Illustration: Naomi Wilkinson

When Less Is More Money
There's nothing wrong with being a little sentimental, but we shouldn't hold on to more than we need—from clothes to outdated gadgets to paperwork and receipts.

Want to streamline your life but aren't sure where to start? Here's a guide to what you can toss, what you should keep, and clever ways to turn your castoffs into cash.

Pitch Paperwork

Still have your 2008 tax returns? (Honestly, I only got the courage to shred mine right before I wrote this column.) Discarding old tax forms or receipts can be nerve-racking, but try not to let emotions get in the way, says Cass McCrory, author and creator of the Subtraction Project.

1. Tax returns and supporting documents
The IRS says most of us can discard tax paperwork three years after the date we filed. Uncle Sam's time frame for an audit generally expires after that. (Keep digital scans if you want to be extra careful.)

2. Merchandise receipts
Depending on where you shopped, you might not need a receipt for a return. Target, Nordstrom, Macy's, and other stores allow returns of many items without a receipt if they can track your purchase using your credit or debit car d, or by an email order confirmation for online purchases. Check the store policy before ditching your paperwork.

3. Warranty Receipts
For big-ticket items (like electronics or appliances) with a warranty, McCrory recommends keeping receipts and related paperwork for at least the term of the warranty, which is usually one to two years. After that, they can go in the trash.

4. Bills, pay stubs, bank statements
Unless you're applying for a loan, like a mortgage (which requires an assortment of recent documents), you can confidently shred any statements that can be retrieved online and printed if need be.

Illustration: Naomi Wilkinson

Embrace Online Banking
To minimize financial paperwork and bills, sign up for electronic statements. Not only does this reduce waste, but some banks and credit unions even offer incentives, like decreased account fees, when you go green. Vanguard account holders, for example, can avoid the $20 annual service fee by signing up to receive statements and notifications online.

Living with less can help us resist the urge to splurge: A study in the Journal of Consumer Research found that being in cluttered environments decreases self-control, resulting in a greater likelihood of impulsive spending.

Illustration: Naomi Wilkinson

Earn Cash for Clutter
Your dusty ski jacket and 2010 iPad may evoke great memories, but ask yourself, "Does this item serve me today?" Will I use it within the next year? If yes, then it stays, says McCrory. But if the item has gone unused for longer than a year, it might be time to cash in. Luckily, these sites make resale a breeze:

1. Used iPhones: The site will send you a prepaid shipping label, inspect the gadget, and pay you for your device. At the end of last year, an iPhone 6s in good condition fetched an average of $245.

2. Other Ship GoPros, laptops, or wearable tech to NextWorth and get cash in return. Says CEO David Chen, "Even if a product is broken, it can see strong trade-in value."

3. Designer clothing: List high-fashion duds, and when you land a buyer, Tradesy will send a box and shipping label (and take a commission off the top).

4.Other clothing: The site sends a bag with a prepaid shipping label; fill it with good-condition clothing and accessories, then ship it back. ThredUp lists items for you, and you earn a percentage of the sale price.

Farnoosh Torabi is a personal finance expert, the author of When She Makes More, and the host of CNBC's Follow the Leader and the award-winning podcast So Money.

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