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I read this on lifehacker.com. It looked like it might be important information.

Though the suggestion so far has been to save video in the DV codec, with enough video you'll need a significant amount of disk space to store it. If you're comfortable with more aggressive compression, encoding your newly digitized videos in MPEG4 or H.264 will help save a significant amount of space. Encoding at a data rate of around 2mbps and an audio data rate of 192kbps should provide you with a smaller file and a negligible loss of quality.

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Storage and Organization

If you've made it this far, we've talked about creating a ton of files. With thousands of new documents, pictures, songs and videos you'll need a plan to keep things organized. Ultimately this will be defined by you, but storage options will help you dictate what you'll do with your newly digitized life.

Local Storage
The easiest method of storage is buying a large external hard drive and organizing the files in a simple folder structure. The upside is the simplicity of it. The downside is that you have no backup. If you don't plan to store your files anywhere online, you'll want to—at the very least—purchase redundant storage so a hard drive failure won't necessarily cause the loss of your data. Configuring a RAID Array is the more common and best methods of accomplishing this, but you can also simply keep a separate backup. If you do keep a separate backup, storing it in a fire safe box or somewhere outside of your home will reduce the risk of losing your data.

Cloud Storage

While local storage is somewhat of a necessity, keeping local backups isn't. With excellent online backup tools available for free or very little money, storing your data in the cloud is another option. Online storage doesn't necessarily need to be an exact replica of your local drive. An alternative to storing your data using a backup service is posting your media to social media sites. There are several options for video and photos. OfficeDrop (formerly Pixily) hosts your documents. You're not confined to using traditional storage and bearing the associated costs thanks to a number of free and low-cost sites that handle it for you. The exchange? You may have to settle for lower quality copy of your digitized life.

Talking about storage is a lot like talking to a lawyer: they're always going to give you a conservative response. It's easy to say you need to keep three copies of everything and go through as much trouble as you can bear to ensure you never lose your precious data. There's nothing inherently wrong with this approach but it's not necessarily realistic for many people. When deciding how you're going to store your digitized life, be sure to factor in a storage and organization process you'll actually follow. Find a balance that allows you to keep your data safe while not overwhelming you with too much extra work.