One of these will work for you without question. I've added an absurd one at the end just to make sure I've covered all of the bases. I've also made a note about how secure each method is (as in how much effort it would take somebody to recover your files).
Deleting your Files
This is potentially the least safe way of disposing of your files. Deleting (or Shift-Deleting to bypass the Recycle Bin on Windows) doesn't actually remove the files from your computer, it just removes the reference to them in the file system. In many cases there are still parts of data in Shadow Volumes on some disks. Certain programs can also comb the disk and look for files that have yet to be overwritten and are still intact. They then read them and recreate them and it's as if the file had never been deleted. So this isn't a very secure method at all.
Formatting your Hard Drive
This is slightly safer, but it's essentially deleting everything at once (assuming you format the disk with the same filesystem as before.) It depends on the tool, Microsoft's Format Utility will overwrite everything on the disk (unless you specify the quick option). Some programs will just recreate the file system table (what keeps your files organized) but not actually do anything with what's already there, but some will. It's hit and miss, more times than not it'll be a hit, but you can also miss.
Zeroing your Hard Drive
Now we're getting better. This is a good way to remove all of the data from your hard drive. Basically, you're setting every bit on the hard drive to 0, thus removing everything. It's super simple in Linux (dd if=/dev/zero of=<hard drive> bs=<block size>), but in Windows it's not so simple. You either use third party software, boot from your Windows CD and use diskpart, or you boot into a Linux distro and dd it. The latter is my favorite. At this point, the average user can't access your data. It'd take forensic machinery to recover the files (because of the physics of magnetic media, there is still some magnetic resonance on the platter. I don't know if this is the case for solid state memory, I think zeroing solid state memory is okay, and most support a TRIM operation.)
Randomizing and Zeroing your Hard Drive
Basically the same as zeroing your hard drive, it just makes it harder for forensic teams to pull your data from the magnetic resonance of the platter. The more times you do passes of random values, zeros, ones, or repeating patterns, the harder it is for anybody to find recover your data. Some believe that it takes 35 passes to do this (the Guttman method), but that simple isn't true.
Degaussing your Hard Drive
Degaussing is the process by which you run your hard drive through a massive magnet. This will pretty much strip the platters of anything that was on them, but it will wipe the firmware from them as well (basically it makes the hard drive forget where the read/write arm should go). This is probably a bit overkill.
Dissolving your Hard Drive in Acid
Okay, this is the absurd one. It's impossible to reconstruct data from a hard drive that's been dissolved in acid. But really, if you have to do this or the two above, then you have bigger problems than just selling your computer or throwing it away.
Okay, but which one should you use?
My personal opinion (and what I've always been doing) is to zero the hard drive. Sure it may take a while, but it's worth it and it's basically impossible for somebody without forensic equipment to recover the data.
But please, please, please erase your disk (format it at the very least) before giving your hard drive to someone else. Or, even better, why don't you just reuse the hard drive? If you're like me, you can never have too much storage. Every gigabyte counts. Just reuse the hard drive and store some photos or some movies on it to declutter your primary hard drive. Tada! You don't even have to worry about erasing it safely now. Just overwrite it with more of your stuff.
You can read more about this here. It goes into more technical detail that I wanted to spare from this in order to make it easier to read because everybody needs to read this.
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