I am trying to add text to an image in Photoshop by adding a layer.
When I add the text in the layer I am left with a "wavy" image that I can't do anything with and if I attempt to save it the text is missing.
There is obviously a simple way to "set" the text layer but it eludes me - can anyone give me some simple instructions of how to set the text please.

Thanks.

That's pretty odd. I can't say I know what the issue is unless I see it!

So if you copied and pasted the image into a new document, pressed 'T' for the text tool and clicked on the canvas to insert your text, type in your text, it will create the new layer for the text automatically, attempt to save, do you still get the "wavy" image? Do you have anti-aliasing on?

That's pretty odd. I can't say I know what the issue is unless I see it!

So if you copied and pasted the image into a new document, pressed 'T' for the text tool and clicked on the canvas to insert your text, type in your text, it will create the new layer for the text automatically, attempt to save, do you still get the "wavy" image? Do you have anti-aliasing on?
See attachments:-

1 = image with text layer.
2 = image prior to saving.
3 = result of saved image.

Is that a .gif or indexed color file you're editing??? That's the only reason I can think why you get the pink background in the first image ;)

No, the image is a .jpeg which I load from a file and then click on "T" to add text.

Go to Image>Mode and make sure it is set to RGB color

RGB Color
8 bits/channel

Well, I don't know how to help you because the "wavy" effect is the result of putting text on a indexed color image. Sorry.