spend on the streamer or on the DAC ?

In my personal experience, if the streamer doesn't apply badly implemented sample rate conversion or otherwise messes up the signal (even cheap solutions like chromecast audio are in this category, the chromecast hdmi and most android based solutions are not), then the spdif signal from the streamer only requires jitter to be reduced before reaching the dac, since most dacs are very sensitive to incoming jitter regardless of marketing bs or technical descriptions of nice concepts that are not properly implemented to be effective at the low levels advertized which requires not only clocks but also ps and routing. Most dacs starting at a few hundred dollars can sound great if incoming jitter is under control. Often the simpler the better, ideally without incoming signal treatment like src.
Before changing the streamer or the dac, my advice would be to test a jitter reducing device between them with as good as possible digital cable before the dac, so that the best of what the existing units can do can be assessed. I tried several  solutions over the last decade and only 2 really stand out: SynchroMesh asrc reclocker for SPDIF from Empirical Audio with reference coax cable and AFI USB synchronous reclocker from Acousence. 2 totally different technical solutions but both exceptionnally well implemented and effective. My bet is you will not believe what your existing setup can actually deliver. Try to get a money back guarantee or a possibility to audition, as usual, since the rest of the playback chain must be up to the task as well... especially the speakers and their interaction with the room.All the best in your audio journey, Patrick

I have the Schitt Yggrasil and a PS Audio Direct Stream w/ bridge 2 in two different systems. They are both excellent DAC’s.  I slightly prefer the PS Direct Stream DAC, but that may just be the system, with my ears and preferences.  When I listen to the Yiggrasil, I don’t miss anything or wish it was something else - it’s that good. 
You could probably get a gently used PS DS for $3,500 to $4,000. 
The guys and gals at PS Audio and Schitt are very good people to work with. 
Some of the other DAC’s recommended here are also solid choices too. Good luck in your search. 

Given your budget +1 Lumin streamer/DAC (and add Sbooster) Check them out +1 on the PS Direct Stream DAC.

Maybe Mytek Brooklyn Bridge Streaming DAC too.

A few weeks ago I upgraded my Sonos streamer to a Auralic Aries G2, there is no comparison in sound quality. (Auralic Vega dac with Tidal, Roon).

@joeeuro

not at all a surprise

stock sonos streamer is a jittery source... needs reclocking

hence the w4s or other mod or appendage which solidifies the clock timing of the digital out

with this, i don't think you will hear any meaningful difference to other dedicated streamers