1. Create a budget, immediately...everything that must be paid, but bare, bare bones only......make sure taxes, medical insurance and things like that are calculated properly and included.
2. She has to take the extra cash and start making more than the minimum payments. Rank the cards by interest....Pay a little more than the minimum on each card and on the highest interest card as much more than the minimum as possible.
3. No new credit for anything...everything must be paid by debit card and checks. Avoid ATM fees at all costs. Put the cards away in a safe place. DO NOT CANCEL THE CARDS.
4. You have created STABILAZATION. There can be no backtracking on this. Budget must be updated monthly or sooner.
5. GET the Credit Report and learn how to read it. File any corrections if necessary. Get the credit score. This may cost $20 -30 bucks but it is worth it. The credit report can be gotten free.
6. Try to set up a small savings account but remember, paying off debt is the same as savings.
7. Get on the phone and call each card company, ask if you can get a lower rate/different card from them. Tell them what you are trying to do and that you are shopping around to transfer balances. If they see you are paying (good credit) and see you are paying more than minimums, they will deal with you because they don't want to lose you.
8. Search for the best deal you can find for the lowest interest rate and lowest transfer fees. A personal bank loan might be wise to look at. DO NOT APPLY repeatedly for new credit. READ what affects your credit report.
9. Step by step every other month, do something to reduce those interest rates, repeat steps 7 and 8, and keep that budget to the bare bones while increasing payments above the minimum more and more on each card and ALOT where can on the highest interest card.
10. Torturous at first but in six months you'll notice a difference. In one year a big difference. Pull your annual credit report, pull the score and go back to step 1 to prepare the year 2 plan.
This is like eating and sleeping and working...you work on your credit every day, in the way you budget, spend, and control and know things.
This is a plan for someone like your sister who is NOT over her head, missing payments, and with bad credit...that is a different matter.
The Big Boo
I am curious as to why you say don’t cancel the cards? It seems to me if one doesn’t have the discipline to not the use cards, keeping them open is just an unnecessary temptation.