Many Wisconsin residents have felt the pain of credit card debt: tens of thousands of dollars racked up on multiple credit cards. Sometimes this happens due to unexpected expenses. Other times it happens due to a period of unemployment. Whatever the case, many former credit card users are fighting back by living without credit cards altogether.

Sound drastic? Many people have resorted to life without credit cards by just using debit cards linked to a checking account. This may sound like the ideal situation for many people. However, for those with very little credit history, building credit can be a challenge. Mortgages and car loans are based on a person’s credit history. Therefore, never using credit can actually be detrimental to someone who’s looking to get a low rate on a loan.

In addition, credit cards offer protections that debit cards don’t. In the case of fraudulent credit card charges, credit card companies cover these charges. When these charges occur on a debit card, the person may be held liable for the full amount if they’re not reported in time.

However, paying with cash is a good way to save money, since people tend to spend more when they use a credit card over cash. In addition, having just cash helps people control their impulses. If they don’t have enough money, they can’t buy the item.

For those who do plan to keep their credit cards, paying on time and making only emergency purchases is a good way to build credit without drowning in credit card debt. But even when taking these careful measures, there could be times where credit card debt becomes overwhelming. In these situations, filing for bankruptcy is another avenue for debtors to explore that would allow them to either eliminate debt or set up a manageable payment plan to tackle these financial challenges.

Source: MSN Money, “Should you kill your credit card?,” Daniel Bortz, May 31, 2013