1) 700 MHz Celeron, 256MB RAM, 40GB HD, 32MB GeForce2 3D card, 24/10/40 CDRW, 48x CD-ROM.
2) 400 MHz Celeron, 160MB RAM, 20GB HD, 8MB video card, 48x CD-ROM.
"I find it hard to believe the average people here would buy a new computer every year or two."
You don't need to buy a new computer every 1 or 2 years to remain top of the line. You just have to upgrade, and what most people don't seem to realize is that upgrading is practically a joke.
First of all, you start off with a new motherboard and CPU. All that crap you have in your computer already should still be good, and the only other thing you might have to worry about is RAM depending on what you want to upgrade to and what motherboard you buy. So... Let's be safe and name those three things to start with. You can do that and upgrade to pretty much top of the line right there.
Next, you probably have a craptacularly small HDD (under 15GB's). My old one was 8GB's... I only upgraded that about 6 months after I did everything else. So, a few months after you upgraded the other stuff, you can go and replace that Hard Drive if you're running out of space. While you're at it, depending on whether you need it or not, you might also want to purchase a new 3D card. Personally, I suggest waiting until the next gen comes out and then snatching it up right away. You'll get the most value out of it that way.
Boom. You now have a relatively new, top of the line computer. Do this every year and your investment costs will be minimal. Your biggest investments in your computer are the things that never really get old and useless. Any hard Drive that's 30GB+ should provide you with quite a few years of adequate storage space provided you don't fill it up with useless junk (use a burner to back up junk files and take them off your computer). As long as your monitor works, upgrading it is pointless. Your CD-ROM/CD-RW/DVD drives are probably pretty damn good still, and stuff like printers and scanners don't need to be upgraded either unless you want better quality.
Take me for example. I'm soon upgrading to a Celeron 1.8GHz CPU, with a new motherboard, a new case and powersupply, 128MB GeForce4 (cheapest one available), and 256MB's of 333Mhz DDR-RAM. Total cost: $586 Canadian. That's $367US. I'm keeping my 40GB HDD, my floppy drive, my burner, my CD-ROM, and my Monitor.
Then, with what I'm left over with, all the pieces from my other - slower - computer will be put into there. Then with what I'm left over with again, I'll just collect spare parts here and there, maybe look around at second hand computer shops for monitors, 10GB HDD's and such, and then put it all back together again and I'll end up with a 3rd computer. I do this once a year, and the end result is a practically top of the line computer and one extra computer to do whatever else with for less than 1/4 the price of buying one brand new.
Don't need that extra computer lying around? Then make the investment in secondhand pieces, rebuild it, and then donate it to a school or some orginazation and get a tax refund on it that'll usually cover more than what you paid to rebuild that and upgrade the other one.
Another really good trick for cutting upgrade costs is to stay out of big brand electronics stores (Staples, Office/Business Depot, Futureshop, Circuit City). They aren't specialized in computers, therefore they charge more for parts and they don't react as fast to constant price fluctuations in the market. Try and find a store near you that builds custom computers and sells parts. They're your cheapest and best bets.
Also, do all the work yourself. For those of you who don't know anything about them, let me assure you that it's not hard. If you know how to hook up your VCR or Stereo system, that's about all the experience you need. When you open up your computer to take parts out to begin with, you'll realize right then and there that it's not quite that hard, especially since most wires have only one place to fit into, and if there's more than one place you can put it, it'll probably work there too. I'm not saying experience isn't a bonus, but I am saying that it's not as complicated as most people make it out to be. Just take good note of how everything is set up already.