I want to do this and am using Flickr. OK, this is on-line, but I like the idea of web-based services. I can also keep a copy of each photo as I scan it in, of course, and, yes, Photoshop Album is good for sorting and maintaining this kind of local archive.
Picasa works well, too, for this purpose and is free. MS’s Photo Story is a different kind of product, but is also free and well worth looking at.
