Well, without spending any money, I would wonder what resolution you are running your games at and then tell you to lower the resolution and the graphics settings.
If you do not want to do that then yea, you will need new components. I dont know what your gonna be able to replace your processor with... and if your graphics are integrated, it may also be that you cant add a video card, just depends on the machine, however, if I was you I dont think I would spend any money upgrading that system and instead save up for a newer system.
