Back from the dead

Just because soap characters seem to have nine lives, don't think the same rule applies to your credit. Once you've gone off the credit cliff or blown your financial profile to smithereens, there may be no going back ... at least not without recasting your credit character!

Lesson: Deal with outstanding debt head on, before your credit ends up six feet under.

"Ignoring your debt is like committing financial suicide," says money expert Denise Winston. "Walking away from debt can impact your long-term financial health and determine the quality of your life."

If you can't pay off your debts in full, consider negotiating a lesser payment or a repayment plan with creditors directly, suggests Catey Hill, author of "Shoo, Jimmy Choo! The Modern Girl's Guide to Spending Less & Saving More." "They may refuse to cut you a deal at first, but keep pushing. Make it clear that they can either get something or nothing, so making a deal with you is in their best interest." And don't forget to get the terms in writing!