There are two reasons to register a domain name for longer periods of time: 1) you plan on being in business for years to come and 2) you want whatever smidgen of ranking value you might get out of that.
In the grand scheme of things, registering your domain for more than a year at a time is very, very, very low on the SEO priority scale. But as a firm believer in baby steps SEO, even the smallest of small things can make a difference when it matters.
The way I see it, there is no harm in letting the search engines see your confidence in your own longevity. Short URL registration periods can indicate that the site lacks long-term viability, which can factor into the algorithms. Against other quality indicators, search engines may use short registration against you. A domain registered for many years is more likely to provide a confident outlook on the site’s long-term prospects.
With that said, if you had to choose between domain registration for 5+ years or creating a better quality site, go with the latter. But if both are an option, do both.