My washing machine is in my bathroom, so most of the time I put the used cloth directly into the washer and then it gets washed in the next load. If the washer is running, I'll put the pads into a small plastic container I keep next to the toilet- no water or anything; just a dry container. Ideally I'd like to get a small "trash" can with a lid for that purpose, but I have not yet gotten one.
If I can convince my DDs to use cloth, we'll need a container of some sort, large enough to hold cloth for 3 women- but for now one DD isn't quite old enough and the other is using disposables (this is only her 2nd cycle ever so there's still plenty of time to convert her!

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When I wash pads, I generally just use cold water and mild soap, no additives- unless the pads end up thrown in with a load of towels and/or tablecloths, in which case I'd use warm water and non-chlorine bleach.