May 2020 update wiped out my external SSD drive.

Other updates have done the same to other users in this forum.

I haven't saw anyone else with this issue yet, have you reported it via the Xbox bug report feature?

Very sorry to hear that! I haven't had this issue myself, but it's good to know so others may want to consider unplugging their SSD when this update takes effect. Hopefully this bug gets worked out soon, sorry again you had to deal with that.

because of their higher prices I would only be able to afford a small (256GB) SSD drive

Hi

Don't be fooled into buying an external SSD, most are far too expensive for what they are. I'm not saying not to buy an SSD though.

The cheapest option is to make your own. All you need is a standard 2.5" SSD and an external USB 3.0 drive enclosure. SSD's on their own work out a lot cheaper and a Drive enclosure costs only $10. External SSD use the same tech, just in a glued together
case.

It's not complicated either. Putting an SSD hard drive in an enclosure is as easy as changing batteries in a TV remote.

My external SSD is a 2.5" Corsair MX500 SSD drive.

There is an improvement when using SSD drives especially in games where the load times are already long (GTA5, The Witcher 3 etc). If I were buying an external drive, I would go SSD over a normal external hard drive not just for this generation but to ensure
it lasts well into the next gen. There are loads of tests carried out by external organisations like Digital Foundry that show benefits of SSD drives.

With installed games, you would still need the disc if it was a physical purchase or the account you used to purchase the game to play whatever was on the SSD.