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Why fewer people want credit cards

By Jeanine Skowronski · Bankrate.com
Monday, May 5, 2014
Posted: 5 pm ET

More Americans are eschewing credit cards.

According to a recent Gallup poll, 29 percent of Americans do not own any credit cards, up from 22 percent in 2008. The average number of credit cards in our wallets has also gone down from 2.9 in 2008 to 2.6 cards in 2014.

Number of Credit Cards Americans Have

None 1 to 2 3 to 4 5 to 6 7 or more
April, 2014 None 29% 1 to 2: 33% 3 to 4: 18% 5 to 6: 9% 7 or more: 7%
April, 2008 None 22% 1 to 2: 35% 3 to 4: 22% 5 to 6: 11% 7 or more: 9%
April, 2006 None 20% 1 to 2: 35% 3 to 4: 23% 5 to 6: 11% 7 or more: 9%

Source: Gallup

Gallup did not include questions about why more people had less plastic in the poll, so it couldn't provide any direct data on the trends. However, there's a good chance the Great Recession and its lingering effects on the economy are contributing to the drop.

"Having credit card debt is more taboo than ever in the history of credit cards," John Ulzheimer, president of consumer education at CreditSesame, says.

Post-crisis regulation -- specifically The Credit Card Accountability, Responsibility and Disclosure Act of 2009, or CARD Act -- has made it harder for individuals under 21 to get a credit card. (They now need to have a job or a co-signer.) And, while credit standards are starting to ease up, some issuers remain reluctant to do business with people who are risky.

To a lesser degree, "the marketing of prepaid debit cards has gotten more and more aggressive," Ulzheimer says, which has taken business from traditional revolving credit cards.

Migrating solely to debit, however, may not be the best idea. In fact, "that's bad financial advice," Ulzheimer says, given that a solid credit history is integral to securing a mortgage or an auto loan.

"There's really no better alternative to a traditional revolving credit card when it comes to portable capacity and aggressive fraud protections," he adds.

How many credit cards do you carry in your wallet? Have you completely given up on credit? Why or why not? Let us know in the comments below!

Follow me on Twitter: @JeanineSko.

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90 Comments
Alice James
May 13, 2014 at 5:04 am

Two words...DAVE RAMSEY

Mab
May 12, 2014 at 4:30 pm

CCs aren't worth it. Its all about nickel and diming the consumer now.

Michael
May 11, 2014 at 12:03 pm

I have one card because the Federal Court requires you have one for electronic filing and paying fees. My debit card has a daily limit so I'm unable (and unwilling) to use that. As a bankruptcy attorney I decided to practice what I preach and get out of debt.

Mike
May 09, 2014 at 12:47 pm

I've been using CC's since the 80's. It's an interest free loan that pays you over time. I've never paid a late fee or interest. Have made thousands of $ in rewards/free airfare. Would never select a card with an annual fee and the fees that the CC companies charge is on the retailer not the consumer. If you have even a small amount of self control then yes, you can get something for nothing.

just me
May 09, 2014 at 8:50 am

Don.t trust banks

just me
May 09, 2014 at 8:49 am

Don. trust banks

hryder
May 07, 2014 at 6:15 pm

Additional note-We would close credit card accounts if the terms were neutral or at any direct cost to us. Should merchants go to direct discounts for cash payments then we would pay cash and only use cards when the price is the same for all regardless of method of payment in full. Do not use the credit card cause higher prices canard since cards do exist and will unless ALL card holders would cease employing them for purchases at the same time. Remember that specific store credit cards began this means of debt payment at a specified time in the future.

hryder
May 07, 2014 at 6:02 pm

Bruce, you are wrong. We have a Discover card that has no fees and pay the entire charged amount each month. We have never paid a late fee or interest charges because we purchase only those things that would be bought if we paid by check or cash. Basically, we pay $.99 for what most folks pay $1.00 and with a few of the cards promotions even less than $.99. We have received more than $200.00 in gas cards in less than two years with a net gain of over $170.00 by judicious use of such offers. If one has discipline with credit there is no problem. The problem is that the majority of Americans are as financially illiterate as Congress and the USA's current President.

Joe
May 07, 2014 at 4:51 pm

Headline: Why Fewer People want Credit Cards

Actual Article: We don't really why fewer people want credit cards, but we are willing to take a bunch of guess backed by zero data.

LOL.

Bruce
May 07, 2014 at 4:39 pm

I'm an Accountant by training. [I have a BBA in Accounting and a vocational certificate in Bookkeeping.] There are no free lunches. The "rewards" are simply there to encourage you to buy more stuff (that you probably wouldn't have bought, otherwise). Discover pays you 1% cash back? They charge you >1% to buy whatever. Many cards charge you interest on the cash that you get back (for your "cash rewards"). The cards get more of your money; you get less of it. I have dispensed with all of my CC's; I seldom used them. Many also charge you a fee simply to have the card in your pocket, whether you ever use it or not. Then they charge you usurious interest if you ever actually use the card, on top of the "annual fee" to simply have the account.

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