Click the PSI Buttom at the lower left of the main PSI Window.
Click 'Options'.
The following are what Option Groups ( along left of Options window ),
followed by what to do inside that group.

Option group    -> Option ( Location of option in window )
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Events          -> "Enable popup notifications"  ( Lower 3rd of Window ) 
Appearance      -> "Small group headings in roster"  ( Top of window )
Roster Iconsets -> Services tab at top -> "Use transport specific icons for contacts"  ( Top of window )
Sound           -> Uncheck "Play sounds when Away/XA" to preven being awakened by your computer  ( Top of window )
                   when someone sends you a late night message
Advanced        -> Change the "Treat incoming messages and chats as:" to "Chats" ( At bottom of window )
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Click OK