Over the years, I have tried to keep my collection of images — downloaded, scanned, or taken with digicam, organized on my computer. The method I will describe here is what has worked best for me so far.
One thing I try to always do first (but don't always) is make a backup of the originals in ".zip" format. That way if I'm using a photo editor I'm not sure about, no harm will come to the original image. Also, too, I've had happen dates being changed or gone missing Windows ME and even the image size changed if I simply rotated a photo!
Another organizing step for me is I put the photos into a folder that corresponds to the year they were captured. So for this year, my photos end up into a folder called "2009". You might think using a photo management program might be easier for all this, but what if you move the photo somewhere else on the computer? The program will take too much time just finding where it's at, or relocating it, especially with years of accumulated pictures.
The final step is making another folder just for the month of the photos. But this time, I also incorporate into the name of the folder some other key information used when Windows / Mac OS displays a list of files. For example, for January 2009 the folder name is "0109 JAN2009". This will ensure January displays first before February since alphabetically it's the other way around.
If you're wondering what editing tools I like to use it's Adobe Photoshop Elements, Picasa, and Picnik. So there you have it.