I've become a real fan of one-in, one-out. Mostly because i'm determined not to let my wardrobe size expand and expand and expand. Like SarahD8, it prompts me to get rid of placeholders and items that don't really work, and sometimes I really need that prompt to "force" me to make a decision about something. It's been a huge benefit. I'm gradually clearing away the "ho hum" items that are 6's or 7's as newer 8's or 9's come in. I don't know what will happen, though, when the closet is mostly 8's - 10's!
Sarah, I, too, sometimes don't want to actually remove the previous iteration. I've started using that as a buying question: If I buy this "replacement" will I actually give up the old thing? If the answer is no, I realize that I'm really done with the old thing yet -- for whatever reason -- and i should hold off buying the new thing. I'm at that point right now with my daily tote bag, that I keep thinking I want to replace. Not actually ready to give it up. Usually when I'm really, actually, done with the old thing, I'm willing to give it up. (I rarely keep things in my closet out of sentiment ---I might pack them away in a sentimental box, if they carry a lot of memories. But I try not to need the "thing" in order to keep the memory, because I just don't have that much storage space.)