First lighting kit? Try out the Alien Bees.
http://www.paulcbuff.com/alienbees.php
You do need strobes unless you live somewhere sunny and only plan on using natural light.
Softboxes are needed. Theres the options of using umbrellas instead but it's still nice to have a larger softbox for the body. I say a 2 light setup is enough to start.
It all about personal preference, they both create different light, it's hard for us to tell you what you should get. You should possible rent or borrow some umbrellas and softboxes to really see the difference.
Photoflex equipment is good priced.
Between Craigslist and Ebay, you should be able to get some good stuff.
bhphotovideo.com and adorama.com are good websites that sell new equipment