I now organise nearly all my documents for the project using Google Documents. These are mainly letters and the spreadsheets I use to juggle finances and it works well for me. As I access the internet from at least two different places most days the ability to store documents on the web is perfect for me.
Functionally, the tools are light-weight equivalents of Microsoft Office applications with stripped back functionality. This doesn’t really cause a problem as those things you can’t do are often those things you really don’t need to be doing. For example, there is a limited set of six fonts in the spreadsheet application, but do I really need more? And there is a relatively simple set of formulas, but do I really want the complex stuff in a web application?
Another nice feature is the ability to publish documents to the web for sharing with others. This is basically a push button exercise – chose Publish and a long hard to guess URL is generated that will link to your document. You can distribute this URL as you see fit, making online collaboration easy. I’ve used this method for distributing user instructions for one of the websites I’ve developed and it is hard to beat for speed and efficiency of communication.
This is also a way to avoid worrying about backups. I trust Google to keep my documents accessible better than I trust myself to do so. Additionally, you can always export a copy of a document to your hard-disk.
If you always access the web from the same computer and are happy to handle your own backups then this may not be the option for you, but otherwise, highly recommended.