So, we've talked a bit about world design, a little about the opening steps to game design, about controlling the feel of your game in combat and other aspects of keeping things going. What we haven't talked about, and this is probably one of the more important aspects of game and campaign design. That question is where do we assume your players start, and how will progression be handled. These questions are more important for game design then campaign design, but understanding them can help you with plotting out a campaign. Particularly with things like "about when will my players go from the new kids to the experienced bad asses mechanically". That being said, lets start with the three general ways that progression is handled, before going into setting starting points.
Method 1 - Progression by Levels
This is the classic way of doing power progression for characters, you can see it in most of the older games like Dungeons and Dragons, as well as in almost every console, pc, and massively multiplayer RPG. How it works is that characters accumulate experience points, and when they cross a certain threshold (reach a certain number of points) they cross over into the next level. With the level comes new abilities, powers, skills, and generally hit points. Telling the apparent ability of any person is as easy as asking what level they are, which also makes it easier for doing things such as setting up challenges to meet those characters. This works out well for things such as more tactical or strategy based games, as it keeps everything on a fairly even keel. On the negative side, I personally feel that levels feel a bit unnatural, characters show no progress for long periods of time, and then suddenly all at once jump up significantly in ability and power. The jumps in ability can be sudden enough to make things awkward for challenge balancing if you don't pay careful attention to just how much XP you are giving people, and how far they are from hitting those levels. Not that there aren't other ways of handling it (like requiring training time to gain the skill/ability benefits that come with a level), but it is something to keep in mind.
Method 2 - Point Buy Progression
This is the method used in games like GURPS and Champions. Characters are given points, with which they buy things. Power levels are tracked with the number of points a character has, usually rounded to the nearest 50 or 100 points. Progression with this is generally more natural, with a few points being given out every session or few sessions with which the player can buy up abilities that they've been working on. It makes the power curve more natural than a series of spikes and plateaus, but at the same time it opens the door to more unbalanced characters. After all, two people can be given 200 points, one person might make a more balanced and rounded character, while the other completely focuses on one area. The difference in ability between the two people when it comes to the more lethal challenges, like combat, can be as severe as night and day. That being said, with keeping an eye on your characters, point buy systems generally offer the most flexibility in allowing players to build the character that they want to play. Though, from a game design stand point, point buy systems also are the hardest to balance.
Method 3 - Mixed Levels and Point Buy
Mixing point buy and level progression seems to be the most common method that games are using lately. While different games will favor more one or the other, this method generally combines freedom of making what you want with a structure to help keep things on a more even keel. Generally this involves using a point buy like system for progression, letting the characters buy up skills and abilities as they go along, but once they have spent a certain amount of XP, or spent XP in a certain way, they cross a threshold and go up in level, opening them up to new abilities and powers. The combination of freedom and structure makes this one a good one to look at first if you're designing a new RPG for play.
Alright, so now we have the three basic ways of handling progression, lets look at something else. Something important to consider from both a game design stand point, as well as a campaign stand point. That is, starting points.
Character Starting Point
Where you want characters to begin is, as said, important for both a campaign and game design. Campaign design is perhaps the most important, as where your players start off power wise will set the tone for the whole campaign. Though, when designing a game you are also (at least generally) setting out for the base feel of the game, what your system is designed around being able to do, and as such the starting point is important.
From a game design standpoint, is your game's starting point supposed to represent the beginning of the Hero's Journey? The farm boy setting out from home in search of adventure having barely held a sword before? Or are you looking for a more seasoned character as a starting point? Both have their strong points, as well as weaknesses. For instance, if the game goes off of the farm boy approach, then flexibility in making characters is a bit weaker when it comes to wanting to play an older character. Not that it can't be done, but it doesn't mesh particularly well with the game. Whereas the seasoned starting point runs into issues when you are trying to bring around someone who isn't seasoned or particularly talented. Especially when you consider that if your game is starting off at above average performance levels, you won't have much to represent the average or lower performance areas.
Campaign wise, this is less of a problem, but it is something to keep in mind when choosing the system you are going to use. However, the starting point determines here the kind of story that you can tell right from the beginning, and is something you want to keep in mind. Starting off with weaker characters gives you time to introduce things a bit more slowly, letting the players get a feel for the world as their characters experience it for the first time. While starting more powerful, can establish the characters in the world, letting them be known, have already had adventures, already know each other and work together. In short, it can make them easier to draw them in to an adventure. Neither one is right or wrong, and you'll probably find your group will have fun switching back and forth between the two at different times.
For now though, that's all I can put down on this. Apologies for the disarray in my thoughts, feel free to ask questions if you need/want something clarified.