You can upgrade easily enough after the fact, if the need arises.
The 9800GT is the same exact card as the 8800GT. A very good card for a very long time, but its starting to show its age. Still, at medium settings, its still very capable of putting up playable numbers, so if your budget is tight, you can still go in this direction. A newer card, such as a 4870/4890 makes more sense if you want a longer term solution.
If I'm not wrong, your CPU is a core 2 firstname.lastname@example.org. If that be the case, your CPU is good enough. What brand is your PSU? That can be a point of concern!
As for the GPU, the 9800GT has been a respectable card for quite a while. Though, for that price today, one can get a GTX460, which offers DirectX 11. Plus, it's newer tech. As gamerk316 said, it's started to show its age. Nonetheless, at medium resolutions/ medium settings, that card will perform sweetly.
it's a solid card. your specs are cool. no real reason to upgrade yet.
in a year or so it will be time for a new build but this is for now..
of course if you want to upgrade then there's no stopping you, go for it.
a nVidia card upgrade from what you have or even ATI then I agree with - wa1
with a 500 watt psu, you're good regardless.
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thanks malmental for the heads up and everyone else for the info a year will give me enough time to save up for a new rig