Hi Kathy Simon,
First: a Welcome Aboard the Camel!
Your question:
If you are ready to go digital, under $400 buys you a nice 'compact camera' or Point-and-Shoot' camera: basically a small camera with a fixed zoom lens.
The number of pixels it has determines how large you can print your images without loss of quality, basically a 4 MP camera is excellent at A4, and good at A3 size, a 5/6 MP camera is excellent at A3 size, and good at A2 size, etc... the more pixels, the larger you can print.
For everyday use a 5/6/7 MP camera will be plenty, the more the merrier, because then you can crop off a part of the image (that you don't like in hindsight) and still have enough pixels 'left' to get a decent print.
In a camera under $400 *I* should look for best image-quality, but this is very personal: some want a specific formfactor (needs to fit a cigarette box to be able to take it everywhere), others want the best moviemode, and some might want the largest zoomreach available (goes from 'standard' 3x up to 12x).
And about 'moviemode': all the compacts have it, some better, some worse
I hope this helps some, as because you ask such a 'broad' question, it is hard to give a more detailed, more specific reply.
But if you have further questions, please never hesitate to ask them!
...and as always, all the above is just *my* €0.02 worth of advise...
My kindest regards,
Max@Home