Step 1 - Open Your Canvas
Open up a new document, Size: 500x500, Background: #FFFFFF (white). Now make a new layer. To do that navigate your mouse up to the toolbar and click ''Layer>New>Layer..." in the name field type "Clip1" and click on the "Ok".
Step 2 - Rounded Rectangle Tool
Now move your mouse your the took bar (usually on the left) and click on the "Rectangle Tool" icon. Keep the mouse button down until the icon expands and click "Rounded Rectangle Tool".
Step 3 - Rounded Rectangle Settings
Move your mouse up to the options bar and in the "Radius" box, type "25 px" without the quotations. Make sure your foreground color is set to "7D7D7D" and draw a rectangle on your canvas like show.
Step 4 - Select The Paperclip
You have now made the frame work for the paperclip! You should feel happy :D Hold down your "CTRL" key and click on the layer called "Clip1". Your image should now be outlined in dashes like this.
Step 5 - Delete The Excess
We are now going to delete the center. To do that move your mouse up and click "Select>Modify>Contact" in the box type "3" and hit the "Ok" button. Now press "Delete" on your keyboard. Your image should look like:
Step 6 - Select a Few Pixels
Right here it would help if you would zoom into your paper. Click the magnifying glass (on the left in the tools menu) and then click the center of your paper once. Now that you are zoomed in select a few pixels on the left side like shown.
Step 7 - Move It
On your keyboard press "V" or click on the "Move Tool" on the left. Now slide it slightly over to the right about 2px by using the arrow keys.
Step 8 - Left Side
Select the pencil tool and draw 3 lines downwards so you end up with the following result. This is the left side of your paperclip which should be right where you moved the last part from in the previous step.
Step 9 - Add Some Style
Basically done! However, we're going to add more of a metallic look to it. Click "Layer>Layer Style>Inner Shadow" and apply the following settings shown in the screenshot.
Step 10 - Make it 3D
Now on the left click "Bevel and Emboss" in the same style window and apply the following settings shown in this screenshot. This will give your paperclip a more 3D look.
Step 11 - Your Done!
Your paper clip is now done! :D Now you can implement it into any design you've completed like I have here, displayed on attached to a piece of paper (image scaled down to fit).