As others have suggested, FileVault is a good means to protect your entire directory.
However, there is another option built into OSX. With DiskUtility you can create an encrypted disk image which mounts like like a drive on your desktop. If you create it as a "sparse image" it will grow as needed. Same security as filevault

As part of the open source MacFuse project you can also use EncFS (reccomend the gui version which is part of MacFusion) ... it uses stadard AES and can be read on windows or linux if need be. I use EncFS for my backups so that if I ever find myself without a Mac I can still get to the data.

GnuPGP can also be used to encrypt data in a very secure way, but frankly its more trouble than its worth.

TrueCrypt is indeed awesome and now that its crossplatform I think I'm going to give it another serious go.... but just wanted to point out some other options.