You just have to update once a notification says that an update is available and it will update the system without deleting anything.
There is no best practice, it depends on what you need to backup. You can backup with TWRP (go to TWRP (the recovery mode) > Backup to do a full backup of the phone in case something goes wrong. (except Internal Storage, which is what you can access when you plug the phone to a laptop)
And to backup in case you have to change the phone, just backup your contacts, files, etc at the frequence you want by coping the files on your laptop (or the /e/ cloud).
Often overlooked (even though TWRP displays a warning about this while backing up) … TWRP doesn’t do full backups.
Internal Storage has to be dealt with in a different way (e.g. simply copying it to somewhere else via USB while TWRP is running should work).
(Unless somebody has success in backing up a GSI and restoring it on a different phone model, but installing and using GSIs is not for newbies and/or the faint of heart, at least as far as I read about them.)
Yes. You can backup and restore the entire system among same models.
I did it on three Samsung i-9300.
There is nevertheless a trick on the name of the backup. I will report it here when I will recover it from the net