If I don’t plan to make any big purchases (i.e. house, car) in the next seven years and I clean up my credit during that time, does it really matter that I currently have bad credit?
Yes, it does. Remember: Your credit can be viewed by your employer(s) and your insurance companies. You can lose out on a job and even have your insurance canceled because of poor credit. Additionally, your existing credit card issuers can view your credit and increase your rates and credit limits if they feel your credit risk has worsened. This is called Universal Review or Universal Default. (Thanks to new provisions in the CARD Act, however, consumers will soon have increased protection against interest rate hikes on your credit cards). This doesn't change the fact that your low credit scores will effect your life in the short term in quite a few important ways.
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