Lot's of good, but conflicting advice here. So I'll just throw my nickel into the mix.If, and only if, you really like the Squier, keep it.
Put the money into the best head and cabinets you can find. Go used, but be careful. There's a lot of good used stuff out there, but some bogus stuff as well. For $1K you will be able to get a really nice outfit that'll let you keep up with your guitarists with no problems. Later, you can upgrade the bass if you feel it's necessary.
Squier's are not the trash that a lot of people would have you believe. No, they're not in the same league with MIA Fenders, some MIM Fenders, or a lot of other brands. However, I'll bet that if you were to blindfold most of the people who claim Squiers are garbage, play the Squier through a really good amp and cabs, they couldn't tell you what it was.
Since you seem to like the bass, feel good with it, go for the amp and cabs, leave the bass upgrade for later.
Good luck!!!
