Final Image Preview
Magnifying Glass Image can be found here
Text Background image can be found here
Step 1
Go to File > New (set the settings to match the picture below)
Step 2
Add your image or text you want to apply the Magnifying Glass Effect to.
Step 3
Go to Layer > New > Layer
Click ok
Step 4
Select the elliptical marquee tool and draw a circle on your image or text where you want your Magnifying Glass Effect.
Now colour the circle in black.
Step 5
On the layer your created right click on it and go to blending options
Set the setting to match the below pictures
Inner Shadow
Outer Glow
Bevel and Emboss
Stroke
Step 7
The circle you created in step should still be selected.
Now click on your image or text layer and go to Filter > Distort > Spherize
Set the Amount to 75%
Then you could add a Magnifying Glass frame around the Circle.
Final Image
