Hot Trend: Ditching Credit Cards

Some are sick of getting nickel and dimed—or $39 and $39ed, as the case may be. Consumers are not buying the usual credit card company games. So they are only purchasing items they can actually afford, right now, using debit cards or cold hard cash. In fact, it was reported back in May that Visa Inc. (Stock Quote: V) has seen its “total dollar volume of purchases” made with Visa-branded debit cards rise above that of the company’s branded credit cards.

There are, of course, many different roads leading to the same city—and there is more than one way to live free of credit cards’ tentacles. You can quit cold turkey and never go back: that’s the Dave Ramsey method. Cash or debit cards for everything. You live as if credit cards are not even an option, as if you do not know they exist in the marketplace.

And then there is CNBC host Suze Orman’s recent crusade against credit card use. Unlike Ramsey’s zero-tolerance policy for credit card use, Orman is only asking her fans to pledge not to use their credit cards for a certain period of time. Her campaign works by sending a message to the credit card companies by temporarily starving them. It’s not a lifestyle choice; it’s a battle cry.

Why Dave Ramsey Hates Credit Cards

Personal finance guru and talk show host Dave Ramsey sure hates plastic! In an article on his Web site, he clearly explains why he favors cash over credit card use:

1) Credit card users tend to spend more. “A study of credit card use at McDonald’s found that people spent 47% more when using credit instead of cash. This is money you could have saved!” his site claims.