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NEW YORK (CNN/Money) - The New Year is a great time to make changes.

If you spent most of 2004 living paycheck-to-paycheck, you may want to transform more than just your waistline.

You may have already made a resolution to change your bad money habits, but recognizing your problem is only the first step. Fixing them will require a lot of discipline and patience. Today's 5 Tips will help you break those bad financial habits.

Before you can fix anything, you've got to understand your problem. That means self-analysis, says Carlo DiClemente, co-author of Changing for Good and a professor of psychology at the University of Maryland's Baltimore County campus.

Start by examining your basic beliefs. DiClemente suggests asking yourself whether you're conservative or compulsive and understanding the downsides to both.

Compulsive personalities may find themselves falling for the first sales pitch, while a conservative person may fail to take on enough risk in their investments to guarantee a solid retirement.

Think about every angle of your financial life: home, debt, savings, investments and credit cards. Then, make a list of the bad habits you've fallen into with each.

Calculate what your bad habits cost you. If you carry only as much credit card debt as the average American family, or $9,500 according to Cardweb.com, you're shelling out $1,400 every year in interest and fees.

Even if you're too conservative for equities, calculate the gains you missed in the stock market. You might recognize the problem when you acknowledge what you could've gained.

Like any goal, you want to focus on achieving something attainable while keeping the ultimate goal in mind. Tim Wilson, a professor of psychology at the University of Virginia, says instead of starting with the idea of making "sweeping changes," it is better to start with a smaller goal as "small successes breed bigger successes."

If, for example, you have high credit card debt, start with something as simple as switching your balance to a new card with a lower interest rate.

Then work out a plan to pay down a specific amount each month. You can start with a small amount and set your goal higher as you go.

"You may find your plan was not as easy as you thought, so you have to revise it to work for you," says DiClemente.

If you stretch yourself too far, you are going to give up. So, stick to a small goal and celebrate when you achieve it. Wilson says that every change in your behavior will bring a change in your self-image.

Make a few consistent small steps and you will begin to see a change in the way you view yourself. Once you manage to save a little bit of money, you'll start to think of yourself as a saver rather than a spender. That self-image will make you feel obligated to keep saving.

Some people are so intimidated by the stock market that they avoid investing in 401(k) accounts. Or, they let credit card debt build because they aren't motivated to pay it off.

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If you are in this situation, put your finances on cruise control. Instead of worrying about picking your own funds for your 401(k), choose index funds or hire a financial planner to help you.

Log onto www.garrettplanningnetwork.com for a network of financial planners around the country that offer services by the hour.

As for that looming credit card debt, automate your payments on the web so you're forced to pay down a certain amount each month.

As I mentioned earlier, it's not always easy to see you have a problem. Keep evaluating your financial life and realize that breaking one bad financial habit proves that you can tackle your other money problems.

When you take care of that credit card debt, start in on your student loans. From there you may want to save for a home and your kid's education.

Once you get a taste of success, you'll be eager to tackle new money challenges.  

Gerri Willis is a personal finance editor for CNN Business News and the host for Open House. E-mail comments to 5tips@cnn.com.