I am assuming you have a Microsoft account linked to the phone since a Windows phone is almost useless without that.
The contacts you see in the phone are maintained in that account in the cloud. So be aware that if you do "delete" the contacts in the phone you are also deleting them in the cloud and they won't be accessible on your Windows PC, tablet, other Windows phones, etc.if you have those.
That said, I don't recall on Windows phone 8 (which your phone came with or 8.1 which it might have been updated to) has a way to check all the contacts so they can be deleted at once, BUT if you want to delete them because you aren't going to use the phone, doing a hard reset returns the phone back to its initial state, so it will no longer have any contacts, customization, user installed apps, etc. And if you are NOT going to use the phone any more its a VERY good thing to do anyway so anyone who has the phone in the future won't find other confidential things anywhere in the phone storage. Doing a hard reset will retain the contacts in the Microsoft Cloud but they will be gone from the phone unless the phone is reconnected to that account.
Hard reset should be in the phone settings under About. Since I haven't used 8 or 8.1 for so long, I'm not sure what higher setting About might be under, but it shouldn't be too hard to find.