I'm of the opinion to upgrade each piece of armor, as you can. Salvage off a lesser piece as soon as you can to get enough points for the next type up!

Initially get all the Iron weapons/armor as you can. 40 Equipment points each. One nice single buy.
Move on to Steel next, unfortunately here you are dealing with pieces, each one be 10 pieces and 20 equipment points, or 200 total equipment points. Nice thing is you get pieces while on merit level 1.
From there move to Mithril, 20 pieces here at 40 each, or 800 total equipment points each.
Next is Meteorite, we stay at 20 points each, but also add in 1 equipment essence on both the Sword and Helmet and the price increases to 100 each. So sword and helmet cost you 2000 equipment points and 20 equipment essence each. Everything else is just 2000.
Last but surely not least we have Master. 20 pieces each again, but Sword and Helmet now cost 2 essence points and all the rest cost 1. So now we're up to 3500 and 40 essence points each for Sword and Helmet and just 3500 for the others.

In the end, once you've finished off Meteorite for all 5 generals, you'll have spent 60k equipment points and 200 essence points. (which is where i'll be tomorrow I think)

To do all of master you need a total of 105k equipment points and 800 essence points.

So you are over halfway there on equipment points, but need 600 essence points still. All this to say...... Get as many essence points as you can early on so they don't become your bottle neck down the road to finish this stuff off.