What should I do?

First of all, I'm 21 yrs old. I went from having no credit, to having bad credit. The reason is because I got sick and didn't have insurance so they're all medical bills. The other one is late fees from the Public Library. I decided I needed to start paying some off. I don't make very good money at work so I knew it would be tough but I'm so desperate to have good credit I felt it was worth it. But then someone told me that even if you pay it off, it still stays on your credit report and it still affects it. So then should I just not pay and wait until it comes off my report in 7-10 years or pay it and still have it affect me? What is better? I want to atleast have good credit by the time I'm 30.
Additional Details
Is it better to just not pay the stuff and better my credit in other ways? Is this possible?

It took a long time for your credit to get this bad, and it will take a long time to improve it. Paying what you owe, or at least beginning to pay will help you. Contact each of your creditors and work out the best agreement you can. Even though it will take time, it will be a lot faster than waiting for everything to drop off your credit report.

Alright Allison, let's tackle this, shall we?
First of all, are you medical bills and Library dues reported to collection agencies yet? If not, it's going to be A LOT easier.
I'm going to assume "yes" on that answer, however. If I'm wrong, click on my avatar and send me an email. I will be glad to help you work through this.
First thing you need to do is find who you owe money to. If you don't know, go to http://www.annualcreditreport.com and pull a free credit report from each of the three major credit bureaus. There are A LOT of hoops to jump through in order to do this, however, if you think like I do, it costs nothing but time to do this. If you are able to do it over the Internet, make sure you print it out, as you aren't able to get another free one for a year.
Now then, you should have your creditors available right in front of you.
You now need to write and contact your creditors. Make sure you send all documents and checks registered mail, return receipt requested. This WILL cost more, but will aid you later.
Write to the creditor, explaining that you are willing to set up a payment plan, and that you want the collection account deleted from each of the three major credit bureaus after the debt is satisfied in full. Tell them a payment plan that you are willing, and able, to make from month to month. At the conclusion of your letter, tell them you want from them in writing the agreement. Do not sign your letter, just initial it. Here's a sample letter:
Your address

Their address

Dear XYZ Company,

I am writing to you in regards to account number 12345ABC. I am neither confirming nor denying that the debt is mine. According to the records that are in my possession, I owe $100.00. I am willing to set up a payment plan of 20 dollars per month for the next 5 months to satisfy this debt. As part of the agreement, once the debt of 100 dollars is payed in full, you agree to report and delete to the 3 credit bureaus, Transunion, Equifax, and Experian, account number 12345ABC.
Please mail me confirmation or denial of these terms.

Yours truly,
(Your initials here do not sign your name)

John D Smith

Do not renege on your agreement. They've already agreed to delete the debt if the debt is satisfied. If you can, try and take care of the smaller account first, that way you can see progress. Yes, it sounds weird, but it will make you feel better.
Do NOT start sending ANY money until you get back, in writing, your agreement.
Keep copies of EVERYTHING you send, as well as any correspondence they send. Also, make sure you pay with a personal check and keep all copies of cleared checks. That way if they renege on YOU, you can dispute it with the credit bureaus, and get it taken off your credit report.
If they won't agree to delete it, it will be deleted off your credit report seven years from the day the debt was first incurred. Anybody who tells you otherwise is talking hogwash. Look up FCRA and see your rights.

If you have a debt that you can pay off in full at once, write them and ask them to settle for less. Lowball them and work your way from there. They may settle for as low as 40 percent, depending on how much they bought the debt for.

Allison, did you read all the responses to the question you just asked a few minutes ago?

Ok, here is what you do. Find something you like - something you really enjoy. See if there is an opportunity to work part time doing what you enjoy. Take every penny you earn and get debt-free. Then go a step further and save $300.00 and get a secured credit card that reports to all 3 bureaus (equifax, experian, trans-union). That, alone, will raise your score 30 points. Then open a savings account at the bank - more points. Next time you need an appliance or new tv (that you have the money for from your part time job) apply for credit at the Point of Sale. They may issue you credit - more points. Above all, keep up to date on all of your bills and never fall behind again and you will be off to the races.

Pay it off as soon as possible.

Take financial responsibility and PAY any debt owed. Establish a monthly budget for income and expenses and plan to make regular monthly payments for debts owed. You can get FREE information on the basics of Banking and Savings at major Bank websites like www.wellsfargo.com or www.bankofamerica.com You want to show good faith re-payment on your debts owed you may think its easier to walk away or 7-10 years of a blemish on your Credit Report. However, you are young and sooner or later you will want to purchase a Home or Car or get a Student Loan so you need to establish and maintain a good payment history and credit report history. You can do it and GOOD LUCK! "-)

Think about how you would feel if someone owed you money and didn't make any attempt to pay them. Would you do all you could to make life difficult for them? Others will. Morally, its your debt and your responsibility. We hear of financial responsibility; well, it starts here. Contact them all and offer a payment schedule that you are able to stick to. Second to wanting payment, creditors are more receptive to communication. At least they know that an attempt is being made. Next, obtain a copy of "Richest Man in Babylon". Probably the best book about getting out of debt and changing your life around.

You should always pay your debts. You are well-spoken and obviously a smart person, so know that letting it go will hinder your credit in a large way. I understand about the medical bills; just went through the same thing in a big way with brain surgery. Got through it just fine, and so can you. Do the right thing. You can do it, even if it's just $20 per month.

It doesn't "come off your record" until 7-10 years AFTER YOU HAVE SETTLED IT! So you need to pay off all your debt within the next two years if you want "good credit" by the time you are 30!

Sorry!

You seem to think that if you DON'T pay the money you owe, your creditors are going to stop asking for it for some reason! If I owed you $1000, how long would it be before you stopped asking for it back?

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