Hard drives fail too easily nowadays, an external drive is probably more prone to failure as it is moved around whereas an internal drive usually sits in the box.
Best way for backups is to use DVD-RAM discs if you can find them, they were purpose built for archiving. If you don't have terabytes of pictures, a USB flash drive
is better than an external drive, no moving parts, a good 64/128 gig high speed flash drive is fairly cheap, fits a lot of source code. For a lot of data, build a NAS box
and use RAID 1+0 (or RAID 10 as it's sometimes called) spread over at least 3 hard drives, if one fails you can hot swap and rebuild it.
If it's important, back up your backup, then back it up again
