Consider moving the tv to the corner of the room to the right of the fireplace and then turn your sofa toward the fireplace to be used as a room divider at the base of the stairs.

You might consider adding white wood adjustable louvered shutters to the windows for privacy and to control light.

You can put your exercise equipment in the back corner left of the stairs and create a conversation/activities niche between the exercise equipment and the sofa/sitting are and a quiet desk and sitting area on the other side.

Ignore the critics that think you should have new everything for every room -- not all of us have that budget. Don't discard your furnishings. That you have exercise equipment in this room indicates it's not intended to be a formal living room.

While it may well be that not all your furnishings are on the short list of items most of us want to put in our the living room for creating a good first impression -- they're certainly not out of place for a family/activity room. You might want a larger cabinet on which to set your tv in no small part because a taller cabinet will be more comfortable to watch and a larger cabinet with doors would give you media related storage space.

With that in mind, if you're wanting to change this room on a budget, sometimes you can find an old hutch or bookcase suitable for use as a tv stand from an "antique and more" resale (used stuff) store, Habitat for Humanity Restore Store, Good Will or a local charity thrift store that will serve your purpose When you are out and about with a few minutes to spare, wake through these and see if something catches your eye. If you are careful not to collect junk -- if you know the measurements of your room/space before buying anything and buy only what you will actually use, then such trips will not be wasted time.

Good hunting.

Just an afterthought: if you have a small rug you like that doesn't suit a larger space, place it elsewhere -- such as beneath exercise equipment or to define an "office" area ...

I like your floors and you have a good start for your room.

I'm not great at furniture placement but I do want to suggest a larger rug and also some people level lighting. Rugs do a great way of defining spaces.

I would also add some more light. Floor lamp and table lamp light is warmer and more flattering than overhead lighting.

Considering you want an office area, a reading area and a TV watching area, perhaps the below would work for you. The reading area is in the stair nook area and has two chairs, a shared ottoman and side table.

The TV is to the left of the fireplace and the office area is to the right of the fireplace where the window is. A low bookcase serves as a sofa table behind the sectional. It provides separation and also storage for books and games. In front of the desk are two swivel chairs with a shared ottoman and occasional table. Each of the seating areas is defined by and area rug.

If this works for you and budget is a consideration, you can work at it piece by piece, starting with the areas most important to you and your family.