I think some have already mentioned this, but I got rid of my old clothes by selling them through consignment shops. They donate whatever doesn't sell, and give you a receipt for your taxes. I used the money I made to buy new clothes...but I often shopped for them at the same places!

I bought a lot of new ones at second-hand stores, too.
However, as much as I also espouse the "get rid of the big clothes" idea, I do recommend keeping one or two pieces from your highest weight. It's wonderful to try them on and see how much you've lost, plus it makes for a great before and after pic!