What is the best way to store user settings for a .NET application?

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I love using the built-in Application Settings. Then you have built in support for using the settings designer if you want at design-time, or at runtime to use: 

// read setting
string setting1 = (string)Settings.Default["MySetting1"];
// save setting
Settings.Default["MySetting2"] = "My Setting Value";

// you can force a save with
Properties.Settings.Default.Save();

It does store the settings in a similar folder structure as you describe (with the version in the path). However, with a simple call to: 

Properties.Settings.Default.Upgrade();

The app will pull all previous versions settings in to save in.

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