The age old question is what to do with yarn you really don't want anymore. Since almost all yarn comes in dye lots, I generally buy a bit more than I think I'll need - that way I won't run out in the middle of a project. This unfortunate event occurred a few years ago when I started a beautiful pink and cream afghan for the princess and ran out of the raspberry yarn well before the blanket was big enough. I could always frog it and make it into something else, but the darn thing is pretty big (although not big enough), and there aren't enough tissues in the house for the tears this would elicit.
Anyway, when I was doing my major closet reorganization, a problem came to light. I have WAY too much yarn. But, you can't just throw away perfectly good yarn. And I can't bring myself to sell it. So, it's been sitting in the garage waiting for me to make a decision. Today I found the perfect solution -- I'm giving it to someone who makes caps for cancer patients.
Her home is amazingly near my LYS :0) - so I'm going to go through the pile quickly and put it in the car. The kids have their arts classes nearby, so we'll be dropping off our bag'o'yarn after class. I get a clean garage and she gets free yarn to make her caps. Everyone benefits.
The goal is to get the yarn stash down to a point where every bit of yarn has a purpose. The only real issue is the acrylic yarn. I've got some skeins that I bought in college! I'll keep some for a shawl for my MIL, and some for the afghans I have planned for the kids (geography afghans, of all things), and then the rest will be off to donation land.
Then there will be enough room in the garage for the really important things -- garage sale stuff!