Don't put any money into it until you give it a good evaluation. It bites to get half way through a restoration and find a hidden deal breaker. As mentioned, a bike co-op or club would be a big help. Photos would also help. If you can post clear close-ups of anything that is moves, or is supposed to move, on the bike, you can get more informed opinions from members here. You mentioned that your husband rides, have you or he done your own repair and maintenance work? Do you own bike tools like metric allen (hex) wrenches, wrenches, screw drivers, etc?
Articles About Bicycle Repair = good info
Once you know what you are getting into, you can decide if the value of the bike + sentimental value = the cost of repairs.
If your bike is as neglected as it appears from your OP, you may want to consider a complete service package from your LBS. This typically includes cleaning, lubing and adjusting of all working components, lubrication and adjusting of all bearings, and a complete safety inspection. Costs in my area run from $60 to $100 + parts if needed. If you are so inclined, a bike co-op will provide you with work space, tools and expertise for you to learn to DIY. You mention that the "gear shift is completely worn and needs to be replaced". How many miles did you put on the bike? Are you sure it is wear and not just lack of maintenance and neglect? Often shifters, cables and deraillers get sticky or out of adjustment and can be rehabbed with a bit of cleaning, lubrication and adjustment.
The more of the work you can do yourself, the better cost wise, but savings may be offset by the need to purchase tools and supplies to do the job if you don't have access to a co-op. Here are a few other tips to save a few $$$:
- Bike shops often have bins of nearly new seats that have been removed when customers upgraded. Most are lower end stock seats but are very serviceable. I've purchased several for $5-$10 for bikes I have rehabbed to sell or for other people and you couldn't tell that anyone had ever sat on them, and they may not have. Occasionally, you will find higher end seats that just didn't work for a particular customer and are being sold at a substantial discount.
- Bike shops usually have packaged higher end cable replacement kits on display but for a lot less money, you can buy bulk cables and cable housing from the shop. While you might not want these for a high end road bike, they are perfectly good for the vast majority of non-competitive riders. Beware of the extremely cheap, one-size-fits-all cable packs from WalMart or other big box stores. They are adequate to keep a low end kid's bike working but they are prone to rust and poor shifting/braking performance.
- Expensive inner tubes are not necessarily any better than lower priced tubes. Everyone has his/her preference, but unless you are looking for thorn-resistant or ultra lightweight tubes, the only things you need to worry about are size and type of valve (Schrader or Presta).