WinXP – slow in accessing files in apps

I have a P4/2GHz/256RAM system running WinXP Pro SP1 with MS-Office 2002 SP1. Lately my system is slowing down greatly whenever I have to change folders to save or open a file in Office. For example, when opening an existing XL file, I click on the “Look in” drop down box & then I have to wait sometimes up to 15 seconds before it responds. This also happens when saving. I don’t have any problems opening/closing folders in Explorer.
This is driving me crazy & I’d appreciate any ideas.
Manythanks in advance.