My experience has been that the large, high-volume studios (like those that did senior graduation portraits) usually had a specific retention policy, most often 7 years. Small operations could vary from 3 years to forever. A friend acquired a studio in a small town that had been in business for generations and upon reviewing the basement full of old negs, discovered some photos of historical interest to the town. Also, on the shelf under a few layers of dust, was a wedding album about 7-8 years old never picked up by the customer. It seems they got divorced before the album was finished, then got back together and wanted the album - came in and paid the balance.

I would say it depends on how much space you can afford to give to storage - and no less than 3 years.