According to Finder, 79 per cent of Australians made a New Year's resolution at the beginning of 2020, with a quarter of these vowing to get out of debt.

If your financial goals for 2020 were a flop, you are not alone. Last year was challenging for most, but with expert advice and guidance, 2021 can be the year you take back control of your budget.

We spoke to Behavioural Psychology Specialist Kris White about common barriers to achieving New Year's resolutions, and how science and psychology can help you come out on top.

Mindless to mindful spending

Resolution rain check: We think we can only achieve our goals if we sacrifice the things we love or enjoy.

Use psychology to: Understand what really adds value to your life to make better financial choices.

If you have clothes in your wardrobe with the tags still attached or shoes wrapped in their box, you may have fallen into the bad habit of mindless spending. Mindfulness might offer help in better understanding your spending habits so you can reach your financial goals faster.

Start by reflecting on your relationship with money and evaluate where and why you spend the way you do. Look for the underlying motivations and values behind how you use your money. This way you can say ‘yes' to the purchases that are meaningful to you and avoid incidental spending that stops you from getting ahead.

Kris explains that real change is about understanding your identity and values. "Becoming better with money requires a new way of thinking about who you are and what will actually make you feel happy and fulfilled."

To make financial resolutions stick, Kris says you must hold yourself accountable.

"Write your financial resolutions and aspirations down and, importantly, include why they matter to you. Pledge them, hang them on your fridge or sign a document so you are reminded of your goals every day," he suggests.

Focus on small, incremental goals

Resolution rain check: We give up when we don't immediately see progress.

Use psychology to: Retrain your brain to focus on your next incremental goal.

"Don't get frustrated at a lack of progress - your savings goals are probably not going to be achieved at the end of January. Most things that are worth your time, such as self-improvement, relationships, career, health goals and becoming more financially savvy, all take time," says Kris.

Thinking about the long-term benefits of doing the right thing does not always go with the grain of human behaviour. Instead, try focusing on micro goals and incremental milestones to track your progress.

When setting these measures for success, be sure to seek advice from experts or experienced family and friends so you know your goals are achievable.

Plan to fail and power on

Resolution rain check: One slip-up equals complete failure.

Use psychology to: Mentally prepare to manage mistakes.

If you are blindsided by a bill or have an unexpected night out, don't let it derail your entire year's goals. You do not need to throw in the towel just yet.

"We're human and we should expect slip ups. Instead of beating yourself up when you have a blunder, remember to keep in mind all the little successes that you had throughout the year," says Kris.

According to Kris, what really matters is what you do after a financial fallout.

"Instead of telling yourself, "this is difficult", "I'm too busy" or "I'll think about it next year", realise that your journey is all about learning from failure. Expect it and reset your plans so you can move forward quickly," concludes Kris.

If you have any queries or want to chat more about the features of your loan, our Customer Care experts are on hand to help. Please contact Customer Care via customercare@homeloans.com.au.

The opinions expressed in this article are the opinions of the author(s) and not necessarily those of homeloans.com.au. The above is general commentary only and is not advice tailored to any individual's financial situation. We recommend seeking advice from a finance professional before implementing changes relating to your finances.