I've ridden with a back pack, panniers, and a saddle bag. The saddle bag is the best option of the three. the back pack is the worst. Panniers are nice (and I still ride with them the most - just because of the amount of stuff I carry most of the time) but remember, you need a rack, too. And if you think you can stuff a saddlebag really full, just remember that you can fill two (even four) panniers with a lot more stuff than fits in a saddlebag.

At this time of the year, I can fit everything I need for my commute into my jersey pockets. During the wet time of the year... it's panniers most of the time.