Mostly, the money you sink into a sound card is for sound processing for games, such as EAX.
Whereas the money you sink into speakers is for music--sound quality. Some sound cards can be "cleaner" than others because they have better DACs, but you are still majority limited by your speakers.
How much you need to spend? As much as whatever features seem important to you.
For some people who have receivers and prefer to offload sound processing to their receiver processors and DACs, they'll buy DDL (dolby digital live) sound cards than can encode multiple analog channels into a single digital channel (much like Dolby Digital 5.1 is a single channel with 6 compressed channels of sound), and in doing so, also only need a single (digital) cable to connect to their PC, instead of 3 analog cables for surround sound.
Some people like to have the newest sound processing for games like first person shooters, so they buy Creative cards for EAX5 (or whatever is newest).
Some people just want to buy whats easily available, so they buy Creative X-Fi cards, and buy whatever off-the-shelf PC speakers.
Some people just like simple solutions for music (like myself). I just wanted a sound card that could play music without resampling it (Creative cards resample all music to 48KHz), and I dislike the loss of quality there. So I bought the Chaintech AV-710, it's a simple sound card with a digital optical connection, and I offload the sound processing to my Panasonic receiver. It was $20, and since I already had a receiver (with built in DACs), I figured I didn't need to waste money on an expensive soundcard with better DACs.