That's why I've rounded up a few different methods you can consider if you want to step up to Windows 7 without buying an entirely new PC.
Use the User State Migration Tool. This is an official Microsoft application that will migrate your user profile from Windows XP to the new Windows 7 installation. Beware, though, that this is a somewhat foreboding tool that isn't designed for average folks to use all willy-nilly-like. Want to see if it's right for you? There's a 12 minute video on TechNet that explains exactly how to upgrade your PC using the User State Migration Tool.
Use Windows Easy Transfer. You probably know that Windows Easy Transfer lets you copy files and settings from one computer to another - but it's not really designed to copy files from one installation of Windows to another on the same PC. Well, Microsoft devised a work-around that lets you use Easy Transfer to upgrade in-place on the same computer, and they've documented the process in a five minute video and step-by-step tutorial.
Use a LapLink cable. LapLink was thinking pretty the same thing as Microsoft - they've concocted a way to use a $20 cable to do an in-place upgrade, similar to Microsoft's Windows Easy Transfer approach. Check out Rick's tell-all post to see how LapLink Simplifies XP-to-Windows-7 Migration.