My examples:

$725.
2009 Trek 1.5 first road bike. I loved it until I pushed it then I "needed" more bike.

$750.
2nd road bike, 2009 Cannondale CAAD9.
Far better for the riding I was doing, but I outgrew it as well.
So I began to upgrade. Now she has $4,200. into her (including purchase price).
But I knew exactly what I was doing when I purchased her. I wanted the frame really.
But found a brand new complete bike for less than the cost of the frameset alone.

If I never road any differently than I did in the beginning, the Trek 1.5
(currently the 2.X Series) would've been an excellent choice for me.
In the end, how much a rider needs depends on how he rides.

Some could do just fine with a sub-$1,000. bike for years and years.
But more aggressive riders would certainly benefit from a better equipped bike.