What should be my next upgrade? Speakers?

If your budget can handle around $2200 for front main speakers, you might consider the Martin-Logan Source. They have been widely raved about for transparency and overall performance for the money, and I suspect would provide a huge difference relative to just about any dynamic speaker that costs significantly less. I should say, though, that I have not heard them myself, and that I have no feel for how well they might mesh with the other speakers of your multi-channel av system.

Regards,
-- Al

I should add to my previous comment that the Source's are 8db less sensitive than your Klipsch's, with similar power handling capability. So if you typically use most or all of the volume capability of the Klipsch's, the Source's would not be suitable. Essentially, I would expect the Source's to give you better transparency, accuracy, and detailing, while sacrificing peak volume. Their bandwidth specs are pretty similar.

Regards,
-- Al

Thanks for the info. I really appreciate it. They sure are beautiful speakers. I now plan on going to the Magnolia Best Buy near me and take a listen. Always hard to compare and listen to speakers in a store. : ) Regards,
David

I would replace your paradigm sub with a (used) James emb-1000 (or 1200) for much cleaner, more musical bass.

I would also sell the Monster HTS-3600 AC filter which is likely doing absolutely nothing for your system.....except maybe it looks good....and use that money to buy the subwoofer.