If they're hung they stretch out, become misshapen, and the shoulders get ruined. (aka shoulder boobs) Bottom line, it's always best to fold your sweaters. If you don't have enough shelf space to store them folded, fold them, AND THEN hang them over a hanger.

How do you store sweaters and cardigans?

It is best to store off-season sweaters folded in a cool, dry location. Ideally you will store them folded on a high closet shelf or in a fabric box where they have some ability to breathe. If you do not have shelf space or fabric box containers, folding sweaters in an airtight container is the next best option.

Is it best to hang or fold sweaters?

Sweaters. Even with slimline hangers, wool, cashmere, and angora will stretch when hung, so it's always best to fold your sweaters to keep their shape. That said, if you're tight on shelf space, fold your sweater in half once and lay it over the bar of a hanger.