In 2001, MIT did a study called Always Leave Home Without It and compared how much individuals would pay for the same item using either cash or a credit card. Buyers paid an average of 30-40% more for the same item when credit was used instead of dollars. Why? Because it doesn't seem like real money. I have a rule of thumb that works for me. If something is under $20, I pay cash for it. Not debit. Hard cash. I am that loser in the Visa commercials. If its over $20, I usually discuss it with my wife before purchasing with a credit card. This may not be practical for everyone, but I have found it provides a great checks and balance system. If you owe on your credit card, you need to establish safeguards. Money is a great servant but a poor master.
For great tips on getting out of credit card debt, http://www.allprodad.com/playbook/viewarticle.php?art=238
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