Leveraged basically means investing borrowed money. Leveraging has the effect of amplifying whatever gains or losses you experience. Houses are traditionally highly leveraged investments. You “buy” a house for only about 10% of the cost up front (or, more recently, none of the cost). If it goes up in price 10%, you just made 100% on your money. But if it goes down 10%, you just lost everything.
Generally, though, since money is fungible, you can consider how leveraged your entire financial portfolio is, not how leveraged an asset is. In general, any time you have both debts and assets, you are leveraged to some extent. Consider two individuals, one with $100K in debts and $110K in assets, and one with no debt and $10K in assets. Both have the same net worth, but the first is much more leveraged than the other.
Leverage can be a good or bad thing, depending on how you use it, but it is almost certainly a bad thing if you have high interest debt and low-return investments. In your case, consider your retirement accounts. I don’t know how retirement accounts work in Canada, but unless you get some absurd tax/employer contribution advantages from the retirement account, it’s a poor plan to pay into the retirement account at the same time you have consumer debt. Think of it this way: If you had no retirement savings, would you borrow on your credit cards at 15 or 20% in order to put the money in your retirement account? Probably not. What about your other assets? If you had a lesser car than you drive right now, would you borrow on the credit cards to buy a better one? If not, then sell the car and pay those debts. The car probably wins out over the retirement account, because it has a lower rate of return (negative, probably), but they’re both a worse deal than paying off the debt.
For an example of where leverage can be a good thing, I’ll use one that I see among my contemporaries. An individual’s got $15-20K in edu loans, but is paying them off as slowly as possible, while putting money in a retirement account and making other investments. Why? Because they got a very low rate on those loans, and can make more money even with conservative investments like CDs (even after taxes) than by paying off the loans. Note that because of the conservative investments, in this case the leveraging of assets doesn’t actually increase risk, although that’s not usually the case.
If that was unnecessarily simplistic, I apologize. FWIW, I agree with those who say to get a lower rate on that debt as soon as possible, and to continue living below your means to pay it off as soon as possible.