I am on Ubuntu 18.04 and I have never created a backup. Recently my computer started acting sluggish until I restarted it but it got me concerned. So I figured I better make a backup (work pc) just in case. However, I have honestly never made one before. It's asking me where I want to save the backup... does it matter?
Of course it "matters" and it matters a lot.
The general answer is based on your risk management model, which is based on the criticality of the apps / data on the server, the potential for disruption (operational threats) and system vulnerabilities and configuration.
Also are you currently using A RAID setup?
How much downtime can you tolerate, etc?
Do you lose millions of dollars a minute when the system fails? Or do you lose nothing important?
It is all based on risk management.
If my computer were to completely fail... blow up or something, no money would be lost aside from the time spent building up a new computer... a day or so. No the only thing I would loose would be the locally (non committed) changes to the application that I may or may not have made.
Then you don't really need to worry much about backups, obviously, since you are not doing anything remotely critical, by your own admission, on your computer.
FWIW, I back up the DB on this server (unix.com) locally (on the same computer) and remotely (in a completely different data center) once a day and manually backup up the configuration files, log files and web document files when ever I make changes remotely. The disk are also fully redundant (RAID configuration). If the site went up in smoke we might lose a days worth of posts, at the most in the worst case. In addition, I routinely backup to a second offsite location (on the other side of the world), in the very unlikely event two data centers in the same continent get hit by an asteroid or something unimaginable, but remotely possible.
I back my desktop computers every time I make an upgrade (before and after installing an OS upgrade) and whenever I work on an application locally, for example if coding a new applications, I back up remotely as I work (using git ) after any amount of coding. I don't like rewriting code, so I back up a lot 
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Okay, I suppose I am just confused about what actually happens when I create a backup. It sounds to me like I will need a healthy amount of space and that putting the backup elsewhere (perhaps on the network?) is a good idea?
The trivial answer that can be read (almost) everywhere: in a safe place. But, that's not as trivial as it reads. While you can - during creation - have the backup archive on a local disk / partition, you should then move it to a reliable, safe medium which won't lose the data within the next years and store that off site. Make sure it can be read and restored. Nowadays the net is a viable alternative if the data volume is not too high, availability is given, and exposure is low.
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What do you actually mean by "the network' ?
You should be very specific when discussing technology if you really want help.
But in general, where you store your backups is based on your risk model.
I do not store backups on "clouds" or "the network" or "cloud servers" generally speaking because backups should be stored, for me, in a trusted place which I control.
I keep some backups on a hard drive next to my feet.
Storage is cheap in today's modern world. I backup all by data. Other people, backup none of their data.
I know one guy who is one of the best technical scuba divers in the world. He dives deeply into caves for many kilometers where he must stage 20+ tanks of various gases. He plans for every contingency when he scuba dives with considerable redundancy.
However, he always is posting on social media how he lost some data for an important presentation because he has no backups and his disk crashed.
So, I think to myself. Here is a guy who is very careful about how he dives in caves; but is quite careless about his digital data. But then again, he cares about his life much more than he cares about a loss of some power point presentation data; which is his risk management model.
Everyone, every business, indeed very entity has their own risk management profile and you should evaluate your risk, cost benefits and make decisions on what is best for you; not what others tell you do to.
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