Having repaired WAYYY too many hp desktops from PSU failure, some of them not being repairable because the power spike it sent though the computers fries everything, It would be a good idea to replace the PSU first!
Corsair Builder Series CX430
Great power supply that will run for a long time and you can even upgrade a few more things and still not have to worry!
This looks to be about the best you can get right now as far as the Video card is concerned. Dont get me wrong though, i personally have played on a GT640m running on an i5 and i was blown away by how good it looks and how fast it was!
Gigabyte (GV-N640OC-2GI) NVIDIA GeForce GT 640 2GB