Of course many people will have older computers that may not be a good candidate for upgrading. How do you know if your current computer has the necessary requirements? If it's got Vista of any flavor it should do all right. Most computers that came with Vista installed should meet the basic requirements for Windows 7.
If you have an older Windows XP computer, it may not have the power. Regardless of what Microsoft says you probably want at least a duo processor and 4 gigs of fast RAM (DDR series). It also helps a lot to have dedicated video RAM or, better yet, a video card with it's own RAM of at least 256 Megs. Windows 7 is much better about being a resource hog but it still needs some power to perform at it's best.
If you now have a computer with Vista and don't have any problems, I don't think there is much in Windows 7 that is worth the $100 plus upgrade. Ease of use is no big deal, and the performance over a Vista machine may not be that great unless you have current issues. Vista got some bad press over performance issues and rightfully so but from what I've seen, not all Vista computers exhibited this problem. I've upgraded well over 100 Vista computers for clients and many did not exhibit any faster operation with the exception of shutdowns.
OK, so you decided that you just have to upgrade for all the whiz-bang new features. Here's the three best ways to keep your data and your sanity. You can also run a program from Microsoft called the Windows 7 Upgrade Advisor that will warn you of any incompatibilities on software and hardware on your current system. You can find it by doing a search in Google; it's available at many websites.
Option one is if you have an older Windows XP computer you have two basic upgrade options. You can't do an upgrade in place, too many issues and Microsoft decided against it. So now you have to do a clean install. Microsoft warns you that this may take a few hours! Yep, that's not a good thing. But most I've done have been much shorter.
Before you start you should back up all data files (user created), music files, photos, videos, or any other files you want to keep. You should also round up all your software install CDs for any software like MS Office that you plan on installing in your new Windows 7 OS. Don't forget to back up your Favorites (IE browser bookmarks), your Outlook data (outlook.pst - it has both your contacts and emails), password files, or any other important information.
Option two is keep that old Windows XP machine as a back up computer and buy a new computer with Windows 7 already installed. If your Windows XP machine is older that 3-4 years, it probably won't run Windows 7 with out upgrading your RAM, maybe adding a video card, and even a bigger hard drive. By the time you do that, you might as well purchased a new computer since many are on sale for less that $400. Mean failure on any computer is 4-5 years, so why spend $200 plus the Windows 7 upgrade cost on a machine that is going to fail within a couple of years?
Option 2a. OK, money is tight and you want to upgrade your Windows XP computer regardless. If you want to have a good fall back position and have enough hard drive space, you can install Windows 7 to a new partition and create a duo boot scenario. If you have a critical application that may not run in Windows 7, this is the only way to insure you can still use it. It's not a bad idea to do this anyway so that you can try Windows 7 and make sure it works for you. This is the best choice when going from Windows XP to Windows 7 on the same computer.
Option three involves upgrading a Vista computer. In this scenario you do have an option to upgrade in place, that essentially installs Windows 7 over your Vista install and no reinstall of software is usually necessary. But you will be bringing all the junk files and maybe any problems you had with Vista. You might also want to still run the Microsoft Windows 7 Upgrade Advisor to check for any possible problems. If at all possible I would do the same kind of backup mentioned in the Windows XP upgrade and do a clean install. You will have a much faster computer and a clean install with less possible problems.
The number one question I always am asked is should one upgrade to Windows 7 is it worth the time and money to upgrade? It's never a black and white answer. It depends on if your current computer is giving you problems and what your budget can handle. Many people just use there computers for email, surfing the web, and maybe to play some music and videos. If that's you, then I'm not sure you'll ever use the new features or get that much benefit from the upgrade. You can probably wait until you need to replace your current computer. If you are a computer junkie and love new features, then go for it. There are some improvements that a power user can benefit from and for really serious power crunching applications you can load up on RAM and hardware to increase performance.