How to do a backup on my iMac

It is up to you. It is probably cheaper in the long run, but you need to make sure the backup is not susceptible to the same reasons for loss as the computer itself. A drive next to a computer is a good backup for possible data loss from internal drive failure, but if somebody steals the computer they will likely also take your drive. I think the careful person has multiple backups and keeps them stored in separate places.

How to back up your Mac - Official Apple Support

In addition to Limnos' excellent comments, you may find this user tip article I wrote helpful, as just backing up your Mac to an external drive may not be the best overall strategy ... especially if your data is critical to you.

• macOS Backup Strategy - Apple Community