Every email I receive goes directly to my inbox and stays there till I delete it. I have completely stopped using folders. My decision was based on a simple time calculation:
(time spent creating folders) + (time sent moving emails to folders) + (time spent searching within folders) VS. (time to type in a search query)
The right half of the equation is a much shorter time. When I need to find an email, I do a quick search for keywords. Say I wanted to find an email Michael sent me about social networking data. I search for 'social Michael' and pull up about 40 emails that have both terms. I sort those by sender, bringing my total to about 30, then by date, and it's easy to scan through and pick out the one I want. Total time spent, less than ten seconds.
There are a few actions you can take to make the process easier. First, be efficient about cleaning out your inbox. The second you deal with something, delete it. Second, make a good-faith effort to title your email with what it is actually about--or at least include some keywords in the text. This means not sending an email draft for approval with the subject "attachment" and the body "check out this text". It really doesn't take that long, and the recipient will likely appreciate it as well.
One caveat: Justin Miller made a a convincing argument that some administrative emails (receipts, confirmations, etc) should be filed because it's important that they be viewed as a group. I see his point, although I think that ultimately that demonstrates the need for mail programs to use a "tagging" system rather than a folder system. Just tag the emails with "admin" and you're good to go. Tagging also makes sense because some emails can't be easily classified as belonging in a particular folder. What if my social networking email from Michael also includes a question about a client meeting?
In discussing gmail, the media highlight its huge storage capacity or its advertising keywords. They're missing the point. What's revolutionary is that it completely eschews folders, instead using a tagging system combined with its own search technology. If Google can do it, can't you?
Legacy Comments
You talked me into it. Works with Gmail, of course...but not with Outlook and its miserable searches.
Sounds like someone needs Getting Things Done, and perhaps Lookout.
Depending on your mail client, setting up auto-rules to file emails from or to certain email addresses and or with regularlized subject headings can be a great timesaver.
My desktop mail client takes incoming from three addresses, with a mix of mailing lists, personal correspondence, co-worker mail, random mail, mail-based notification, and spam built up over about 10 years of online living. Folders help me organize and most importantly prioritize my workflow wrt email.
Thunderbird offers and interesting solution to this...
from mozilla.org:
"Beginning with version 0.9, Thunderbird now allows you to create Saved Search folders. A Saved Search folder looks like a regular mail folder but when you click on it, it runs a search according to criteria that you've set previously and it displays a list of messages that match those criteria. For example, you could create a Saved Search folder that lists all the messages received from a certain person over the past 30 days, even if those messages are stored in different folders and subfolders."
I am not aware of this feature being available in other mail clients.