My wife and I will be taking our first trip to Italy for 2 weeks the end of June/early July. We decided to do it ourselves versus going on a tour, which costs a lot more and is more restrictive. We are planning seeing Venice, Florence, Cinque Terre, some Tuscany hillside towns and Rome (and maybe a long long daytrip to Pompeii). I know it's going to be warm/hot, but what types of clothes are best...shorts, polos, tshirts, some khakis for dinner, etc? Any advice on a beginner would be helpful.

Also, outside of airfare, what is reasonable to expect to pay for 2 weeks for hotel/hostel, food, purchases, etc.?

1.Think through your schedule again. It's VERY full.
2.To enjoy anything close to this schedule you'll need open-jawed tickets.
3.It most likely will be hot. Air conditioned rooms are a must (at least in cities).
4. You seem to have described typical clothing. Remember no shorts in churches.
Costs really depend. Venice,Rome and Florence are generally more than Tuscan hill towns. What are you accustomed to and desire?
Same question concerning your meals.
We try to not spend more than 180E in cities and in high season that doesn't give us as nice a room as I generally would like. Because I usually use Hilton points for the bigger cities, I usually don't have to face this problem.
In the Tuscan hill towns one of our favorite places is an agriturismo at about 90E/night. I don't think we ever spent more than 180E.
We have had trips where we went all-out on our meals and others where we spent much less. Again,the cities cost moe. But,there's always pizza and plenty of inexpensive wine.
Enjoy your planning.

probably you would only need light clothing.
Prices in the small Tuscan towns are cheaper than in main cities and restaurants are better - cheaper and great food wherever you go.

Packing: Your list sounds good. Take a lightweight sweater and/or lightweight jacket "just in case" or for the evenings. Walking shoes and nice shoes for dinner in the evening. For your wife, if she wears skirts, I would suggest a couple of those. She will also need to remember to cover her shoulders and no shorty-shorts in St. Peters and other churches. Wrinkle-free and no-iron items are a must (ie. no linen). Cotton blends are great. You are moving around a lot so pack as light as you can. I always pack twice, the second time culling through the suitcase. Just got back from LA & San Diego and wore, at most, 2/3 of what I packed. That's even after two passes through the suitcase!

Budget: Admission fees can quickly add up in Italy. I'm not sure specifically what you plan to see, but I would think $50 a day (on average) for two people would not be out of line. Food is obviously quite variable. Some people are content with sandwiches and pizza everyday and others enjoy trying all of the top restuarants. If breakfast is included in your hotel then I would think $25 - $30 would be a good budget for a simple cafe lunch for 2. For a decent restaurant dinner, I would suggest $40 - $75 depending on courses and wine selection, etc. There are always sandwich shops and pizza to help you average-down your food budget.

Some tips on where to eat. In Rome, avoid eating near the Pantheon or the Piazza Navona. The Trastevere is a fun place to eat and you will see more locals there. For a fun atmosphere for after-dinner drinks, I prefer the Campo dei Fiori to the other famous piazzas. Again, more locals. In Venice, avoid eating near St. Marks and head to the Dorsoduro area where you will typically find more local restaurants, thus better food and prices. Florence is a good place to splurge for a Tuscan style meal.

As far as hotels, Rome, Venice and Florence will be your biggest challanges for reasonably priced lodging. I have some suggestions for you so post if you're interested. In the Cinque Terre prices should be more reasonable and as Jabez stated, in the Tuscan hill towns, you will find some wonderful and memorable places to stay at the agritursimos.

Personally, I would leave the shorts and T shirts at home. Unless you are at a beachside spot, these are out of place for Rome, Venice and Florence. I am sure some will disagree but I would never pack shorts for this type of trip and my husband would not either.

I budget about 200E per night for accomodations though with persistence and research you might do better. There are certainly less expensive accomodations to be had but I prefer a full service hotel to a B&B and I book 3-4 star properties.

Breakfast is generally provided and lunch runs 10-25 E per person dependent on several factors, including where you choose, what you order, how much and if you drink wine. Dinner runs us about 100E for 2.

In 2 weeks we will spend another 150 E each on trains and buses, and as much on taxis.

All above advice is solid.

Hotels: I also like a more full service hotel when it's just the 2 of us. You could try a search on www.accor.com I have stayed a few and have found most to be fine for the price.

Meals: It all depends on what you want. We are not big eaters so typically we have a coffee and maybe a light breakfast (if provided by hotel).

Normally only an ice cream (gelato) and maybe a latte sometime during the day.

Evenings can be a full dinner or pizza and salad at a little cafe.

50-100euros/day

Rome is very expensive and the prices do vary depending on where you eat....sometimes only a block away you might pay 2 or 3 euros less for a coffee!

I agree with kfusto on the clothing. Also would add that if you want to dine out in the evening a nice button down oxford works well with khakis and can be pressed back to shape easily. Not sure what your wife prefers to wear but for myself I always carry a packable skirt that won't wrinkle and can be worn with more than one top for evenings.

My husband likes the safari style pants for daytime. I tend to wear nice capris or summery skirts.

Sounds like a great time! Have fun.

Dgg: I'm always looking for suggestions if you don't mind! Last September I had to beg for rooms at a Crowne Plaza for 250euro/ night St. Peter Cathedral area - Rome was booked!

I think your clothes sound fine. I know some people make a fuss about no shorts for tourists, but it can be HOT in Italy in the summer time. I think as long as they are a decent length and fit they are fine (except for going into churches and nice restaurants).

Pack thinking of 1 week then do laundry or have it done somewhere mid-trip, really saves on what you need to take. The most important thing imo is 2 pair of comfortable walking shoes or sandals that you can switch between.

Very difficult to estimate a budget for you without knowing more. In the most general way I'd say...

hotel: 80-150 euro for a couple per night for a 2/3-star type hotel, B&B, or private room in a hostel

food: 50-200+ euro for a couple per day depending if you picnic from bakeries and grocery stores, drink wine/beer or cocktails or not, what kinds of restaurants you go to.

purchases: 0-????

misc: You need to add local transportation - bus, taxi, train, vaporetto, admissions to museums, daily expenses like that.