I have an external hard drive that I keep all of my scrapbooking "stuff" on. I do this so that the enormous amount that I have will not slow down my pc! I also back that up with cd versions that are stored in a safe deposit box.
As far as my kits, I purchase from several online sites so I have a folder for each site. Inside each folder, I have sub folders for each designer from that site. I also keep the "read me" files with that kit so that I can give proper credit when uploading a layout.
Hope this helps...keeping your file on your computer, an external drive, or an CD is really a personal choice. If you have them on a CD, you don't have to copy them back to the PC to use them. Just use them right off of the CD!
There are plenty of ways to keep your files. You just have to find one that suits your style and personal preferrence!
Good Luck!
