Here is a good thread on how to start inexpensively modifying your GTI.
http://www.golfmk6.com/forums/showthread.php?t=36928
My stage 0 recommendation is driver mod. Taking some driving courses will do more for your track/drag times than just about any car mod. A good driver will often beat an inexperienced driver in a faster car on the track
1st)
Get some good tires, I mean really good. Tires are the single most important modification and will do more for your performance than anything else. Tires are how the power gets to the ground, they control how fast you can accelerate, stop, and turn. They are the most important safety item too. Grip is everything. I recommend for summer use only Michelin Pilot Super Sports. Trust me they make a big difference. ($900 approx)
2nd) Get a Stage 1 tune, it won't improve the sound of the car but it is a good improvement in performance (599ish)
3rd) upgrade your brakes, suggest stoptech pads front and rear and tyrol sport solid brake bushings. Make a big difference in brake feel.
4th) Sound get a downpipe/intake and go stage 2 (about 1K)
5th) SKIP suspension upgrades for performance, most won't improve your performance/ride. The ones that improve your car for certian track conditions are costly. I don't see much benefit to suspension mods for daily driven cars, unless you just like the "feel" of a particular setup. The stock setup is pretty good for high performance driving. Most suspension mods are mainly for looks/lowering. But if you want a cheap lowering I suggest Driver Gear Springs and keeping the stock dampers.
6) lighter rims will go a long way to improving your ride/handling.
