I don't cut anything until I'm ready to use it, with the exception of scraps that are smaller than a 10" square .
I use a modified version of Bonnie Hunter's Scrap Users System:
http://quiltville.com/scrapusersystem.shtml\
I cut strips to the sizes she indicates, but leave them long. Don't cut them into squares right away. I also have bigger sizes, 5" and 6.5" She has dozens of free patterns, there's a link to a chart at the top of the page that shows which size patches you need for which quilt.
http://quiltville.blogspot.com/p/free-patterns.html