Jewlers will talk about the 4 Cs-- Color, Cut, Clarity and Carat. I've always loved pretty rocks and am now a gemologist. For me the first three Cs are more important than carat weight. That being said, there is a difference in price between a light quarter, half or full carat diamond. It is unethical for a jeweler to sell a .24 carat, .49 carat or .99 carat stone as quarter, half or full carat stones respectively. There should be a nice price break for a "light" stone.
When we got married and were young and poor JWs, I had a gold band with tiny diamond chips which I loved. It was eventually stolen by a non-JW family member on cocaine. For our 25th anniversary I bought my own diamond at wholesale, since I was working for a jeweler. I chose a .78 carat, E color, VS1 claritey very well-cut diamond. In my opinion the cut is most important, as that is where you get your fire (brillance). As long as you don't go below G-H in color on the scale, the untrained eye will likey not see the difference. I can see it, so I chose E, as D is the top of the scale and way too pricey. Even a SI1 clarity should be acceptable to the untrained, naked eye. Beauty is in the eye of the beholder. I love a gorgeous blue or pink sapphire. Sapphires make beautiful engagement rings and will hold up to daily wear.
One way to get a really nice stone is to ask a few reputable jewlers if they have any pre-owned diamonds in house. Often a jeweler will take a diamond ring he/she previously sold in trade toward a bigger stone. The jeweler will then remove the stone and from the old setting and keep it on hand until a new buyer comes along and chooses a new setting.
The old rule of two months' salary went out the window a long time ago.
Hope this helps!