Most people don't consider or think about backing up there system, however it is very important due to a threat of a virus, hard drive failure or natural disaster. Especially if you create and do a lot on your PC like documents, have digital photos, create graphics or shoot video. One copy on the C drive of the PC its on is NOT enough and is subject to be lost if any dreaded event occurs, the key is to be prepared and ready for when it does then it won't be painful. You should have 2 to 3 copies you can do this by getting a external drive or 2 and couple of rewritable(-/+RW) blank media DVD's. One on site and one off site like the office or friends house, we do this here at Berntech.
Your Data: This is the most important stuff you should be backing up often, it is not that hard to create a backup system in place. First pick or create a folder on your Windows C: drive you can use the standard "My Documents" that Windows provide or create a new folder of your own and have it anywhere you desire and save all your data there this way its all in one location. Then use a sync software like SyncToy from Microsoft its free to sync to external hard drives and CDBurnerXP free also for burning files on to blank optical media(CD/DVD) screen shots below.
Depending how often you create data you should go back and update the backup so that you data backup is kept current, do it daily or weekly.
Your Windows and Applications: As far a the rest of the computer when you buy a computer if the computer had recovery disc save and keep them in a safe place for when you need them. If your new PC did not come with recovery disc you can make them. Immediatley make them, Windows 7 has a built in image software, otherwise there are other 3rd party software ultiliities to do this. This will take a image of your entire hard drive and you can save that compacted file to your External Hard Drive or a blank DVD. Once you have that you can restore the computer back the way it was at the time of the image was taken.
As far as any applications not already installed when you got the PC, backup or get the install files for those programs and save them in your data backup folder as well this way you can reinstall those after you have restored your system from an image. Below is a screen shot of Windows 7 and the location in the Start Menu of where the backup and image software is the folder "Maintenance"