I assume that this furniture is the previous owner's? What type of furniture do you have?

Yes, it is theirs. I will be ordering a fabric upholstered bed with a tall headboard and I have a dark wood dresser with mirror.

Maybe this one...

I would paint the walls and ceiling the same color, with white trim. If it's in the budget, I'd put in hardwood flooring. Adding a contemporary rug, whether over the existing carpet or over hardwood, will aid in giving the room the look you want.

Simple window treatments such as roman shades, grass shades, or shutters with 4" louvers would work nicely. I'd live with the simple treatment for awhile and see if you need to add stationery side panels. It's hard to tell what the windows actually look like with the heavy draperies and valances on them.

It will really be the furnishings you use that will give a contemporary look to the room. Try to use lighting with a strong modern flair, and update any existing light fixtures.

I agree with Carolyn, plus update the ceiling fan and think about painting the ceiling inset a slightly darker color to draw the eye up.