I highly recommend a Kindle Paperwhite. More people own Kindle ereaders and I think Amazon is the first target for ebook publishers. In addition Amazon has many ebooks that are Amazon exclusives. Save up and get the Paperwhite. I have owned unlit non-touch Kindles prior to the Paperwhite and the Paperwhite is MUCH nicer. Now I can read when riding at night in a car as well as in full sun and any light in-between.
Ebooks are only expensive if you have expensive tastes, if you MUST read bestsellers or what's new and hot. Unfortunately SOME major publishers are greedy and charge more for ebooks than the cost of a paperback even though ebooks have no printing or transportation costs. My solution to that is I won't but their ebooks. if I ever really want to read that book I will wait 6-12 months and get a used hardcover on Amazon for a few bucks.
I am a voracious reader and most of my reading is indie and new author ebooks from Amazon. I pay from FREE to $2.99
This site points out the latest free ebooks at Amazon - there are TONS
http://www.dailyfreebooks.com/
And Amazon has its own Top 100 Free list (Top 100 in each category) on the same page as their Kindle Best Sellers list.
Because I read so much I also joined Amazon Unlimited ($9.99/mo). Over 700,000 of the ebooks on Amazon are part of Kindle Unlimited and I can borrow as many of those as I want, any time I want, up to 10 at a time.
I highly recommend Kindle Paperwhite.
And just because you have an ereader does not mean you have to read every book on the ereader (although you will want to). if a book you want is too expensive, borrow it from the library or buy a used paperback or used hardcover. You could also check http://www.overdrive.com/ - search for your zip code below the banner on the right - maybe a local library supports ebook lending via Overdrive (though that usually does not include hot new bestsellers).
And btw - these are nice Paperwhite cases on Ebay - sturdy covers and gives a margin of case edge beyond the edges of the Kindle - should help protect it if accidentally dropped.
http://www.ebay.com/itm/321098002310