My default setup these days (including all PCs at my dev office):
- Firefox, running Adware blocker + script blocker
- Thunderbird (+ Sunbird) for email client, including PGP encryption on all internal machines. Does an *awesome* job handling SPAM.
- Full firewall, provided by DSL modem directly (ports opened as required)
- Spybot S&D, installed/run on all systems (weekly full scans, regular updates)
- WinPatrol, installed on all systems. Awesome for monitoring what is running - and identifying dodgy software (and removing it). Saved my butt a few times.
- AVG (or other solution) - now free for "home" use. Free daily upgrades. Always running in background, daily scans during lunch (or overnight).
- Subversion (data repository system) running on all critical/important data. Allows for reverting/updating of files, logging, etc.
- Daily backup of subversion repository (just to a zip/rar), then copied across network to another PC - and burnt to CD/DVD once per week (or more often).
...
Total cost of software: $0
Make sure you turn Windows Firewall OFF, and disable the other useless features.
And just don't install/run dodgy software. If you do - nothing will ever save your system. Its good to have a non-networked machine just for this "dodgy" stuff if you need to run it (i.e. keygens). Run from USB, burnt CD (R/O media). Be prepared to reformat machine regularly.
Also useful to have some backup/restore tool for the Windows registry. That is where a lot of the mess happens these days.