Place it where it looks good and link it to the header layer - we do this so that if you move one you move both, by linking layers together you can keep them in order easily. Add any images you plan to have in your header, try moving them about and test different positions - originally my jackalope was at the end of the header text, I think it ended up looking much better at the right hand side.Now set up your nav bar, new layer, select the area you want for it - fill it in with the colour you want, now make a text layer, choose your font and write in each of your links, try different orders to see what works best, your home link should always be first on the left, unless it's in a language where writing is read right to left. Now start over - new colour combinations, slightly different layouts and fonts, make a few different templates.
Now slice up your navigation bar, cut out each link as a slice, cut the ends either side too, to create a nice clean cutout - leave the big empty piece at the bottom there for now.
Colours You should stick to a few main colours, they should be complementary to each other and not too garish, my choices where white, black, red and a touch of grey.
Imagery In your header and background you can have images - well you can put them anywhere really, if you're going to have an image in your header I would suggest something abstract and interesting or something simple and representative of your site, like my ickle jackalope... To do this make a new file, I use 1024 X 786 for this site, because it's 1024 pixels wide.
Coming off these are sets of pages, from projects each project has a page which can be gotten to from the projects page.
(they're also linked in the sidebar of each project page but that's not relevant now) Below the contact page I've got pages for links - simply to represent that the visitor can go somewhere from there.