Hardware firewalls don't stop everything.
For example, my Zone Alarm since installation (close to two months) has stopped 478 instrusion attempts and I'm behind a hardware firewall.
Anyways PC Chillin has been a critic favourite when it comes to PC security. I myself use NAV 2004. Works for me. Daily updates if you do it manually...weekly if you use live update. I believe Norton is also what the US military uses but theirs is most likely a much more expensive Norton
Anyways to surf on the internet with no protection is suicide these days. I once had a buddy get 3,000 viruses on his PC. Seriously.
Generally this is the line of defense most people recommend:
Front line - Hardware firewall
Second line - Software firewall...you can use Windows firewall but beware because it does not stop outbound...Zone Alarm is free and it works great.
Even then viruses will get through so...
Third line - AV programs, spyware programs, popup blocker, and etc. (I suggest PC Chillin' and a combo of Spybot, Ad Aware SE, and Spy Sweeper and to use Firefox). Update Windows also.
If your neighbour doesn't want to pay just download free programs:
Software firewall - Zone Alarm or Sygate
Ant-virus (AV) - Panda's free online scan, Avast
Spyware - Spybot, Ad Aware SE
To check your firewall visit www.grc.com