By far the greatest threat to PC security is a bored teenager who is fast on the keyboard (as they all are) and clicks on EVERY link on EVERY website without even seeing what it is (which most of them do).
The PC will be virus/trojan ridden in days no matter what precautions are taken.
Basically, you can't let kids onto a PC used for something serious (like online banking).
Don't ask me how I know
After that....
Disagree re software firewalls; most are useless. The NAT protection which every router has will protect you from outside attacks. Only YOU can protect yourself from inviting bad stuff into your PC though, by clicking on infected websites, receiving infected emails, etc.
I'd suggest
1) using a router, just just a modem
2) running up to date antivirus software
3) applying every Windoze patch as it becomes available
4) configuring email software to NOT automatically execute attachments
5) if possible, not using Micro$oft email software
WEP security is weak but who is your enemy? If it's Granny Smith, or some perv looking for a free connection while parked outside, it's good enough because they can get connected from the house opposite
If it's the KGB then no... WPA/PSK is strong, with no published attacks that are anywhere near practical.