Rijndael or Serpent. Serpent is usually considered more secure in its construction because it uses 32 rounds compared to Rijndael's 14. However, Rijndael actually won the AES competition, whereas Serpent finished second (mainly because Rijndael is faster). Either of these are the best you are going to get. You could also throw Twofish into the mix as well.
Serpent-Twofish-AES AES-Twofish-Serpent I am confused between these two option in TrueCrypt. I assume the only different in these is the order in which the files are encrypted? If so, then which is better because? If the files are encrypted three times then what difference does it make in which order they are executed? Also, If I created a virtual drive from TrueCrypt and stored important documents in there (example MS Word, MS Excel, etc..). Would opening these documents create temp copies of the file anywhere else on the system?
Yes, this could occur. That’s one reason to periodically wipe the free space on your hard disk drives using a tool such as R-Wipe&Clean. Alternatively, consider using a utillity such as Undelete to capture and wipe all deleted files. Edit: Correction of typing error.
I went with the AES-Twofish-Serpent combo. I assume this is secure enough to store private documents in and be able to store them in online backup without prying eyes?
To be perfectly honest, any of the available algorithms [including non-cascade] will be "secure enough" for your purposes if you use a sufficiently long passphrase.
no, there is no known better way to "crack" it then by "brute force" (today). http://en.wikipedia.org/wiki/Advanced_Encryption_Standard