I personally would use photoshop and after effects both by adobe to get this done. The adobe video collection professional contains both of these as well as some other kick ass programs for getting your video work done.
I highly suggest going out and picking up a copy if you plan on doing video work in the future.
It can be purchased here.
http://store.adobe.com/store/products/master.jhtml?id=catVideoColl
I'm sure there is freeware available but I don't know what to use for that type of stuff that is as good as the adobe products. Don't worry I'm sure someone knows.