Am I being ripped off!?

Yes, it will speed it up considerably. I did that, and the speed gain (for me) (I'm a gamer) was incredible.
 
Matters what it's slowing on. if it's a game it won't help, but for loading time on programs it will. 512mb is fine, i don't think you will need 1gb. i don't think you will need to upgrade in a year or 2. for college life it will last 5+ years. for basic gaming it will last about 3-4 years. thats an ok price on it too.
 
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