I had to look up "capsule wardrobe". Sounds like it's just a catch-phrase for basic, minimalist, perhaps classic.
My suggestions:
- Set aside a day to try on your own clothes. Put on every piece, look in the mirror, and be critical of whether this item really fits, is something that suits your lifestyle, and so forth. Everything that doesn't work, give away. Yes, even if it was expensive, even if you wish it worked for you. You're overwhelmed. Get rid of some stuff.
- Wash everything. Arrange it in your closet so you can find what you need.
- Make a list of things you currently own but cannot wear because you're missing a key component of the outfit. For example, if you have a pair of great red pants . . . but nothing to wear with them, write that down. If you have a dress that you neve wear because the neckline looks too "empty", find a necklace or scarf that'd "finish" the dress. As you shop, make it a priority to find things to "fill out" those needs. This is less expensive than buying whole outfits.
- Do you have an excess of any one item? I think typical "excess" items tend to be black pants or shoes, or white blouses. Because these are so basic, many women tend to pick up more, more, more. But a person only needs so many. If you have too much of one thing, donate the excess.
- Quite buying clothes at Target. Their stuff doesn't launder well and doesn't last; thus, in the long run, it's more expensive than purchasing a quality item that will last you for years and years.
- Watch "What Not to Wear". It's no longer on TV, but I bet you could find episodes online. Or check out similar books from your library -- I've found several, and they've been enlightening. It took me a long time to figure out that what looks great on a tall, willowy model doesn't suit me. I know now that V-necks suit me, blazers and button-down shirts don't, etc. I know that I like to wear bright colors, small prints, and red shoes . . . but I can't wear spaghetti-strap tops, skirts with a detail at the hem, or anything in yellow. When you're wearing something that you know "works", pay close attention to WHY it works. Then buy more of that detail.
- Quit buying items just because they're cheap /on clearance. I used to be soooo bad about this. My new rule -- well, I say "new", but it's been my rule for 20 something years now: Never buy something that you don't like enough that you would buy it, if it were full price. When you pick up random stuff because it's cheap, you end up with a mis-match of stuff -- a shirt that kind-of works, but you have no pants to match it; a great evening clutch, but you never really use such things; a dress that will be perfect once you get it hemmed and buy some brown shoes. Instead, buy outfits. If you like the shirt, either be SURE it'll go with the pants you already own, or buy a pair of pants NOW to match it.
- Years ago I read something in a newspaper article that shocked me -- it was about packing for travel, but it works here too: The author said, Never buy anything that you don't expect to keep for the next 10 years. I was in my 20s when I read this, and I thought that was crazy! 10 years? But as I thought about it, I realized that MANY of the things I wear over and over and over were rather old -- a denim skirt, my great knee boots, a jacket, a classic dress. Those things kept on "working" for me because they were quality, classic items that I could pair with other things. In contrast, the trendy things I bought tended to be worn a couple times, then they'd sit around for two years 'til in a cleaning frenzy I gave them away. Now I ask myself, "Can I see myself wearing this when I turn 50?" I assume that jeans, tennis shoes, and under garments will wear out in less than 10 years, but I often give a potential purchase the "longevity test". In my job I wear mostly casual, knit dresses with cardigans OR slacks with sweaters. I buy most of my dresses from Lands End (they go on great sales); their stuff is classic, and the dresses easily last 10 years.
- If you want something trendy, make it an accessory. It's fine to buy a scarf or a chunky bracelet in the hottest color at Target. It isn't going to wear out.
- Buy something every season. I had to learn this one the hard way. When I was young, I bought, bought, bought . . . but then after I had my first child, I stopped buying clothes. I rationalized that I had "enough" and that we didn't have money to spare, and I told myself I didn't want to buy anything new until I was back to my pre-baby weight. Then I had another baby, and I was back in my maternity clothes. After the second baby, I prepared to go back to school in the fall, and I realized I had bought LITERALLY NOTHING for my wardrobe for something like 4-5 years . . . and every single thing in my closet was a complete rag. I didn't look professional. I'm not advocating that a woman should go to work every day looking like a fashion model, but my clothes were not acceptable: They were threadbare, faded and out of date. So I found myself forced to go buy a lot of stuff all at once, which is not the way you get the best prices. After that, I developed a system. Now I buy 1-2 outfits every spring and every fall, and at the same time I discard something old and worn. This means I always have something new in my closet, something I could wear to a nice outing. Similarly, I buy my husband two LL Bean shirts every year -- never any other brand because they really, really last.
- Buy quality under garments (especially bras), even though they're expensive. And get a great haircut; that makes all the difference in the world.