Photoshop has a great arsenal of tools that let you work non-destructively. Let's take a look at three of the most important options.
1. Layer & Vector Masks
Have you ever cut something out using the eraser only to find out later (when your undos are no longer available) that you cut too much? Use Layer and Vector Masks instead of the eraser!
A Layer Mask (Layer > Layer Mask > Add Layer Mask) is a raster mask that can go from white through grey to black: anything you paint black will become invisible, anything white is visible and all greys are degrees of opacity. You can use any brush to paint on it or you can use a gradient to get soft transitions. In addition, you can add a layer mask from an existing selection. Layer Masks can be refined using a special tool, too (double click on the mask thumbnail) to help you refine or soften edges.
A Vector Mask (