I store all of my designs on a external hard drive then when I wan to use them I move them over to a USB drive then to my embroidery machine. I have made folders to store them in by designer and if a freebie I store under misc. and what type of design it is. ie. christmas, butterflies, etc.
I probably have over 100,000 designs including the complete 2005 Dakota Collectibles. I join clubs and download all I can and look for bargins on designs when I shop. I know I have too many and will never use all that I have (but you never know when you will need "just that one").