I save it to use in a string or crumb quilt if it's narrower than 2" wide and at least as wide as my inex finger -- slightly over 1/2". Those go into a shoe box. When the shoebox starts getting hard to close I either start stitching crumbs together or pull out the tracing paper to use for string foundations, or make quilt as you go blocks. Since I don't allow myself to have more than one shoebox full I devote some sewing time each week or so to strings or crumbs or qayg blocks. Of course that means that I always have a bunch of string blocks or crumb blocks laying around that can be used for quickie projects or pieced into an improv quilt.
Anything narrower than my index finger goes in my tin picnic basket to be used as stuffing or to make collages. Anything wider than 2" is cut into the largest square possible and added to my "pre-cuts" drawer.
I like to make scrappy quilts with a modern edge as well as non scrappy quilts so it's a system that has worked well for me over the years. And it comes in handy on those days when I really want to play with my sewing machines but don't want to deal with a structured project-- then I can just sit down and sew (instant gratification) while watching the level in the shoe box go down (sense of accomplishment).
Rob