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You don't need to do these upgrades unless you want to improve performance. With a console you have no option to improve performance you just have to wait until the next one comes along... and if you have expensive peripherals you have to hope they will work with the new console..
For a long time race sims were pretty immune to this whole upgrade pressure. Stuff like rFactor 1, Netkar, LFS and Race07 worked fine on the same hardware during a period of 3-4 years.
But I think we're past that now: AC/pCARS demand far more PC capability, iRacing is about to release their DX11 build. And once you factor in areas like Oculus Rift (which MUST be run at a smooth 75Hz, no frame drops, so your PC must be able to cope!) I suspect that upgrade requirements for PC sim racing will move faster in the coming 5 years than they did in the last 5 years.
I might be proven wrong, we'll see