We're currently using self-directed Mail Chimp.
For us it's very easy to design and send e-mail, and the program does a good job of helping you avoid spammy titles, tracks opens and click-throughs, and automates the opt out for people that don't want your mailings. It keeps you from being labeled a spammer. Mail Chimp is free for a database of under 2,000 subscribers and you can send 12,000 messages per month for free.
Once our in-house system is updated we'll be doing it on our own, but Mail Chimp has been a great way to learn best practices.
PS: Even if you decide to do it on your own, take some time to read the Mail Chimp knowledge base articles.