Whiteboard & Miniatures
I got a fairly large Whiteboard (4x3'), then took a crafting knife and a large ruler, and carved a grid into it (each square is 1x1"). For a board that size it took about four hours. If you used a 2x3 board instead, you could do it much, much faster.
If you do not want to carve into the board (because you want to use it for something else), you can use thin tape, or magnetic tape to get a similar effect. It may also be possible to find a board that has a grid already on it for you, which would be faster.
So, I've got a grid now. I can use the whiteboard to draw terrain like walls, rivers, or the smoking ruin where the Fireball hit. The really nice thing is that whenever I erase things, some of the marker goes into the grid grooves I carved out with the knife, so they turn black and get easier to see.
Players also like to use the edges of the board to track things like temporary buffs or anything else that needs writing down for the duration of a combat. Pass a marker to everyone and have fun!
To represent players and NPCs on the board, we use miniatures. Those can be bought online if you want nice ones, or you can use simple folded paper printouts of character portraits. When someone moves, we move them on the board.
Anybody looking at the board can see immediately where they are relative to everyone else, what the positioning is, and what terrain obstacles are in the way.
A big advantage to this is that it has virtually no setup time when combat happens. You don't need to know how to use software. You don't need to set up an area using 3d terrain pieces or tiles. I can draw a typical combat zone in 30 seconds, place people on the board, and we go. It's not as immersive as some of the fancier options, but if you just want to get to playing with a low time (and cost) investment, it's a great option.