Yea what helmet said!
If you have a 4-6 inch lift your drive shaft should be ok, If not its going to be to long. You will want to double check though. Your k5 being an 85 will have a 208 x-case witch means slip yoke rear output. If the driveshaft is too long, compression will damage the case if the slip yoke is pushed in too far.
Part list:
U-bolts
brake fluid
new front u-joint
rear convertion U-joint (1310-1350)
compatable parking brake parts (or parts to convert to disks)
new brakes all around
new front braided brake lines
new breather tubes and check valves for your axles
You will probably need to do something about shock mounts on the rear axle, you may want to check into beefing up the shock mounts on the frame as well.
shocks
case of black spray paint (you want your hard work to be pretty dont you?)
suspention lift if ya dont have one
Now if your not going to lift it you will need front sway bar bushings. If you are lifting it, or it is already lifted ditch the sway bar completly, front lift springs are stiff enough you wont need it.
My train of thought is while your there you might as well do all the work you plan on doing. Do it once kinda deal. I realize budget is a factor and doing it all at once may not be feasable right away. If thats the case I would buy what you can now and wait till you can buy the rest. There just isnt any sence in doing twice what you can do once. Also If you plan on lifting, a lot of the parts will be in the lift kit such as u-bolts.
Good luck, have fun!