I use Retrospect for local backup in combination with Carbonite. Though lately when I save over top of an old file (i.e. open an old file as a template and forget to "save as" before editing it) I find it easier to bring the old one back from Carbonite than from the external drive, since I don't always keep it plugged in and I'm on the go a lot. I don't always have the external drive accessible, but I can always wireless tether to my Hero to access Carbonite.
Of course Carbonite is a subscription service, but it's not too expensive - I think $50 a year or something like that.