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@NickCJ
That sounds like the way to do it, but bear in mind that there is only so much money that it's worth spending on an older bike (I wish I was more able to follow this advice!). Small things like changing tyres, bartape and saddle can make a massive difference to the overall impression of the bike without spending too much. Put up some wanted ads and scan the classifieds on here - people usually let older stuff go for very reasonable prices...