<prompt> Human: Hello PersonalFinance, Im a 29 year old male with a poor credit history. From age 18-26 I lived my life in a very irresponsible way and eventually wracked up debts and eventually collections to the tune of about 6,000. Since that time, I was able to put myself through school without obtaining any more debt, and eventually obtain a well paying job that currently pays 70,000 per year and its set to increase into the 80-90k range shortly. Also in that time, certain unpaid debts fell off of my list of open collections on my credit report. Currently I have 3,200 listed as being in open collections, both with a open date of mid 2012.Ive had 3 lines of credit in my life. One was a personal loan of 3,000 paid off monthly over 3 years with no missed or late payments.One was a line of credit that eventually went into collections to the tune of 900.The last was a credit card that had about 2300 in debt sent to collections. Heres where I need some advice:Ive been saving money each month since starting my new line of work. At the end of 2016 I should have roughly 17,000 saved. My partner makes 80k per year, and she will have roughly the same amount saved. How should I go about improving my credit score so that we may eventually have the ability to take out a home loan? Should I pay off these debts that I still have on my credit report, or should I wait until they are no longer considered open like some of my other debts?Ive looked into obtaining a secured credit card in order to reestablish good credit. Are there any cards you could recommend?Im open to any suggestions you have. I just want to get on the right track so we can eventually stop renting.Thanks for reading!  <response>: Im assuming you arent married.You need to save up a 6 month emergency fund. Thats 6 months of expenses. Keep it in a decent savings account, over 0.5 interest, preferably closer to 1.Watch your budget. If there are things you could cut, cut them. Next, you make sure you are contributing to your 401k plan, if you have one. Only enough to get your employers maximum contribution. If they dont offer one, skip this.Pay you debts down from highest interest rate, to lowest interest rates. If stuff is in collections, call the company and ask to be put on a payment plan. First ask if the amount can be reduced because you cant pay in full, but will make monthly payments. Maybe this reduces the amount. You pay the minimum amount on every debt bill, except the highest interest rate. That one gets all your extra money each month.Your debt should be blasted fairly quickly at your salary level. Once all your debt is gone, your credit will improve, but it still takes time to REALLY improve.Credit cards are good to have, as long as you pay them off in full, every month. Never carry a balance. They will eat away at your money quickly, as you already know. Never carry a balance.If you have credit cards now, dont cancel them unless they have annual fees. Not worth it. If you dont have a card, apply for a decent rewards card. Never carry a balance. If you cant approved for one of those, then apply for a secured credit card until your credit score is decent enough to apply for a rewards card.There is nothing wrong with renting. In many cases, its better financially to rent, rather than buy a house you cant afford.Please read this link as well. 