Well that is the most simple way to do it. I would just connect the new drive, Change the boot order so that you can boot from USB if you are installing from there, (Usually F10 on most towers). just check before you start. Change to DVD drive if its that. You can do it in the bios but this way when the computer reboots it will go back to booting from the hard drive and not the USB. Not a problem but just a little point to make things more simple otherwise windows will reboot from the USB and start to get itself ready to install windows all over again.
My thoughts on back-ups are mixed. I have hundreds of gigs of back-ups but i never use them. The only time i do i have one back-up that i make when my machine is all clean and set-up exactly as i want. Office, photo's etc, all the programs i use. There is not really that much on most machines that you pathetically need. So a clean install is sometimes very good. Just my thoughts though. If you want to do back-up then acroanis is the best. it restores very quickly but if you install these type of programs they will back up so often you end up with huge files. My choice is to always back-up from a self booting USB that way you make one file when you need to.
Again only my thoughts but i hope you find something helpful in there.