Although I am among the "do it in a dinghy first" crowd, I agree with most of what Don said, especially if you live close enough to a body of water that will let you get out and sail her. We bought our Catalina 25 for $1000 (without a trailer). I had planned to keep her for a while so we put more money into her (and then she was totaled in a storm). If you know yours is just a "starter boat" you can find one in the $1,000-5,000 range, sail the heck out of her, then sell her. You'll probably be able to sell her for close to what you paid (minus any maintenance and upgrades). The 25's are nice because although the cabins are small, you can squeeze 3 in there for a week or so without it being too nasty. I think the 22's and 23's are a bit small for that, personally.
If you don't live close to a big enough lake/bay for sailing a 22-25' boat, then go the dinghy/day sail route while you plan everything else out. Learning on a small boat is great because you get instant feedback. You have to learn to read everything well, or you're going for a swim. Well, maybe not quite that bad, depending on the boat, but you get the idea. Another beauty of the small boats is that they can be easily moved from place to place, so you can explore remote areas and see how different terrain impacts air flow, including both creating wind and obstructing it.
My kids are 8 and 5, and this will be our 3rd season of boat ownership. There are many others on here who have younger kids, too. If you want to get a sense of what it's like to live aboard, check out CruisingDad's posts, and his web site. Brian is very good about sharing information, and doing so with only a hint of rose to his glasses. There are also a few good blogs about people cruising with kids.
