Precaution while using WiFi
There are several open source software that can encrypt your files as well as entire hard disks. I suggest TrueCrypt, a free software that encrypts your entire hard drive so that none can access it without breaking your password. So if you are using encryption, use a good one, create a good password and do NOT forget the password else it will be trouble decrypting. Bitlocker comes with Windows 7 and provides encryption to each of your hard drives and partitions. You may set up BitLocker to decrypt the drives automatically or using a key. Here is an article explaining Bitlocker In Windows 7.