The Gimp is an open source (free) product with lots of features, but if you want to use Adobe, Photoshop Elements 9 does everything that most people need (more than the 'full-fat' version did a few updates back!) for £60 or so and all the files are compatable.
You can download any of the Adobe software from their site on a 30 day trial, and then buy a copy to obvtain the serial.