Sidebar spacing problems

Hello All!

I’ve decided to update the look of mt family blog and switch to a K2 theme that supports sidebar widgets. I’ve edited the sidebar.php file before but this was with themes that did not support the use of widgets. So far I think it looks great except for the spacing in the sidebar. If you take a look http://www.coreyfwilson.com you can see that the links and categories are kind of bunched together. Which file do I need to fiddle with to fix this? Is it the sidebar.php file within the theme?