you can get a good external hard drive for around $100 ... less depending on how much you need to back up. also, depending on how many files you need to backup you can just put them all on a cd or two... or some dvds.
personally, i keep an internal storage drive that way i can wipe my system drive spontaneously if need be. haven't done so in quite some time though... even though it seems to need a fresh coat of windows.