Looking to start the year with a new system? You don't have to break the bank, but you may have to make a compromise or two. Here's the PC Advisor guide to sounding like an expert when you're purchasing a computer for less than £500 inc VAT.

This article appears in the February 07 issue of PC Advisor, onsale now in all good newsagents.

Processor you're not going to get the fastest processors at this price, but many of today's chips are powerful enough to make light work of standard applications. The soon-to-be-ubiquitous Intel Core 2 Duos are starting to make their presence felt in this category, with the E6300 a firm favourite. But don't discount the AMD processors – the Athlon 64 3800+ still has plenty to offer those on a shoestring budget. The older Intel Pentium D and Pentium 4 CPUs are perhaps best ignored, however.

Memory 512MB of DDR RAM used to be the standard offering in this price category, but 1GB is now the must-have. You can buy more at a later date, but 1GB is going to become more and more important in the next 12 months. Check you're getting the full benefit of the memory – some onboard graphics controllers need to use system memory, which will ultimately slow the system down.

Storage you can never have too much storage space. Video and music files will quickly fill a reasonably sized hard drive, so buy the biggest you can. 200GB-250GB drives are a good investment. It helps to keep large files archived on DVD, so ensure the PC has a DVD burner. Look for a drive that can write to the –R/+R formats at rates of 16-speed. Rewriting at eight-speed is good and, if you want to copy up to 8.5GB at once, look for a drive with DVD-R DL or DVD+R DL. Write speeds on these tend to be lower, but you need to look for an absolute minimum of six-speed on one of the formats. Realistically, you ought to be aiming for eight-speed.

Monitor to keep the price of a PC down compromises have to be made, and the monitor is often where the sacrifices start. Remember, this is the part of the PC that you're going to be spending most of your time looking at. Virtually all PCs now come with flat-panels. 17in models are the most common, although 19in models are finding their way into this category. We don't see many CRTs now, but they're still a pretty good deal if you can find them – provided you can put up with the bulky casing, the colour depth tends to be better than on flat-panels.

Graphics cards given that the best graphics cards can retail for £300-£400, fervent gamers are unlikely to be best served by a sub-£500 PC. Nonetheless, the cream of the crop tends to come with a decent graphics card. Although our games tests are rigorous, you should look for PCs that can produce 50fps (frames per second) if you're going to be playing games. Today's chips of choice come from the nVidia GeForce 7600 range – particularly the GT or GS. These cards can easily get your PC into 80fps on a number of games titles. Not everybody wants to play the latest games, though, so perhaps you can afford to compromise.

Sound card and speakers you're unlikely to get a standalone sound card at this price point; it's an area in which vendors are likely to try and cut costs. Most motherboards have decent built-in audio chips that can handle six-channel sound, but to get the best out of them you'll need a 5.1 speaker system. Unfortunately, you often won't get anything better than a 2.1 system in this category – indeed, you won't necessarily get a subwoofer at all.