Your current character will remain. They are still hashing out details for the rollover, such as whether you can change character names, use the new character model designer, etc, but they have confirmed that all progress from 1.0 will carry over to 2.0.
As for the client, new players will have to purchase the new client, either as DLC or as a store package, but existing players are supposed to get 2.0 as DLC for free. (From what I understand, anyway.) We will not have to re-buy 2.0 unless we want the physical disks and whatever extras they throw in the box as an incentive.
____________________________FFXI: Catwho on Bismarck: Retired December 2014
FFXIV: Katarh Mest and Taprara Rara on Lamia Server - Member of The Swarm Curator of the XIV Wallpapers Tumblr
I can't understand anyone who skips the cutscenes of a Final Fantasy game. That's like going to Texas and not getting barbecue.
and the XIV Fashion Tumblr