NOTE: Going back to my perma-newb roots, I’ll be posting a series of quick tips I’ve picked up from über-riders that have helped me step-up my riding.
Start out about a whole bike-length back (about 5-6′). The idea at first isn’t to save energy (and at this distance, you probably won’t feel any savings), but to get used to following the rider in front of you, also known as “keeping the line”. Work on maintaining maintain a steady distance, and staying in line with the rider in front of you.
After you can follow them pretty well, close the distance to about 3-4′. It’ll feel close at first, but you’ll get used to it with practice. You start gaining the benefits of a draft (riding behind one or more riders) as far back as 4-5′, depending on how strong of a headwind you’re facing and how fast the paceline rolls. So there’s no need to get any closer than you’re comfortable.
After a lot of practice, work with someone you trust to keep a steady pace on a relatively flat stretch, and close the gap to about a foot. Here you’ll really feel the draft (especially in head-winds and/or faster speeds). Play with sliding on and off the leader’s wheel to get the feel of the draft air bubble that’s created.
Warning: Don’t close the gap on riders you don’t know! At mass start events, if you find yourself with a group of riders you don’t know, watch them carefully. They might have excellent bike handling skills, or none at all. Only draft closely to riders you trust! As your skills increase, you can trust yourself more to compensate for some bone-headed mistake, but in the meantime, why risk it?