Using a hash function for passwords is a good suggestion, ++. However, there are known attacks for MD5 and SHA-1. While these attacks are not yet considered serious enough to recommend switching applications away from these hashing methods, better algorithms exist and should be used for new apps (this is particularly true for MD5). Both Digest::SHA and Digest::SHA::Perl can use SHA-256, which is stronger, so you should use it instead.
There are ten types of people: those that understand binary and those that don't.