Quick Answer

Do not turn the first diamonds into random armor pieces immediately. A safer survival route is full iron gear, shield, food, torches, then a diamond pickaxe and enchanting setup. Diamond armor becomes much stronger after you can enchant it.

Gear Stages

StageMain GoalMove On When
Stone to ironIron pickaxe, bucket, shield, shearsFood and shelter are stable
Full ironIron armor, sword or axe, bowMining trips are no longer deadly
Diamond toolsDiamond pickaxe firstYou can mine obsidian
Enchanting prepTable, bookshelves, XPYou can roll Efficiency, Unbreaking, Fortune
Nether prepGold armor piece, bow, blocks, foodYou can handle lava and hostile mobs

Spending Diamonds

UsePriorityWhy
Diamond pickaxeHighestUnlocks obsidian and better mining
Enchanting tableHighMultiplies value of tools and armor
Diamond sword or axeMediumGood combat bump, less important than pickaxe
Diamond armorMid-lateBest once enchanted
Random hoeLowWait until resources are comfortable

Mining Kit

ItemSuggested AmountPurpose
Torches1-2 stacksRoute marking and spawn control
FoodAround 1 stackSafe healing
WoodHalf stack or moreEmergency crafting
Water bucket1Lava and fall safety
Shield1Creeper and skeleton safety