The number one question I am asked on the subject of computers is about virii and spyware. This is my definitive answer. There are 3 steps to staying safe:
1) Prevention. Get firefox or opera now. These browsers are safer than IE at the moment. In addition get Adblock for firefox.
2) Best surfing practices. Don't go looking for porn or illegal shit. Don't visit Dr. Lohit Ramindeep's Viagra store. Don't go on any websites for sketchy stuff. (Sorry dude, but it's not a free ride.)
3) Protection. Go here and get the virus and spyware programs. Pound for pound, AVG is the best stuff around. They update themselves once a day, run without prompting, and scan your email client for incoming and outgoing viruses.

Do these three things and you will be smooth sailing malware wise on the cheap

Hackitude: Free ESSENTIAL PC Software