On board sound is average, but for most people (including me) it is fine.
I can't recall any games that won't play with on board sound - your on board sound acts like a sound card, so it meets game requirements.
If you are going to buy a decent sound card, you also need to make sure you have a good set of speakers - I would budget at least $80 for the sound card and $100 for the speakers.
Ideally, you would spend $150+ on the sound card and $200+ on the speakers.