While the effectiveness of software firewalls is up for debate (I personally like Windows Firewall included in X, Vista, and 7!), a hardware firewall is a must. Even something like a $20 bucks super cheap router that might just fall apart in the next ten minutes will give you superb protection with its hardware firewall.
Maybe you don't "need" one, but sure you'll "want" to have one around. It's just an additional layer of protection between the computer and the outside world, like an antivirus tries to protect from known malware a firewall monitors connections and drops those that aren't supposed to happen.
If you have a NAT router (most likely you have one of some sort) you already have a strong protection from it, as it blocks all incoming connections from internet (but not from local network though). Software based firewall are best for handling outgoing connections, as they can filter by more criteria and allow only specific programs past it.
The built-in Windows 7 is nice, but lacks some features that make third party alternatives a best choice. I'm using it and already want to try something else.
We have the built-in firewall on our home router, but many times my laptop travels with me. Even though I'm cautious. when on public networks I rely on an up-to-date firewall and MSE. I've had very, very few problems with this installation of W7, even though it's been in use for 18+ months.
The Windows 7 firewall default settings just block inbound. Setting up outward control is a bit tricky, so most people don't bother. I use a free program from Sphinx that makes controlling outbound settings on the Windows firewall easy. Just like Zone Alarm etc, you have to click yes/no the first time you use IE or whatever, but once setup its ok.
: Sphinx Software
It all depends on the user,if you believe you don't need it then don't use it. I myself am a comodo firewall user and that works great even though I think other wise. I have a friend who is more techy then I am overall but refuses to use a AV because he believes he can do fine without it. He got infected about 4 months ago. He dug into the registry himself and removed it,he said he tried malwarebytes and a free av and they couldn't remove it but he was able to disable it then delete it himself. Then he did a quick scan anyways to make sure and he says his machine is fine.
Anyways what i'm trying to say is that everyone has their own ideas and can choose what to do with their machine. So all and all I would say it is better to have some type of firewall but you can choose not to use on and that would be just fine just like my friend choose not to have a anti virus and still hesitant to get off xp even though he has 7 on a partition installed,very end user.
In my opinion we should not be advising others that running without a firewall or AV is okay.
The best practice would be to keep Windows Firewall turned on and fully updated, with at minimum Microsoft Security Essentials.
Since these work nearly perfectly and block most trouble without interfering with performance in the slightest, why not?
Look at it this way, you're going onto the net...where there are large amounts of files just waiting to get into your PC, do some damage & try to compromise your personal data, as well as invite others in to play. No doubt about it, the net is a hostile environment chock full of threats. And it's getting worse every day, new variants of viruses/malware are released every day, sometimes every hour. You'd best suit up with all the preventative measures you can find.
Consider a firewall a part of the other safety measures you employ, leaving one less opening in your defenses.
I did the same just like your friend when my last PC got infected because of my friend [he was using my laptop to check onto his emails], I have dig into the registry to find the "bug". As i said earlier even I have been using Comodo since 2005 but was just thinking off lately if I should try Windows Firewall over Comodo.
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