Advice Concerning Desktop Upgrade for Gamming

The PC that I own has always caused my trouble playing modern videogames. I would like to change this situation.

My current computer characteristics:
CPU: Intel Core i5-750 (4 cores @ 2.66 GHz)
Video Card: NVIDIA GeForce GT 240
HDD: ST3500418AS ATA
Monitor: LG Flatron w1946
Power Supply: x-torm regularity power htfapt500s (Max output power 500W. Input AC 230V (we work with 220V here) 6A 50Hz
Motherboard: ASUS P7H55-M
OS: Windows 7 Professional 64bits

I have a budget of 600€ (~780 USD). Although I can afford expending more money, that is what I have in mind.

Therefore, should I focus my upgrade only in the Video Card and Monitor? Should I upgrade something else? What would be a smart buy? If you be so kind as to suggest my some choices for the components you think I should upgrade I will really apreciate

Thanks in advance.
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More about advice desktop upgrade gamming
  1. The i5 is still a decent processor , so your easiest upgrade may be to check your power supply is an 80+ bronze [ or better] unit and then add a powerful graphics card

    A Radeon 7870 , or Nvidia GTX 660 are in the 200 - $230 range and should let you play all games at decent image settings with your monitor

    A 24 or 27 inch monitor is an upgrade I would ant to do too .
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