Remember that plain email is not completely secure; it may be read by anyone listening on the networks that the email passes through. This is true for most of the traffic that passes through the Internet. It's possible to use a program called a Packet Sniffer to listen to all the data passing through a particular area of the network, and unless your data is encrypted, it will appear as plain text in this program. There are ways of making email more secure, using an encryption package such as PGP (Pretty Good Privacy), but they are often tricky to use.
There are a few things you need to remember to stay safe with email:
Don't trust the sender's name, as it can be “spoofed”.
Never send passwords or credit card details using plain email.
Never open unknown attachments. Viruses are most commonly spread through attachments that install rogue programs when opened.
Be careful of clicking links in HTML emails, or at least check where the link points to by examining the HTML. Misdirected links are the most common form of phishing “bait”.
Make sure your email reader doesn't automatically open HTML mail or images. Often, opening images on junk mail can send an indication back to the bulk-emailer that your email address is “active”.
Choose a sensible password for your email account (i.e. not a common name or disctionary word, preferably a random string of numbers and letters), and use a secure mail program if possible.
Keep your virus checker up to date (you do use one, don't you?), and
visit http://update.microsoft.com/ regularly and download/install
any critical updates.