Step 1. Create free wordpress account.
Step 2. Create the wordpress blog and optionally select a wordpress theme or template.
Step 3. Login to your hosting control panel or GoDaddy account.
Update nameservers to point to wordpress nameservers.
Fig 1. Update wordpress name servers (ns1.wordpress.com, ns2.wordpress.com)
Step 4. Purchase wordpress credits in your wordpress global dashboard | Upgrades
Step 5 . Upgrade your free wordpress blog to use a domain. This will cost you 10 wordpress credits. You can pay for credits with paypal. or credit cards. After you have made your purchase you can spend the credits by adding a domain as in fig 2.
Step 5. Enjoy your wordpress domain name