Both your CPU and your GPU are pretty weak. Moomoomage's suggestion of a 550ti is a good one and definitely the one I'd go with but only if you're not a major player of CPU intensive games like Civilization 5 and Supreme Commander.
Your PSU is serviceable for cards and processors in that range.
Actually now that I think about it a good way to tell which one would be better for you would be to do this simple test. Open up a game you've been playing alot or want to play and get a sense of the frame-rate. for extra accuracy use fraps or something like it to see the actual frame-rate. Lower your graphics settings all the way down. If the framerate improved its your graphics card... if not you need a cpu.