My neighbor and I want to have access to each others files. I thought of linking our routers together so that way we would be on the same network. We each have different ISP and live door to door. Our houses are fairly close, so there shouldn't be any problem with distance. We have a wife and kids, and everyone has a laptop. Is there a way we can link up without buying a server?

BE CAREFUL!

The obvious method would be File/Sharing,
but you would expose both systems to the whole internet
(it requires ports 139+445 to be open on both systems to the WAN side )

Get a second NIC for each system and connect them together
a) wired or b) wireless using a new Access Point or WiFi router on one or the other system.

You should BOTH get a bidirectional Firewall so that ports 139+445 are open only on the second NIC addresses

I wouldn't want it to come to that. That is a big risk. I'd rather avoid. Do you know of any other method? May it be a rumor or anything otherwise.

(b) is simple and ZERO risk

the hardware looks like

Code:

modem(HouseA) -- router  -- local system
                             (2nd nic)  172.16.1.10 (gateway 172.16.1.20)
                            [COLOR="Blue"]    |
                                X
                                |[/COLOR]
                             (2nd NIC)  172.16.1.20 (gateway 172.16.1.10)
                            local system --- router -- modem(HouseB)

Both systems get to the internet using their local modem+routers, but
any access to the Other system does only that (does not go thru the other system).

The link -X- can be a crossover wired ethernet (shielded and outdoor rated covering)
OR a wifi link eg

Code:

modem(HouseA) -- router  [COLOR="Red"]--A-[/COLOR] local system
                               (2nd nic)  172.16.1.10 (gateway 172.16.1.20)
                                |
                       Access Point or WiFi router 
                                +
                                +
                                +
                                +
                           (wifi adaptor) 
                            local system [COLOR="Red"]-B--[/COLOR] router -- modem(HouseB)

Both -A- and -B- should be wired to avoid complexity and issues.

as long as each houseX has its own router, then only one system needs the
connection to the neighbor and all other systems connected to the router DON'T even see the neighbor
In fact, CAN'T ge there if they tried (without extra work)