With Avast, there's a pre-boot scan. If you get infected, they'll usually get a signature within a few days, particularly if it's a widespread infection and someone uploads a sample to one of the many virus sandboxes. At that point, update the database, schedule a pre-boot scan and Avast runs before the malware does.
Of course, not all malware can be removed and not all malware is designed to be inobtrusive or merely annoying. Theres a (thankfully) small class of malware, sometimes called "ransomware" that actually encrypts your files using strong encryption (the kind used to secure online transactions, healthcare data, and credit card merchant transactions) and asks you to pay up before you get access to your files again. There are other types of malware that are designed to cause data destruction. In these cases, even the best AV won't help you return your computer to normal.
So what then?
Insurance! (backups and archives)
Start with archiving all the stuff that you want to keep "forever" (note that optical media degrades and requires periodic re-copying every few years). These would be your pictures, documents, artwork, *cough* mp3 collection, drm keys, anything that would be difficult or impossible to get again.
Then make an investment: two external hard drives, about 1-1.5TB in size (this should run you about $250-300 USD).
There are a few legally free Linux live-cds that will allow you to boot off of the cd and make an image of your internal hard disk to a /file/ on the external one using ntfsclone or partimage. This is your backup. Alternate between external drives each time you backup, and dump the entire hard disk to a new file on the drive. When you run out of space, delete the oldest file. Most imaging utilities will create a file that is only as big as the used capacity of the source disk (so if you have a 500GB disk with 50GB used, the image file will be 50GB).
When you get all f'd up from an infection, you can take the latest non-infected image and restore it to your internal hard disk, usually in a few minutes to a couple hours of unattended activity (any non-archived data that isn't in the image will be lost). You have two external drives and alternate between them so you're not completely screwed if one should fail after being dropped on the floor.
Of course, if you don't care about reinstalling drivers and patches, you can just do the archiving and reinstall. Taking images as described above will get you back on your feet much faster, although, the learning curve is a little steep.