Is it a bad idea to loan friends or family members money? According to Bankrate.com nearly 50 percent of those who lent money reported either losing that money, or experiencing a damaged relationship with the borrower. You should not even cosign for them, according to Ted Rossman, analyst with Bankrate.
"That may sound harsh but this advice is actually rooted in the data which is that about half the time something goes wrong," Rossman said. "We found that 46 percent of the time, when you lend money to somebody else, there's going to be a negative consequence. Either you are not going to get the money back or your relationship is going to be hurt."
The same goes for cosigning where a lot of people also reported a damaged credit score.
Rossman also the data showed that 37 percent of people who lent their credit card to someone had something bad happened. He says it could make for a rather awkward situation.
"Can you imagine all these awkward Thanksgivings for years to come with that other person at the table?" Rossman asked. "It also leads to a lot of second guessing."
Rossman says if you do lend money, treat it like a gift. Don't lend more than you can afford to lose.