Imagine finally making a decision on a new car for you and your family. Well, it’s primarily for you, but your family will benefit from it as well.

It’s in good condition, it will fit everyone, it’s good on gas and it will make a big difference. Plus you should be able to get a little bit of money for your old vehicle. Yep, it’s a good situation, you just need to get a small loan to buy it, which should be easy enough because you’ll have no problem with the payments.

Everything is going fine at the bank until they tell you the bad news. You were late on your taxes last year and as a result your credit rating is preventing you from securing the loan.

It’s a frustrating situation. Often we’re plagued by the problems of our past even though we’ve grown up and moved on. If you’ve ever neglected credit card bills (or bills of any kind) or defaulted on a loan, then you’re in danger of having poor credit follow you around even though your current financial status is happy and healthy.

Well, credit scores aren’t magically cured overnight, but that doesn’t mean you can’t take action immediately in order to turn your credit into a boon instead of a bane.

1. Pay More Than the Minimum Payment

Paying the minimum balance on high interest credit cards will take years. We talk often about exit strategies – paying extra on your credit card bill will not only help you get out of debt quicker, it will gradually improve your credit score with Transition and Equifax, Canada’s two credit agencies. Reducing the debt showing on your credit report will take time, but there’s no better time to start than right now.

2. Consolidate Your Credit Cards

“The solution to improve your credit score: Gather up all those credit cards on which you have small balances and pay them off. Then select one or two go-to cards that you can use for everything.”

That’s John Ulzheimer, a credit expert who used to work for Equifax. Several small balances looks worse than a single, more manageable balance.

3. Pay Your Bills Immediately

Poor credit follows us around because we allow it to follow us around. We get complacent and we put off paying our phone bills or our electricity bills, and all of a sudden we have a couple months’ worth and we’re scrambling. So instead of putting off bills until they’re due, pay them off when you receive them and then you don’t have to worry. You’re going to have to pay them eventually anyways, so it’s best to take care of them right away. Your credit report will thank you.

4. Review Your Credit Report

Just like sticking to a weight loss plan, watching your credit report can not only motivate you to keep going, it can tip you off about potential errors. They’re unfortunate, but they do happen. Canada’s two credit agencies are TransUnion and Equifax. Make sure your reports are accurate and then do what you can to boost your score.

5. Put Your Credit Card in the Freezer

I had a friend who did this once when he was 21. The joy of owning a credit card caught up with him and he had some serious credit issues. After the card spent a winter in the freezer, however, he was able to pay down his debt and accrue some positive credit on his existing credit report. If you have a card with plenty of space, that looks good on your report and it also motivates you to keep your spending in check.

The biggest thing to remember when it comes to your credit score? You’re always going to have to pay the money back. When it comes time for a large purchase that requires a healthy credit score, the freedom of a healthy credit score will go a long way.

So, that phone bill that’s gnawing away at your pocket? Take care of it today.