First off, you should always back up your data in another place. Keep it on DVDs or an external hard drive or even a online storage service. In this case it's definitely a good idea to backup your data beforehand as you're upgrading.

Last week I suggested iBackup for your photos, but this can be used for any and all your files. If you want to backup everything all at once go to disk utility (applications>utilities>disk utility). Make sure you have somewhere else to backup your data because this is going to be a biiiig file. Click on your hard drive, click new image, name it something, and save it somewhere OTHER than your current hard drive. Unless you have more than half the space free on your hard drive free you need to save it in a different location. Once you've upgraded your operating system you can restore your previous hard drive from disk utility. I don't suggest this method, but there it is.

You shouldn't have to worry about losing anything when you upgrade! OS X was built to be backwards compatible. All your files and settings will carry over to the upgraded version. Backup first just to be safe, but then go ahead and stick that install disk in and get running the latest operating system! If you're still nervous please take a look at Apple's installation guide for 10.4 Tiger. Tiger_Install_Setup_Guide.pdf

I've heard a lot about Leopard. Should I buy a computer now without it? What happens to my stuff if I upgrade later?

If you need a computer now I would go ahead and get one. Especially a iMac or Mac Mini. They've just been upgraded and now's the time to buy. That being said, neither of these computers will probably be upgraded before October (Leopard's release date). You will definitely want to get the new operating system when it comes out. I've heard everything you probably have, and it sounds like it is going to be a worthwhile upgrade once they're finished developing it.

Like I said in the first item above, you always want to back up your data, but any upgrade to the operating system should be just as seamless as any upgrade/update you receive from Software Update. You don't need to worry about losing settings or data because all versions of Apple's operating system are backward compatible.

I'm regularly faced with the same issue. I produce too many files for my hard drive to store all in one place. I have a couple external hard drives set up to take care of storing my files. When I reach a point where I've finished a bunch of projects and I don't need to access those files anymore I copy them to a hard drive and delete them from my Mac. I only keep files with me that I constantly need access to.

That being said, this isn't be best solution for everyone. You may need access to too many files than what fits or you might not have a big enough hard drive to fit everything you regularly access. I'm going to lead you through a few things I did to free up space and organize my files much more efficiently. One good practice to keeping your mac fast and agile is to leave at least 10 gigs free on your hard drive. OS X uses this space as virtual memory, which is vital to allowing programs to run quickly.

Properly named Monolingual is my first secret. It's a program definitely not recommended by Apple, but it's a great tool for freeing up some much needed space. Just realize that if you're stuck in Albania with just your mac and your wits the locals won't be able to change the language the Albanian and use your computer to navigate you back to the airport or your favorite Albanian restaurant.

Another thing you can do is clear the safari/firefox/etc cache and history. This might not free up too much space, but if you haven't done it in a while you could get up to a gig or two in free space.

If you have a large itunes library you can check for duplicate songs. In itunes click View>show duplicates. Don't delete all of these. You will be shown every file that has a duplicate and its duplicate. For example, if you have Devil's Dance Floor by Flogging Molly from both Drunken Lullabies and Whiskey on a Sunday they would both show up in duplicates, but you would definitely want to keep both of them.

Delete old programs. There are a lot of people out there that downloaded the latest demo version of Photoshop, Illustrator or some other program. You can delete these programs and free up a ton of space.

If you need to keep some files on your computer, but don't access them regularly, you can create archives of them and delete the original files.

Finally, make sure you always empty the trash. iPhoto, iMovie, and Garageband (among other programs) have their own trash cans for you to empty.

Now for some practices on keeping backing up your data. I always suggest if you're backing up your data to save it in more than one place. You never know what could happen, but if you have it in two places you can almost never lose both at the same time. If you're running out of space, though, it's a good idea to get rid of it on your hard drive and just keep a copy on your external hard drive. You don't need to have an external hard drive, though. DVDs and CDs work great for making extra copies of your files and it's a lot harder to lose data when it's on this type of media.

In the end, get rid of it if you don't need it. There's no point in keeping anything you'll never use again.