Although many of the replies here are good, another question you need to ask yourself, in regards to dedicated is...
is it managed?
When getting your own dedicated server, you need to know a lot about the technical aspects about servers as you will usually be completely responsible for anything that goes on (software wise). For example: You will be responsible for updating stuff such as php or mysql or perl, etc... If you're email is not being sent through or even received, YOU will be responsible for figuring out why AND then fixing it.
So, if you're seriously considering dedicated, you also need to know about the technical aspects as well...
If you know NOTHING about how servers run or operate, but you still want a dedicated server, I suggest you only consider those which offer MANAGED services.
In such cases, the company providing you with your server will usually be responsible for upgrades, updates, etc... And even then, you have to TALK to the company to find out how "limited" the "managed" aspect is...
- Do/will they provide ALL (minor and major) updates?
- Will THEY provide support when/if something breaks?
- Will THEY be there to handle the technical aspects?
- Etc...
Also, I'd like to point out... Of all of my sites, and I do have hundreds, MANY of them are HUGE in regards to space and MANY of theme receive millions of hits every day and a few of them even receive millions of hits every hour. ALL of my sites are run on shared hosting servers.
Unless your site is of Microsoft proportions, you honestly do not NEED a dedicated server. I have a client who runs a very very very popular membership website. He has hundreds of thousands of members and he doesn't even have a dedicated server. I also manage a local "government" entity based customers' website which receives
millions of hits per hour, and I don't even have them on a dedicated server. I, myself, run a few membership sites, one is a digital reseller products website and I host almost 400,000 resale files (over 4TB of storage space) and even "I" do not have a dedicated server.
Why pay for something you don't necessarily NEED?
Many people think "Oh, my site is going to be huge (or My site IS huge)" and the honest to God truth of the matter is, like I said above, unless your site is proportionate to those of Microsoft, eBay, Amazon, etc... then you really don't NEED a dedicated server.
What you need is a proven and REPUTABLE shared hosting provider.
You will need to have and pay for a little more than just a dinky $5 Host Gator account, but still not as much as you would for a dedicated server.