I can explain to you what I do. I do not make the most fancy thumbnails, but I think they are decent.
I use Panzoid. Just go to panzoid.com and there are many things you can edit. You can put different images and texts there. Now, it is not the best, but it is free, so that is an advantage.
Also, for better thumbnails you can use GIMP. It is a free sofware you can download. You can do more with it, though I personally was never able to figure out how to use it properly. Though, with the patience, I am sure it is easy once you get the hang of it.