In which version of SQL you are facing the error, developer edition or in sql express????
Pls try the following
To change the authentication mode to SQL
1.) Change the registry value as said by Brain
2.) Restart SQL services.
3.) Try connecting with SQL authentication
If you get the error "Login failed due to incorrect password", then try the below steps.
FOR Developer Edition
In command prompt do the follwoing
1.) sqlcmd -E -S. -A press enter
2.) sp_password null,your_new_sa_password,'sa' press enter
3.) go press enter
Then try connecting with the new password
FOR SQL Express edition
By default DAC is disabled in SQL Express, hence
1.) Add -T7806 flag in SQL startup parameter to enable DAC, restart SQL Express
2.) Do the steps mentioned for Developer edition
Try with the new password.