I just give it to the squadron.
I just got promoted to 2Lt yesterday (they like me! they really like me!) and now I have a pair of blank CAP epaulets that have never been worn. What do folks usually do with outgrown insignia stuff? Sell it to Japan on eBay? Donate it to the squadron uniform stash? Get creative and up-convert it to a 2Lt? (Note: very unlikely to happen as I'm not good at embroidery.) Thanks for helping with a noob question.
As a squadron logistics guy, I truely appreciate when Seniors or Cadets turn in or donate things that they have outgrown or have extra of that they can spare. I've been working on sort of a "give a penny take a penny" concept with Sm epaulettes starting with the blank ones. The idea is that when you come into CAP and you pay your dues and get your member ship card, our squadron is willing to help you get a jump start on some items. That said, we hand them a pair of loaner epaulettes that later can be traded up at the next promotion. So far this concept has been well recieved by our Senior Membership at my squadron.