Yeah, go for at least 500GB. The price per gigabyte on mechanical drives are like 7 cents nowadays. RAM is also ridicoulusly cheap, so you can ramp up to 12 or 16 if you're gonna render or do some heavy duty multitasking.
The water cooler tells me that you will be doing some overclocking. The PSU might be a bit too puny for "water cooling level overclocks". The i5 2500k is stupid fast regardless, so maybe invest in a cheaper air cooler and spend the extra money on a bigger PSU?
1TB on hard drive is cheap, 16GB of ram atm is STUPID cheap and water cooler id go for just a good after market heatsink and fan. (links will be british amazon as i am a brit sorry :D) but prices are similar.