Agree with hef. You should use the most up-to-date encryption your router supports. You should be safe with WPA, DO NOT USE wep if you can avoid doing so, pretty easy to get through now adays.
Steps to follow:
1) log onto router
2) change router password and login (some won't let you change login just password) to something strong like A456k2 (mixture of letters, numbers, symbols, and it isn't a recognizable word)
3) change the router IP and the IP it leases out. Do something weird like 32.120.1.8, something real goofy and not default
4) log back in b/c it will probably need to be reset. Now setup wireless to use WPA or WPA2
5) choose a strong password, again using letters, numbers, and symbols
6) change the SSID to something weird, again nothing guessable
7) mask the SSID
8) write this information down and tape it to your router. You'll end up forgetting some of this and you may need someone to help troubleshoot