In addition to rojash's correct answer:
If or when you upgrade it is not your programs that will need backing up but your photos, documents, music etc., basically everything that is important data that is unique to you. To be copied onto your new system.
You should keep regular backups of these files anyway on DVD or external hard disk as your current hard disk could stop working at any time and, depending on the fault, you could lose everything on it.
Any external 1 Terabyte disk drive from PC world or the like will be good enough for what you need.