Rule of thumb:

All furniture legs must be on the rug

or

Two front furniture legs of all furniture must be on the rug (your situation)

or

The rug is in the middle with no legs on it at all.

Yours is fine, it's up to you. I might like larger to create a "room" within the larger room.

I think it's too small and the 9x12 would be better.

It’s a large room so I’d definitely go bigger. And although it technically follows the “front feet on” rule, every piece barely has the feet on so it looks ungrounded. What if you had a rug that went from right in front of the floor registers to an equal distance from the stair wall on the other side? Then your two chairs would be fully on the rug and your couch would be mostly on. I’m guessing that when you get a coffee table, you’ll scoot the two chairs inward a bit. I like the colors in the rug.

I think 8x10 just fits the bill, but 9x12 would be even better. I have an 8x10 Ruggable in my dining room and it's just big enough.

If you decide to go bigger and want to exchange what you have, would you possibly consider getting something with a little more warmth to liven up your neutral palette and brown furniture?

ETA: Sorry that I just made a suggestion that wasn't solicited and it annoys me when people do that, so if you're totally happy with the rug color/pattern you chose, just ignore me. :)

I'd go with a bigger one...

Another vote for bigger.

Thanks for all of your opinions! This helps a lot. I've been feeling like it is a little too small and that seems to be the general consensus. I'll order the larger.

I am looking for new couches for this room as well. I've been thinking about getting a Caramel/Camel color leather sofa and love seat, and maybe a grey or cream colored chair. Do you think that would look good?

I would buy the larger rug.

I would go bigger if it's available. Your current rug fits well within in area rug "rules" but a bigger rug would look more posh.

Regarding your new furniture choices, most of your room finishes are warm so I would avoid cool greys if you are a novice decorator. Grey and tan can work well together, you just have to make sure you spread the gray around the room with art and other decor so it looks intentional.

Yes to a bigger rug. I'd buy new furniture and then choose a rug. I remember a man who had a decorating show on HGTV a long time ago - he said think about upholstered pieces as "the little black dress" and think of pillows, rugs, and art as "jewelry".

That is a really good tip about the colors. I am definitely a novice decorator, so I appreciate the help!

It definitely works. But I think bigger rug would look best.

Like this

IMPO, the furniture has a big presence and it makes that rug look skimpy. I agree with those suggesting you get the larger size.

Jen, if you’re getting new furniture, I’d maybe wait on the rug. You might decide you want something different.

I agree with @Bunny both about not offering unsolicited advice and more color would be better. Take your floor into consideration. This rug really doesn't complement it.

I like the color you chose.

I strongly dislike the red.

You need to decide what you like.

The lighter rug gives the room a cooler, airier feel, IMPO. Those red tones give it a warmer vibe.

I like the smaller one better - it looks more intimate. I would get the larger one only if you want to push the larger sofa further away from the fireplace, and that might not be a good idea, depending on what is behind it.

You've got a point, Lars.

And I imagine there will be some other furniture in between - like side tables...?

I like the larger, but would place it so the sofa is fully on it. Since you don't have your furniture selected yet, nor your final colors, I just picked some random selections to show the placement I think would look better.

Thinking the 9x12 would give you more to work with, even though the 8x10 is ok. You have a very nice room there!

Do you have a floorplan? One of the things an area rug does is, in a sense, "define" the parameters of rooms that are part of open concept. So you want to see on a plan what size you want that to be. How much room do you need/want between this area and the kitchen? Roomstyler is free and pretty easy to use. Warning: can be addictive.