What happens when fill your current Kindle? Do you get another one, or how does that work?
You can archive your read ebooks to your computer.
Kindles are cheap enough that buying another one is a legitimate option. That being said, in the near future, I expect Amazon to come out with Kindles with more memory and also the ability to store your books in their Cloud.
FWIW, Amazon claims you can store 3,500 books on your Kindle. Even if that is a gross estimation and it is closer to 2,000 that's still a lot of books.