It's probably a decent enough backup for your purposes. It would be a little safer if you used two external drives and alternated between them, so that if it comes time to do a restore and you find a problem with one drive you've still got the other one to fall back on. For real peace of mind store the one you most recently backed up to offsite. Failing that, at least make sure to store it somewhere away from the computer so that they don't both get stolen when someone breaks into your house.
Also, be sure that you have a couple of copies of all of the software discs and their installation keys squirreled away safely somewhere, since if you loose your C: drive you'll have to reinstall everything.