lowering the cost

You've selected a non-overclocking board, so you could change the CPU to a non-K version. You could then omit the cooler as well.
Although 650W is more than you need, looking at the price you're not going to beat that with a spiked club.
 
You need to either spend more on the motherboard for an overclockable Z87 motherboard, or ditch the "K" series processor and the heatsink and just go with a stock i5.

I wouldn't recommend less than an i5 for a gaming system. The motherboard you chose with an i5 4440 or 4670 etc would be a good option and save you a few dollars.

You could save 5$ going to DDR3 1600, but I would stay with what you got personally.

If you really had to cut cost right now, you could consider dropping your GPU to a radeon 270/270x. I will play most modern games a mediumish settings. You will have to upgrade the GPU in a few years anyway.
 
Significantly lowered without sacrificing performance

PCPartPicker part list / Price breakdown by merchant

CPU: Intel Core i5-4440 3.1GHz Quad-Core Processor ($174.99 @ Newegg)
Motherboard: Gigabyte GA-B85M-D3H Micro ATX LGA1150 Motherboard ($79.91 @ Newegg)
Memory: G.Skill Ripjaws Series 8GB (2 x 4GB) DDR3-1600 Memory ($73.99 @ Newegg)
Storage: Western Digital Caviar Blue 1TB 3.5" 7200RPM Internal Hard Drive ($59.99 @ Newegg)
Video Card: MSI GeForce GTX 760 2GB TWIN FROZR Video Card ($239.99 @ Newegg)
Case: Corsair 300R ATX Mid Tower Case ($79.99 @ Newegg)
Power Supply: Rosewill Hive 650W 80+ Bronze Certified Semi-Modular ATX Power Supply ($49.99 @ Newegg)
Optical Drive: Asus DRW-24F1ST DVD/CD Writer ($14.99 @ Newegg)
Operating System: Microsoft Windows 7 Home Premium SP1 (OEM) (64-bit)
Headphones: Creative Labs Creative Fatal1ty Headset ($24.99 @ Newegg)
Total: $798.83
Prices include shipping, taxes, and discounts when available

Only other ways it could be lowered more is by going with a cheaper case, AMD build, or going for a slightly slower R9 270X
 
Solution