I don't use a wallet, at least not in the traditional sense. You know, that bi-fold or tri-fold piece of leather in which you keep your cash, credit cards, insurance cards, pictures of the wife and kids, etc.
About 10 years ago, I got increasingly annoyed at the fact that I spent so much of my day sitting on a wad of leather, plastic and paper. Not only was it uncomfortable, it seemed so...well...unnecessary. I didn't carry a lot in my wallet, and the wallet itself made up the majority of the mass of what went in my hip pocket. "What a waste," I thought, and I started looking for an alternative.
I tried various solutions, but the one that I've used now for nearly 9 years is a variation on the money clip concept. However, instead of just keeping my bills in the clip, I keep the entire contents of what would otherwise constitute my wallet.
The above picture is the actual device I use -- a Clippie from Levenger (size Large). If you haven't before seen a Clippie, it's meant to be used as a high-tech paper-clip. It's basically two U-shaped pieces of metal. The inner pieces grasps the paper and the outer sleeve slides over the inner piece and produces the clamping power.

These two photos above show my implementation of this Clippie-based alternative wallet. As you can see, it's quite compact -- it measures just 3.5" long (the length of a credit card), 2.7" wide (the width of a US bill), and a mere 1/4" thick. The whole assembly weighs just about 1 ounce. I challenge anyone to demonstrate that their traditional wallet alone comes in under these measurements.
To be honest, the use of the Clippie is really only half the story. I've had people ask me about this practice over the years and most of them are convinced that their wallets contain just too much necessary stuff to fit in a Clippie or similar device. Here's what my "wallet" contains:
Typically, 3-5 paper bills (4 shown)
2 credit cards
Car insurance card
Health insurance card
Driver's license
Work photo ID card
ATM card
Usually, when I ask skeptics what they have in their wallets, they start producing handfuls of traveller cards (frequent flier cards, car rental cards, etc.), various pieces of paper with scribbled notes, dry cleaning receipts, photos, and the list goes on.
Here's the secret to getting rid of all that stuff: get yourself a PDA or smartphone and USE IT. Enter all your frequent flier data into it so you have it when the agent asks you for it (I've never had to have my actual cards with me). Put the photos in your PDA as JPGs and show them off in a handheld slideshow (bonus points with your tech-head friends). Put all those "notes to self" in the PDA and, becaue you can set alarms for them, you actually might remember them! And, finally, do you really need more than two or three credit cards on you at all times?
Anyway, the moral of the story is that I think a lot of people could put their wallets on a serious diet just by cleaning them out and thinking critically about each item they contain. Add an appropriately used handheld to the mix and all those slips of paper and other odds-and-ends really start disappearing quickly.
I'm not trying to convince anyone that this is the solution for everyone -- this is just a description of what works for me. If you try it out and you like it, great! Leave a comment and let me know what you think. Alternately, leave a comment why this absolutely couldn't work for you -- that might be even more interesting. :-)
Update: The Levenger site now shows Clippies as no longer available. How distressing! Since I get about 2 years out of each clippie, and I still have about 6 left in my original tin, I guess I'll need to start looking around for a new solution in about a decade.
Update #2: Levenger says they have a few sets of Clippies left, but the product is indeed being discontinued. So, if you want to try out this wallet alternative, might want to order soon (1-800-544-0880).