Most people wouldn't want to live life without a credit card. These powerful pieces of plastic have helped millions easily pay for things they need. But, as Canadian credit card debt continues to rise, the dangers of having easily accessible funds is becoming more pronounced.

For people in debt, cutting up your credit cards is the best thing to do. Here's why.

1. High interest rates

While some credit cards offer extremely low rates, most don't. Plus, people love their rewards, but those cards come with rates that near 20 per cent. If you miss one payment, the benefits of those rewards could be wiped out. You have to pay off the credit card balance every month in order to reap the most rewards. If you can't do that, cut it up. Those points aren't worth the hefty interest charges or the credit card debt.

2. Rising interest rates

It's unlikely the high-fee cards will increase their rates once our historically low interest rates rise -- some say they'll go up next year -- but that's not the case for the lower fee cards. Some of these cards are tied into the Bank of Canada's overnight rate; when it goes up, so do credit card rates. When that happens, you'll have to pay more interest on your debt. So consider paying off and then cancelling the card now, before rates climb.

3. It's too easy to spend money you don't have

We don't have to tell you that it's easy to rack up credit card debt. If you see something you want, there's nothing stopping you from buying it. That's why household debt in Canada is soaring -- people are still buying big screen TVs. If you're overspending, get rid of the card. You won't feel tempted to buy frivolous items any more and cash is more difficult to part with.

4. Financial fraud

While the banks are getting better at keeping your credit card number safe, there are also plenty of stories of stolen digits. Sometimes fraudsters will use a card to buy stuff, other times it can be used as a way to steal an identity. If you're concerned about a potential hack, then switch to cash instead.

5. Annual fees

There are credit cards that don't charge you a dime to use them, but there are a lot that do come with annual fees. Those fees can provide a service -- travel cards, for instance, offer free insurance, partly paid by fees -- but if you're not getting anything from them then they're a needless expense.

Credit cards can make sense, but it's often better to pay for your purchases with cash. Just imagine not having to worry about credit card debt ever again.

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