(almost) Full disclosure before I start: I work in the online ad industry. The company I work for doesn't do any of the behavioral stuff I talk about below, but I'm far from completely removed from the subject matter.
So Google is gonna target ads based on user behavior. The only surprise here is that they haven't started this already. The cool bit, though, is that they're going to give you access to YOUR user profile. This means you can log in and execute the digital equivalent of saying "Oh. My. God. I am SO not into cheerleading anymore! Do NOT show me cheerleading ads, Google! For serious!" This is also the legal equivalent of Google saying "Ha ha Congress, you don't get to lecture us about user privacy!" (See Google chief council Nicole Wong, pictured left, bearing her teeth at any congressmen that were tempted to pretend they understand what the hell they're talking about).
The win here is that you don't get ads that mean nothing to you, but you can control what the advertisers understand about you. THIS IS THE RIGHT BALANCE OF INTERNET PRIVACY PEOPLE, and you should use it to its fullest. In that vein, here are a couple of interesting links to help you sculpt the digital version of you into exactly who you want that to be:
Google Ad Preferences Manager: The Goog tool for profile management. It's probably a little slow today, and chances are you've not been tagged yet (it's an incremental release). Keep an eye on it, though, and remember - if you log into Gmail, Blogger, or YouTube, you automatically have a Google account (and you told them it was cool to keep an eye on YOU). See also Google's catch-all Privacy Center.
Network Advertising Initiative Opt-out page: A load of ad networks participate here, you can see if you've been cookied by them and opt-out of any targeting they're doing based on your behavior.
EFF's Top 12 Ways to Protect Your Online Privacy: the EFF is the ACLU's smarter and more reasonable younger cousin. They've been around a while and do good work... like this handy guide (which has a bunch of useful links itself).
Don't be the silly people that say that any online tracking is an evasion of privacy... but don't be that guy that never deletes his cookies, either. Read those little pamphlets you get from Verizon, or AT&T, or Comcast, or whoever does your service provision in that world. If they don't make sense, call and make a person explain it to you. It shouldn't be up to Google or Congress to do the work for you... be as private as you like because you're smart like that.
At HRTotM, we don't collect any of your personal information, and wouldn't use it anyway, unless you're especially attractive, in which case we might divulge at a party that "this totally hot chick" left a comment on a post, and further use that as some indication that our wit is worth notice.