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FAQ & Section Info
Overclocking is the act of pushing your system to run at a higher speed then what it was initially designed for. The components usually overclocked are the processors, memory and video card. This is usually possible since computer manufacturers allow for a safety tolerance with their product. Overclocking will allow you reach the higher end of these tolerances.
The main benefit is to get better performance for a system at a lower cost. You can push a cheaper processor (or video card) to run at a faster speed thereby improving your overall performance. However for most cases these performance increases are not noticeable except through benchmarks.
There are a lot of negatives to overclocking. One of which is the reduction of the overall processor lifespan (though most people don't keep their system over 10 years). Overclocking produces more heat in your system which in some cases need more sophisticated cooling systems (e.g. water cooling). This additional cost might offset the benefit of lower initial price. There is also the higher power consumption with the system as you run at higher frequency/voltage. Lastly, most manufacturers frown on overclocking and it could void your component's warranty.
What about those overclocked video cards? Those video cards are factory overclocked by the manufacturers to give you extra performance for the same video chipsets. Since these are supported by the manufacturer, you don't need to worry about warranty issue. Also since they are already overclocked, you won't be able to overclock it much further then a stock non-overclocked video card.
Overall with all the negatives, it is usually not worth overclocking any component of your system for the small benefit it may gain.