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I'm looking to beef up my tower so I can play games without lag, I just don't know where to start.

Acer F690GVM Mobo
AMD Athlon 64 X2 Dual Core Processor 4000+ (65nm/AM2 Socket(940) Code name Brisbane)
2gb DDR2 Dual Channel RAM PC2-5300(333MHz)
Nvidia GeForce GTS 450 1gb (Just upgraded this yesterday)

I've already upgraded my PSU to a 550w Corsair with 120mm fan.

Can't find the specs for F690GVM mobo

At first sight, RAM & graphic card update
Personally, I'd buy/assemble a complete new computer

OS? (xp 32-bit can only use 3 or 3.5GB RAM)
Budget?

Need a better graphics card, can't do much with newer games though because your processor will bottleneck you. Can't get much of a better processor without buying a new motherboard.

tldr;

buy new pc, use that new PSU

You can do a few easy things.

You have a motherboard with at least one PCI-e slot, most likely version 1.0. Luckily for you, PCI-e 2.0 GPU's are backwards compatible with 1.0. However, 1.0 is a slower version so there will be a bottleneck and the newer 5** series NVIDIA and 6*** series ATI cards won't work to their potential. Also they require more power than that 550w psu can put out. I suggest finding maybe a 2** series NVIDIA or a 4*** series ATI. Those will run modern games on moderate settings and older games on high fairly well. Choosing one will require some research on your part.

If you are running a 64 bit version of Windows you can add some ram. TBH 4 gigs is plenty. It might be DDR or DDR2. Make sure.

That's the cheap route. The easier more expensive route would be to buy a new computer from someone like IBuyPower. Those comps will be easier to upgrade in the future.

Good luck.

Upgrade to a total of 4GB of RAM
GTS 250 (Renamed 9800GTX+)
Get an Athlon x4 or a Phenom x2 if you want to keep prices down.

In theory you could get the latest CPU but would require a bios update.

I have
Athlon x4 620 @3.2GHz
9800GTX+
8GB of DDR3 RAM
GIGABYTE GA-MA785GMT-UD2H Motherboard
500GB 7200RPM HDD
550W PSU
3 120MM fans
1 140MM Fan
2 80MM fans
TX3 Cooler Master Heatsink
Lexa S Mid size case
Win7x64

I can run most games at high-max settings at 1920x1080

Could be looking at a $200-$300 to upgrade it so it can play new games.
however I would recommend to get a new motherboard and DDR3 RAM

Also to note. Windows will see all 4GB of RAM if you are running x32 but it won't be able to use it all because it has to also address the memory on the GPU. Therefor stealing Addresses for the last bit of your RAM.

I agree with Amarisa. You might not need 8 GB of RAM; 6 might be enough.