I'm not very good at this either. My general rule of thumb, which works a majority of the time (but unfortunately not on a large minority, and I've had to just memorize some exceptions) is that a kanji standing alone, or with okurigana only, should be read as "kun" (native Japanese reading), and that compounds are generally "on".
That being said, keep this in mind (from the NTC New Japanese-English Character Dictionary, page 54a):
"Unfortunately, there is no reliable rule for determining if a character is to be read in the on or kun, or for deciding which of several possible readings to select in a particular instance. A rough guideline is that on-on or kun-kun readings are used in compounds, and kun readings in independent words, but there are many exceptions. For example, 毎朝 maiasa 'every morning' is an on-kun compound, though 毎 has the kun reading goto and 朝 the on reading choo."
So, while my little rule will work a lot of the time, get prepared to memorize a lot of exceptions. It's unfortunately unavoidable.
"you're a doctor.... and 27 years.... so...doctor + 27 years = HATORI SOHMA" - RoyalWing, when I was 27
"Al hail the forum editting Shooby! His vibes are law!" - Osaka-chan
I could still be champ, but I'd feel bad taking it away from one of the younger guys. - George Foreman