To avoid wasting time and money, make sure you choose the right version of Windows XP. Not all versions are appropriate for all installations, and most merchants will refuse to accept returns of opened software.

Choosing an update version may save you $100 whether you buy XP Home Edition or Professional Edition, but upgrade versions won't work for all users. To install the upgrade version of XP Home Edition, you'll need a working installation or an original program disc for Windows 98, 98 SE, or Me. The upgrade version of XP Professional requires Windows 98, 98 SE, Me, NT Workstation 4.0, 2000 Professional, or XP Home Edition.

XP Home Edition offers a good mix of features for most mainstream users, including ample home-networking features. XP Professional adds better security and network-administration features, support for systems with multiple processors, and a small number of advanced features, such as better backup and restore options and the ability to control the PC from other Windows systems.