Step 4 to GTD Mastery is: I have a physical inbox, which I use daily.
On page 92 of Getting Things Done, Allen lists (at least three) paper-holding trays as the first basic processing tool for GTD.
These will serve as your in-basket and out-basket, with one or two others for work-in-progress support papers and/or your “read and review” stack. The most functional trays are the side-facing letter or legal stackable kinds, which have no “lip” on them to keep you from sliding out a single piece of paper.
My physical inbox consists of four, letter-sized, “lipless”, stacking trays.
The top tray is for any new items that need to be processed. When I’ve finished emptying my in-basket for the day, I get to press the red, shiny “easy” button.
The second tray is for items I may need in the near future (e.g. receipts, current reference material).
The third tray is just a stack of lined paper which I use for doing homework and any writing that doesn’t need to be word processed.
The bottom tray is for my read/review which includes books, articles/magazines, and CDs that I want to listen to.
I haven’t grasped the concept of the “out-basket.” I don’t think it’s mentioned anywhere else in the book. If any readers use an out-basket in their system, I’d be interested in what it is and how you use it.