@GreenTeaLikesMe
I have one modest cabinet for all the paperwork in the house (for example), so every time I go to the cabinet to put in something (like this year's tax returns), I have a quick root around and throw away some things we don't need, like instruction manuals for household items which are no longer in use or where the instructions could easily be found online instead, stuff like that. There is a limited amount of space and it can't be exceeded, so stuff gets decluttered and freecycled on an ongoing basis.
This is what I've been doing for the last couple of decades and what I preach to my clients. It's ALL about "weeding out" as the years pass, for both personal and business stuff. Knowing what is important to keep forever, and knowing what can be ditched after a year, after 5 years, after 10 years, etc. Things like documents for buying your house, or P60s, or property improvements (lifetime guarantees, Fensa certificates for windows, etc), need to be kept forever - property documents needed when the house is sold, P60s "may" be needed when it comes to retirement and you find HMRC/DWP have missing years and intend to reduce your state pension!
Good idea to keep utility bills for a year or two, but as long as everything is right, i.e. you're billed on meter readings not estimates, etc., then safe to ditch the older ones. Grocery receipts safe to ditch a couple of weeks later once you know you don't have to take anything back that's manky. Small electricals - keep receipt for as long as the guarantee period - i.e. some vacuums may have a five year guarantee, so make a note on the receipt and keep it. Likewise kitchen appliances, TVs, etc. But really no point keeping a receipt for a toaster with a 12 month guarantee for a decade! Bank statements and credit card statements etc - again, keep as long as you feel there's a need - weed out the older ones with nothing "special" on them, but keep the odd ones with special/unusual transactions like receipt of an inheritance, buying a car, buying/selling a house, big purchases such as property improvements, etc - again, keep it all for a couple of years then weed out the ones showing nothing of importance.
Most people can start off with a box full of papers for a year, but can weed it down after a couple of years to just an envelope full of the important stuff, then after a few more years, it may be down to just one piece of paper, and you end up with a single large envelope with everything "really important" which needs keeping for ever, i.e. house purchase, home improvement invoices, certificate and guarantees, P60s, etc.
Little and often is the answer. Make it become a habit. Like you say, for every piece of paper you put in your "current" file, box or whatever, take at least one of the older/less important things out.
PS whilst the above is talking about physical pieces of paper, the same applies for scans/electronic documents. Don't just save everything for ever as it will take ages to sort it out (you or some other poor sod) and also there's the risk of it getting lost/forgotten (would your next of kin know where you store electronic data, would they know your passwords etc?). Organise your electronic archives and weed it out the same way to reduce the unnecessary/pointless clutter.