For understanding of spoken German, I have gotten a lot out of Deutsche Welle's Learning German podcasts. It includes series on particular vocabulary, as well as the Langsam gesprochene Nachrichten. I find I can now listen to that one on my iPod's double-speed setting. It's no good for Umgangsprach, but great for vocabulary, learning what is going on in German politics and society, etc.
I agree with the other answerers on the value of conversation with native speakers. I found it useful to be in situations where I wasn't too worried about getting every word right. For me, that was in noisy bars after a couple of beers. I am quite certain my spoken German is better under those circumstances! It is important not to switch between languages in the one conversation, or you will keep thinking in English. At some point as you improve, you will suddenly realise that about twenty minutes previously, you stopped thinking of the English and translating, and you'd been producing spoken German directly instead.