Like many experienced computer users I've long since grown tired of the excessive system load imposed on my PC from full-suite security software such as Norton & McAfee, so when Windows 7 came out with the free Microsoft Security Essentials, I gave it a try. I found MSE to be fast and effective, hardly slowing down my PC at all.
So for the last few years, my standing recommendation has been to install Microsoft Security Essentials, keep Windows & key apps like Acrobat and Flash updated, and to pay careful attention to what you click on (don't click on attachments sent to you that don't look kosher, and be careful when clicking through installers to not catch unwanted tool-bars and other crap-ware while installing a program you do want).
However it seems that Microsoft hasn't been keeping up with the hackers and criminals. As reported by HowToGeek last year, whilst MSE topped the performance tables in 2009, since then it has slid down the tables.
So what do I now recommend?
A recent article on Lifehacker pretty much nails it..
avast! Free Antivirus
First - you need a basic free always on virus scanner - and you won't go far wrong with Avast Free. Whilst it isn't the top performer in security, it it one of the best at not slowing your system down. It does come with a plethora of annoying popups and sounds, but Lifehacker tells us how we can configure Avast to mitigate them.
Other options can be found on Lifehackers's best AV application for windows article.
Second - I'd recommend an on-demand scanning tool that can take an occasional deeper look at what's on your PC (especially if it starts behaving strangely) - and one of the best on the market at the moment seems to be Malwarebytes Anti-Malware. They have a free version that's fine for on-demand scanning (which is fine as long as you remember to run it every so often) or the Pro version is only $24.95 for a lifetime license (no annual update fees!)