I keep all files on a password-protected portable hard drive and backup all of my files to a SEPARATE portable hard drive weekly. There are NO client files resident on my computer - only software (this is protection against theft as well as, say, a house fire).

The second hard drive is kept in a safety deposit box at my bank. Every Friday after work I take my laptop with the primary hard drive to the bank, get the backup drive out of the safety deposit box, complete a backup of the new files onto the second drive and then put the second drive back in the safety deposit box.

Sounds like a pain, right? BUT - my bank is 5 minutes from the house and it would be fairly easy to replicate a week's worth of files. The whole process takes less than 30 minutes/week and means that I won't lose client data should something happen to the laptop (theft, fire, hard-drive crash, etc.).

I also keep the software disks in the safety deposit box. On the rare occasion that I purchase downloaded software, I download the .exe file to my desktop and then burn a copy to a cd-rom for backup and place it in the safety deposit box, as well.

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Lily Chambers, The Virtual Office Goddess, LLC
Author "How to Do Your Own Small Business Bookkeeping"