You will need to indicate the frequency and how many of these you want to retain
You can indicate whee you want these backups to go. If you do not pick a remote backup option, then you will have no offsite backups (unless you are using other backup tools that watch for a new file in the backup directory.
Once the setting have been made in system preferences, you will need to designate a TM Server to do the actual backups. This includes the location on that machine where the backups are stored.
Please make sure there is adequate disk space to store all the historical backups you configured above.