Some thoughts for your consideration:
1 Here's a simple way to hide stuff from casual prying eyes, but please be aware it will not stop someone who knows what they are doing from "seeing" the data... for this you will need a more sophisticated approach.
2 For many years truecrypt was used very successfully to password protect data, but the developers decided that they would no longer continue to develop and support it; the effect being much like that with Windows XP when Microsoft stopped developing it and supporting it.
3 Bearing in mind that Win XP is no longer a safe operating system to use on a computer that is not isolated from other sources of data (and that includes the internet, flash drives etc etc.) then truecrypt may serve your purpose, however please do your own research on this, and to get you started have a look here:
4 Backing up is a wise step for any user to take, but please note that a backup that does not have at least one copy kept safe offsite and on removable media, is no back up at all..... I usually recommend at least 3 copies on separate media and usually recommend disc images, with the creation of an emergency boot disc as well)
Do remember that with powerful encryption tools, its vital to keep passwords safe, if you lose/forget your truecrypt password then the data can be regarded as "gone"