"I would very much like to use Time Machine but I don't know if the Time Capsule is the best solution. What do you guys think or do you have other devices you could suggest in stead?"
Suggestions follow.
Unless you really, REALLY need Time Machine (if you have the right reasons, you'll know why you need it), you'd be much better off to create and maintain a "bootable clone" drive instead. The primary reason for having a BOOTABLE (emphasis intended) clone is that you can't boot from a Time Machine backup in an extreme moment of need. If, someday, you go to boot the Mac and it won't start up (from the internal drive), you just hook up your bootable clone drive, and boot from that, and then get things going with the main drive again. Again, you CANNOT BOOT from a Time Machine backup.
You can use either CarbonCopyCloner or SuperDuper! to do create a bootable backup.
CCC is free and will do everything you need. It can now even "archive" old files that no longer exist on your main drive (and would be removed from your "clone" during the incremental updating runs).
For hardware, I'd suggest you get one of these:
http://www.amazon.com/s/ref=nb_sb_noss?field-keywords=usb+sata+dock&url=search-alias=aps&x=0&y=0
... instead of an "external hard drive". They are cheap, easy to use, and can be booted up from as well.
Just put in a "bare drive" from a vendor of your choice, and you're ready to go. You can even keep a second "bare drive" (or as many as you like), and swap them out as needed.
A "dock", combined with one or more bare drives, will become one of the most useful accessories you can have.