But... What do you do when your external Time Machine drive needs to be replaced, but you want to keep as much of the past history as you can?
Nothing much can be done except to get very large drives. I have two 8-TB drives make backups every hour all day. On the average, with the amount of data I have on all the other drives, the Time Machine drives can maintain, on the average, 12–18 months of backups. If you have older files that you want to preserve indefinitely, you need an archive strategy. To some extent I do that to my older data, by making archives on to more large hard drives that are fired up only when you are doing archiving. I have about 15 years’ worth of old data that I preserve to this day, even though I know that I will probably need to retrieve less than 10% of it.
For a while, I had archives done on tape until I later found out that tape does not last as long as hard drives. There can be payoffs. I recently retrieved typesetting data for several old publications that the author wanted to update. The original looks were done more than a dozen years ago. Otherwise, we would have had to scan all those pages from the printed books.
Anyway, the short answer is, the more data you want to keep, the larger your Time Machine drives need to be. When they get full, just buy a new set to start anew. I still stay with 8-terabyte drives because the newer, larger units are not as long-lived as the 8s. Go to bacblaze.com to read their report on Hard Drive Life Expectancy.