org is a good review site.
You can get some good info at Mark Verber's site (http://www.verber.com/mark/outdoors/gear/index.html
) as well - he has gear lists and reviews of all kinds of gear and clothing, as well as how to find cheap gear.
The kitchen is a really easy place to simplify and lighten up. Sometimes you can take a lot of weight out by doing all the cooking at home and switching to a boil and rehydrate method - trailcooking.com and aforkinthetrail.com are some good recipe sources, and online sources like minimus.biz, packitgourmet.com and harmonyhousefoods.com are excellent sources of recipe ingredients and easy to fix meals.
And now that I'm overwhelming you with information, lastly, I suggest putting together a gear list (with weights of individual items) and posting it for review to get suggestions of how to go about getting a lighter pack. It helps to know where and when you plan to go backpacking, and what your priorities are - you already mentioned budget, that sounds like the top priority. Most of us have our own unique balance between budget, comfort, and lightweight. Durability is sometimes also a concern, but sometimes a tradeoff has to be made in durable vs. light.