How to install WIndows 10 in 1 drive and save data in the other drive?

Win 10 is normally installed to unallocated space on a drive and creates its own partitions. Nothing else is changed.
Clean Install Windows 10

Arkas said:

Will the installation format both drives, or do I have to tell it to do so?
I want the first (256GB drive) to be C and the second to be D
Thanks

Ideally, you shouldn't have the secondary drive (1TB) connected during the installation process. Just have the target/primary C:\ drive connected, install the OS, and at least MS Office if you use that, and create an (interim) image.

If you cannot access the seconadry drive (e.g. some laptops make this impossible for the unfamiliar user) use the built-in Windows Diskpart
How to Diskpart Erase/Clean a Drive Through the Command Prompt | Seagate Support US

This makes the disk "invisible" to the installation process.

Then connect the secondary 1TB drive, and format/partition/etc that.

Reason for this : I use the "puppy in the park" analogy, the puppy loves to run around and leave it's mark on every tree it can find. Similarly, Windows can have the propensity to want to put its installation mark on any drive and partition it can find during the installation process. Consequently, a user can find that some critical system files have been stored on other drives, even though the installation process was directed at the primary C:\ drive. Any change to these other drives (re-format, failure, removal, etc) can cause the system to fail. Windows 7 was renown for this, Windows 10 not so much, but I have known it to happen.

Similarly, older versions of MS Office can do the same (they had an MSOCache folder that the installation process liked to randomly dump anywhere it could find other than the target system drive !!), hence installing it first (after the OS), before other drives are connected.

Arkas said:

Thank you. I didn't know it would be like this. If I only use the second SSD for personal file storage and for files from torrents for example would that be ok with backing up just the Windows drive?

Yes, provided you don't move (re-locate) the actual system user folders (Docuents, Desktop, Music, etc). Put your personal files on the secondary drive and just leave "empty" directory folders at
C:\Users\{username}\Documents
C:\Users\{username}\Desktop
C:\Users\{username}\Pictures
etc

Then image backup your system drive with Macrium Reflect (reflect), and separately backup your user files with a dedicated backup program (Robocopy, Xcopy as suggested above). I use SynchBackFree. These types of programs backup your user files in "native" format - .jpg > .jpg, .doc(x) > .doc(x), .mp4 > .mp4, etc which makes them easily identifiable and accessible.

The Macrium image process backs up as a single image file only accessible with Macrium Reflect

Arkas said:

Now to make D the default for downloads...

You can do that in the settings for some individual programs, rather than relocate the user system folder Downloads, .. e.g. web browsers allow you to ask where else to save, before auto saving a file to Downloads; most torrent programs allow you to set the location of torrent files and the downloaded files (incomplete and/or complete); etc.