It wasn't immediately obvious to me how to create a local login, so I wrote it up here to help you, Oh Internet Person.
Step 1When you get to settings, it doesn't matter if you click Use Express Settings or Customize. Pick what makes you happy.
Step 2Setup will ask you to Sign into your Microsoft account. You can, but you don't have to. You can also click "Create a new account" at the bottom. You can click there to create a new online Microsoft account, sure, but this is also how you create a local account.
Step 3At this point, it looks like you'll need to Create a Microsoft account, but you can also click "Sign in without a Microsoft account."
You should really know what you're doing here. Don't just do this because you don't like the idea of a Microsoft account. Be aware of the ramifications. That said, you can always add an account later. I found using a local local to be better for me when making a Virtual Machine.
Step 4Here's where you actually make your local account. Put in a user name and password like you always do. This is a local account that has no ties to the online world.
Hope this helps someone.
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About ScottScott Hanselman is a former professor, former Chief Architect in finance, now speaker, consultant, father, diabetic, and Microsoft employee. He is a failed stand-up comic, a cornrower, and a book author.