That’s a matter of opinion. All backup programs will either delete old content or fail when the destination device fills up. Which you prefer is a matter of preference and your specific requirements.
I currently use a 4TB hard drive to back up my Mac’s 2TB internal storage (of which about 1TB is used). My Time Machine backups go back to the first backup of this computer, because it hasn’t filled up yet. If/when it does fill up, however, I would prefer it to delete a backup from five years ago than to fail and not back up my current data.
If you have an Apple Silicon Mac, there is no way to restore a backup (bootable or otherwise) such that you can restore the system volume it to a new Mac’s internal storage (or to a wiped SSD) - you always need to boot the system’s macOS (possibly after reinstalling it first) and then restore the non-system content from your backup. Although the two most popular disk cloning tools (SuperDuper! and Carbon Copy Cloner) both provide a front-end to Apple’s ASR utility, it is not considered reliable, and is only known to work for making bootable external drives. I don’t think it is possible (someone correct me if I’m wrong) to boot from such a backup and then clone it to the Mac’s internal storage.
So if you need to perform a full wipe/restore of a modern Mac, you will be installing macOS via Apple’s Recovery system and then restoring your backup over that. This restore could take one of several forms:
- Use Migration Assistant during the macOS installation, or soon afterward. This is what Apple recommends, and is the easiest solution.
- Restore the entire content of a Data volume backup. This should work as long as Mac’s macOS release is the same as the one from the original system. If the macOS version doesn’t match (especially if it’s older than the backup), it is possible that something may break.
- Manually copy your backed up documents and apps, but don’t touch the contents of the Library directories. This may require reinstallation of some apps and will almost certainly result in losing saved preferences.
All that having been said, in order to make that backup of your Data volume (or any volume other than the System volume), I would use one of the two popular cloning utilities: SuperDuper! or Carbon Copy Cloner.
If a more traditional backup (e.g. to a database-like file) is OK or preferable to a clone, Retrospect is still available. But it’s expensive. It is really more of an Enterprise backup solution and may be overkill for a personal backup solution.
I haven’t used Retrospect for a long time, but the last time I did, it would create a large opaque database file on the destination volume containing all the backed-up content, and an index file stored on your boot volume. Subsequent incremental backups append new data to the database and update the index. The result is not bootable and isn’t directly accessible - you need to use the Retrospect app to view or restore anything from those backup databases. The way you restore a system is to reinstall macOS, install Retrospect, and then run it to restore the backed-up content (it will regenerate the index from the database if it’s no longer available).
IMO, tools like Retrospect are best for making backups to remote network file servers or to high capacity devices like tape drives (which, these days, are far too expensive for non-enterprise users).