This is part that we don’t want to think about: What if the worst should happen. Let’s say that someone breaks into your house and takes your computer. Can you replace your data? Keep in mind that while having your house burglarized is traumatic (been there, done that) the computer may contain stuff that cannot be replaced. Can you buy a new computer and restore your data? If you have an external backup then you can. This brings up another critical point, namely, at least one of your backups MUST be off-site. I use a safe-deposit box but you could store an external drive in a locked cabinet in your office or at someone else’s house. You could also use web-based Cloud storage since that is offsite (and backed-up at the server farm). If you have all your backups at your house and you have a fire then those backups could be lost forever. This is CRITICAL.
What if you have not backed-up your data and your computer dies? There are still some options (no good option, but options nonetheless). Normally a computer fails because the hard drive failed or the motherboard failed. If the drive is intact then a technician can normally remove the drive and retrieve the data. You can also buy a cable kit that turns your internal computer drive to a USB drive. I have one of these in my computer emergency kit (the same way I have jumper cables in my car emergency kit). Sometimes you can even install the old drive into a new computer.
A failed hard drive is very bad because the failure can corrupt your data. If the drive really got fried then you can do a “clean room recovery.” This is the worst possible outcome. With a clean room recovery you mail the drive to a company that removes the magnetic platters inside the drive. They install the platters on special drives and attempt to read the data. Since the drive is sealed to eliminate contaminants it must be disassembled in a NASA-like clean room. This is expensive (can cost several thousand dollars) and you will almost certainly have data loss and corruption. Much better to have a simple backup and archive plan in place to avoid these problems.
The key is to prepare for the worst so that the worst will not happen. Your data is critical — be sure to protect it.