I have a need for multiple IE versions because we develop websites that are both used in IE6 and IE7. So I need to be able to have both IE6 and IE7 so I can see both browsers on how they behave and be able to edit and develop websites rapidly or as needed.
One caution: Dont settle for standalone IE7 and have IE6 as your default IE browser. Standalone IE7 is buggy, at least in my experience and other developers have also shared my sentiments.
What works: If you have IE6 or lower, upgrade to IE7 and install multiple IE versions that are lower (IE6,IE 5.5, etc). This way IE7 would be your default IE browser and if you need to test in IE6 or lower, then you can just fire it up on your start menu.
No guarantees: Although I have used this set-up for 8 months now, your situation might be different. I use a Windows xp pc, have 2gb of ram and 160gb hard drive. So dont assume that it will work as intended but most people on the net are more than
willing to help you. Just learn to ask, it's that simple.
There are more than 2 browsers: Most people would know IE and Firefox, because that's more than 90% of population using those browsers, so you should never fail to test in these 2 browsers if you are a developer. However there tons of other browsers like Opera, konqueror and Safari to name a few. If you have a need to test on this browsers (and only by asking your client would you know about this requirement) download them and test them out.