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Assuming you have rooted your phone and installed Xrecovery:

Making Backup:

1. In Xrecovery menu...goto "Backup and Restore".
2. Select Backup.
3. Your backup will be saved in "/sdcard/xrecovery/backup/". Copy it to a save place in your pc.

Note:

• Backup makes an image(copies) of the entire phone along with all settings,messages,applications installed,etc!
• Preferably make 2 images....
•  After doing factory reset(full wipe) which will act as a clean image.
• After Installing all required applications and settings - which can be used to make quick restore when needed. 
• DO NOT RENAME THE FOLDER!! (else you will get a md5 mismatch error during restore!)

 Restoring:

1. In Xrecovery menu...goto "Backup and Restore".
2. Select restore. Then select the folder to restore.
3. Done. :)