Keep it as part of your live data: You don't know if that CD/Tape/HD/USB Stick/Whatever sitting on the shelf still works unless you test it regularly. As your archives grow, the amount of time you spend testing media increases. However, you can be notified immediately if a HD in a RAID array goes south, giving you time to recover before you have to restore from backup.
Back it up regularly: If you have a catastrophe, you want to know that you can get it all back.
Keep the backup offline when not being used: That USB HD you keep plugged in all the time isn't much good if a virus wipes all your storage out, you fat finger a delete command, or a power surge blows everything that's plugged in.
Have multiple backups in different places: If your house burns down, gets blown away by a tornado, or drowned in a flood, you don't want all your backups in the same house as your data. Distribute geographically based upon your actual needs. Your parents (or kids, depending on your/their ages) or siblings or other relatives in a nearby town (or the next state) may be good enough. Never underestimate the bandwidth of a 2 TB HD sent via FedEx. :-) Spending $$$$ to store everything in datacenters on multiple contents is probably foolish though -- if a major disaster destroys everything in a 50 mile radius of your house, were your photos that important? Maybe some are, along with financial info, or other highly valuable data, in which case it makes sense to keep some of that data stored somewhere very remote at a reasonable cost.
Make sure your backups work: Test restores. It doesn't do you much good to have a backup if the media fails, or the reader fails, or you can't connect it to anything.
If you're worried about bit-rot, keep parity data of some kind (like par2, or rar w/ recovery records, etc.).
Migrate data and data formats as necessary: Hunting down the hardware to connect a 30 MB MFM HD is hard enough. Having it work is a small miracle. Now you've got to come up with a way to uncompress the files that are in some long lost boutique archive format. (Or maybe an ancient version of PK-ZIP, in which case you're lucky.) And now, extracting the usable data from that file format. If you're lucky it's from a major program, like WordStar, or Lotus 1-2-3. If you're unlucky, it's from some software company whose products have long since been lost in the mists of time.