I get home PC security questions all the time.  So, I figured I would post my opinion on various methods for protecting your PC from viruses, spyware, etc.  First off, I by no means endorse any pay for security suites except for one situation; and that is if you're grandma is using a PC.  They grew up in a non tech age and if you don't want to be running over there every 10 minutes (which may happen anyway) just throw Norton or Trend on it.  Set up auto updates and daily scans.   Set it and forget it.

Now for the more knowledgeable user let's look at some other configuration scenarios.  This is not to be intended as a "Greatest Ever" list you would see on Digg.  These are simply the tools I use and have proven effective.

Anti-Virus

Clamwin

Spyware Protection

Spybot Search and Destroy, Spyware Blaster, Ad-Aware

Hardware Firewall

Linksys Router

Software Firewall

Comodo Personal Firewall

Internet Browser

Firefox

Downloading

Use Common Sense

Now, in using these utilities, you're not necessarily be able to "set it and forget it".  I set a day either Saturday or Sunday when I go through my system and update and/or run scans with each of these programs.  Sure it may not be as "user friendly" but since I am a geek ...

Clamwin will do auto database updates, but does not yet currently provide real-time protection.  You can also set it up for scheduled scans.

You can the scheduler scans in Spybot Search and Destroy via Windows Scheduled Tasks as shown below.  I manually run a scan maybe once a week or so.

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I manually update Spybot once a week as well.

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Spyware Blaster I update manually once a week.

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Updating Ad-Aware.

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A hardware firewall.  This is much more secure than a software firewall IMHO.  You can pick up a decent Linksys router for $50.  If you're broadcasting wireless make sure you use WEP as a minimum (WPA2) is much better  ... and do not broadcast the SSID.

B00007KDVI.01.LZZZZZZZ

If you don't have a hardware firewall use the one built into XP or Vista as a minimum.  For more control over outgoing traffic and programs trying to phone home, I recommend Comodo Personal Firewall.

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Finally, use common sense.  Don't open e-mail attachments from somebody you do not know.  Make sure whatever e-mail client you use has an updated SPAM filter.  Keep your version of Windows up to date with Auto updates - (though you may want to exercise caution on Vista by manually updating it.  Wait a couple weeks before installing the latest updates just to see what problems they may cause).

Always scan any file you download before opening it.  Especially if it is an executable.  If a virus is contained your virus protection software will let you know.  Forget about P2P networks such as Kazaa, Bearshare, Azureus, etc ...