One Approach To Version Numbers

Make the whole numbers the "official releases": the ones that are good enough for official-type people (in the case of my thesis, my advisor or my thesis committee members) to read. Or, if it's a sofware package you're working on, to try out. The decimals in between, associate with preplanned milestones. So for example, here are some actual version numbers I planned out for my thesis
(after version 1, which my advisor Niko and others read):

Draft 1.4 First pass, incorporating the major points of comment
1.5 textually complete, but without all the final checks on the
text, and not the refs. Incorporates Niko, Jim & Anna's comments.
1.8 Formatted according to apa and everything, but has not had a final
readthrough by me for spelling etc
1.9 Try to get other people to proofread

And then version 2 went to my committee. Once a copy of the file you're
working on has met the milestone criteria, save it with the filename of
the next version along, so "Thesis draft 1p5" is the file for draft 1.5
*in progress*. For supersmall changes, fixes etc that are not planned,
you could maybe use the next decimal: 1.9.1 has a disastrous typo fixed,
etc.

Then, and this is important, you save that list of the version numbers and
what they mean, either on your computer or in your paper filing system.

Two points:
This is mostly for handling linear versioning for one person, not those
complicated cases where you want to branch off in two different
directions. So you can go back to earlier versions, but you can't work on
two alternate versions in parallel. We had extremely complex commercial
software packages at Amazon.com just to handle those kind of cases -
especially the difficulty of putting two alternate versions back together.

And if you just need linear versioning, Word now has a feature that can
let you save all those versions into a single file. Go to File ->
versions... and you can see how it works. For that there would probably be
no point to having version numbers. But I'm not sure if I entirely trust
that file format.