IPhoto 5 vs. Photoshop for Organizing

I'm in the process of organizing all of my photos. I use Photoshop CS to do all of my editing. I like the ease of use with iPhoto and am wondering if it would be a good way to get all of my photos organized. I'd like to save space on my hard drive by not having a lot of copies of the same image, so I don't know exactly what I might do with a .psd file.
Does anyone have any thoughts or ideas about which is the best way to go on this one? By the way, I have thousands of photos.

Carol:
You can use iPhoto for your organization and PS CS, seamlessly from within iPhoto, for your editing. Any current psd files will import into iPhoto with no problem.
To setup PS as your editor of choice in iPhoto open iPhoto's preferences and under the General pane click on "Opens photo in:" radio button in the Double-click photo section. Then navigate to PS and select it. Now when you double-click on a photo PS will open and you can edit.
There is one caveat that you must be aware of: if you create a layered file of a previous jpg file and want to keep it layered you must do a Save As to the desktop and then import from there as a psd file. If you edit a jpg file and don't create a layered file you can just save. Also if you change the title you must save to the desktop and import from there. See Don't tamper with files in the iPhoto Library folder from the Finder.
If you have them already sorted in your folders then when you import a folder it will be copied into iPhoto as a roll whose title is the same as the folder. So a good part of your organization will be maintained.
Hope this has been of some help. Good luck.
OT
For future posts it will be most helpful if you include info about your setup and software: model, RAM, HD size and free space, system version and iPhoto version.

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