Adding more RAM to your Mac is one of the easiest ways to increase the capability of the system. In addition, at around $40 for an 8GB upgrade these days, it is quite cheap to do so.
By upgrading to at least 4GB or preferably 8GB, you can see a notable decrease in load times for programs and files, especially when you already have a number of applications open. You may also notice a reduction in slowdowns and the presence of the spinning color wheel, both of which largely happen when applications have to wait for the system to manage memory and prepare it to load the necessary items, instead of being immediately ready to do so.
RAM upgrades are one of the few user-serviceable parts on most Mac systems (excluding the MacBook Air and early Mac Mini models), and Apple provides step-by-step instructions for the process both in its user manuals and online:
To upgrade your RAM, first locate the instructions for how to do so on your specific Mac model at Apple's support Web site, followed by purchasing the supported RAM upgrade modules for your specific computer. Then perform the upgrade on a static-free surface such as a wooden table, ensuring you regularly touch the computer's case to keep static electricity from building between you and the system, since discharges can harm electronic components.
While in most cases RAM should work fine, sometimes modules can be damaged or otherwise not work properly, and will result in crashes, hangs, or even data corruption when used. Therefore, when the upgrade is complete and your Mac is reassembled, make it a priority to run a memory test on the new RAM you just installed as soon as you can. Preferably do this immediately instead of booting your system to OS X, since faults in RAM can result in data corruption and other problems that your system would benefit from avoiding.
To test the RAM, boot the system into the Apple Hardware Tests, which on new computers can be done by pressing the power button followed by holding the "D" key held (or Option-D to download the tests via the Internet). On older systems that came with a gray recovery DVD, you may need to insert it before booting with the D key held in order to load the tests.
With the testing program loaded, you have two options. First you can simply run them with the default settings; however, this will only do a rudimentary test of your system's RAM. In situations where you need to immediately use your system, this is the best option to take; however, if you have the time, then check the box to run an extended test. Do keep in mind that the extended tests will take considerably more time than the standard test, and if you have 8GB of RAM or greater, then expect the tests to take a few hours to complete.
Memory tests consist of the system reading and writing to the RAM, and performing these operations several times while cataloging successes and failures to see if there are any problems. With the basic tests the system does a single pass of reading and writing to the RAM, but with the extended tests the system meticulously reads and writes to each bit of RAM, and performs numerous passes to ensure the results are repeatable.
I recommend running the more thorough extended tests on your new RAM, but because it can take a while I recommend you perform the RAM upgrade immediately before going to bed or before leaving your office, so the tests can be left to run overnight. When the tests complete, should there be any errors, then you will see them listed in the results section of the test log (below the big Test button), but if the results do not show any errors, then click the button to restart the system, and enjoy your RAM upgrade.
On the other hand, if the tests do show an error with the memory, then consider returning the memory for a replacement; on some systems you can try swapping the memory around in the available RAM slots to see if it will be recognized and accessed properly.