CHICAGO (CBS) – Should you pay cash for your gifts or pay with a card? More shoppers are opting for cash to avoid the bills coming due in January. And, as CBS 2’s Dorothy Tucker reports, the new financial reform law will help make that decision even easier in the future.

Dana Marlowe is typical of a lot of shoppers this year. She loves the holidays, from decorating to buying gifts, but her joy fades quickly when the new year arrives along with the bills.

She told us, “When January rolls around, it’s like reality shows up in your mailbox.”

So this year, she and her husband are choosing cash over credit, and even figured out way to stay on track.

“We have a spreadsheet for it and we’re going to be able to follow it, so that post-holidays we don’t have any credit card bills to pay off,” said Marlowe.

While consumers are spending 2.2 percent more this year, none of the major credit card companies have seen an increase in activity, and most have seen a drop in transactions.

Experts like Jim Brown at the University of Wisconsin say the struggling economy and recent changes in credit card regulations may be responsible.

“A lot of issuers have lowered consumers’ lines of credit. They’ve raised fees,” he said.

Will this switch to cash carry on into the new year? Maybe so, thanks to a clause in the financial reform act.

It allows retailers to discount purchases made with cash by at least 2 ½ percent, the equivalent of the merchant fee retailers pay when someone uses a credit card.

Because of those fees, small business owners like Laurel Stradford say we all pay more for what we buy.

“It’s in the price of the goods. I think that’s true of every business,” she said.

Even for her small Hyde Park boutique, the fees add up. Stradford pays about a thousand dollars every month in merchant fees to the banks.

So, to avoid the fee, Stradford says she shares the wealth with more customers. She already offers a 5 percent discount to loyal customers who pay cash.

She showed us a jacket for $80. With 5 percent off, it would cost $76.

Experts predict we may see more businesses follow Stradford’s model.

John Ulzheimer of said, “We will in fact someday see two prices for every single thing that we purchase; whether it’s gas, a six-pack of Coca-Cola or a shirt at the mall.”

In the future, he says, credit card users may also have to meet minimum purchase requirements.

That’s also allowed in the financial reform act, which is being phased in by businesses and financial institutions.