When buying a Japanese-style sword for iaido, batto-do or other traditional Japanese sword practice, it's important to understand the way swords are measured to get the proper size.  Too short, you may not learn full drawing techniques, too long and it can be awkward to handle safely.  As different sword systems have preferences or requirements for length, ask your instructor for particulars.

First, you need to know a few of the terms:

Tsuba: The handguard

Tsuka: The handle of the sword. It's measured from the fuchi (collar next to the tsuba) to the kashira (the buttcap).  Depending upon the style or system of swordwork you are studying, there may be a size preference.  Many styles suggest that the left hand is at the end of the tsuka, the right hand just slightly back from the tsuba, and 2-3 inches between them.   Other styles prefer longer tsuka, check with your instructor for particulars.   Also, if you have a particularly long blade, you may need a longer tsuka for proper balance.

Nagasa: The length of the blade.  It is measured in a straight line from the notch in the top of the habaki (brass collar on blade side of tsuba) to the kissaki (tip of the blade).  As the habaki is usually about 1 inch long, it is important to measure from the correct place to get the blade length you really want. 

Shaku:  Traditional Japanese measurement approximately 12 inches or 30 cm.  A daito (either tachi or katana) is over two shaku for blade length.  A wakizashi (or shoto) has a blade length between one and two shaku.  A tanto blade is usually less than one shaku.

As someone who didn't know the proper place to measure the blade before, I wanted to pass on my experience of ordering a blade that is one inch longer than expected, to help others avoid the same mistake.