Upgrade RAM to 16GB or new graphics card for Macbook Pro?

I edit very large photos daily in Photoshop CC, each photo around 25mb, with the finished PSD file at 300-500mb. I also have a dual-monitor display. There's a tiny bit of lag whenever more than one or two programs are open, and when I'm editing the screens will freeze for 10 seconds every minute or so. Is this a RAM issue, or do I just need a more powerful graphics card to power two displays? I'm a college student on a budget and want to keep this as cheap as possible. I've seen 16GB RAM on Amazon for $150, which is a stretch but doable. I don't know anything about graphics cards. Also, how would I go about installing either?

The correct RAM specifications for a 2012 13" MBP are:   204-pin PC3-12800 (1600 MHz) DDR3 SO-DIMM.
The most reliable sources of Mac compatible RAM are OWC and Crucial.
Look at this video which shows hoe to install RAM in your MBP:
http://eshop.macsales.com/installvideos/macbookpro_13_unibody_mid12_mem/
Ciao.

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