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Despite good intentions, lending money to friends and family can often lead to some uncomfortable situations.

According to Bankrate’s latest survey of 2490 U.S. adults, 60 percent of Americans have helped out a friend or family member by lending cash with the expectation of being paid back, while 17 percent have lent their credit card and 21 percent have co-signed for a financial product like a loan or rental.

But more than a third (35 percent) who participated in at least one of these activities were negatively impacted, resulting in lost money, a damaged credit score or harmed relationship.

“I’d avoid lending cash and credit cards and co-signing,” says Ted Rossman, industry analyst at Bankrate. “All too often, these situations end poorly.”

Lending cash

Of the three situations considered, lending money was most common among survey respondents: 60 percent report having lent cash to help out a loved one. But it’s also most likely to result in a negative outcome (46 percent). After lending cash to a friend or family member, 37 percent of respondents say they lost money while 21 percent say their relationship with the borrower was harmed.

A good rule of thumb is not to lend anyone any amount of money that you’re unwilling to part with altogether.

If you still want to loan the money, “I would try to go into it with the idea that you don’t want to hurt the relationship,” Rossman says. “So if that means that you’ve got to swallow the money, I think that needs to be your mental state going in.”

Lending credit cards

When it comes to lending credit cards, most people are a bit more reluctant.

Just 17 percent of respondents admit to lending their credit card to a friend or family member. Of those who have, 21 percent lost money, 16 percent say doing so harmed their relationship with the person and 12 percent damaged their credit scores.

This is in line with a 2018 survey from CreditCards.com that found the most common problem people had after lending their credit card to someone was overspending (19 percent), followed by not being paid back (14 percent).

If you’re already in credit card debt, it can be especially dangerous to lend your card to someone. Going further into debt can extend your payoff period and cost you even more in interest, while damage to your credit score may take months or even years to recover.

Co-signing for a financial product

Co-signing for a financial product like a loan or a lease on a rental may not have as direct an impact as losing money that you lend to someone, but it can still negatively affect your finances if things go awry.

According to the survey, 21 percent of Americans report co-signing to help a loved one obtain a financial product. As a result, 18 percent lost money, 21 percent say their relationship with the person was harmed and 20 percent damaged their credit scores.

Parents of adult children were most likely to report co-signing for a loan, at 29 percent. According to another CreditCards.com survey, 45 percent of all co-signers have done so on behalf of a child or stepchild. Helping your child get started on the right foot is a great way to assist the transition into adulthood, but make sure you’re in a secure financial position yourself before putting your credit score at risk.

Other ways to help

It’s often difficult to refuse to lend a sum of money or co-sign a lease for a close friend or family member. But keeping these boundaries can be an important way to prevent money from coming between you and your loved ones.

“Don’t feel pressured to say yes if you can’t afford to,” Rossman says. Instead, find other ways to assist.

Offer advice or recommend tools and resources to help your friend or family member without putting yourself at risk. Instead of lending your own money, talk about available loan options or help them work out a personal budget. Rather than loaning your personal credit cards, discuss secured credit cards that can help them begin building credit. Look into co-signing services and other alternatives to putting your own name on the line.

And if you do decide to help out, make sure you’re willing to consider that money gone for good.

“If you really want to do it, only offer as much assistance as you can afford to lose,” Rossman says. “In your mind, assume it’s a gift and that you won’t get paid back. Let that sink in ahead of time so that a negative experience doesn’t harm your relationship along with your account balance.”

Footing the bill

Aside from lending money and credit cards or co-signing a loan directly, many people also find themselves short-changed when paying a group bill with the expectation of being paid back.

Picking up the bill (then collecting repayment from other group members) is a quick way for rewards cardholders to earn extra points on their spending, and 18 percent report having done so. But the rewards may not always balance out money lost from those who forgo repayment.

Of respondents who have charged a full group bill to their rewards credit card, 70 percent were not paid back at least once. Among that 70 percent, 27 percent say this happens occasionally, 23 percent say it’s frequent and 20 percent have only rarely experienced a loss.

Generation gap

Older millennials (those between ages 30 and 38) are most likely to pay for a group bill in order to rack up rewards: 36 percent of older millennials with rewards credit cards have, compared to just 11 percent adults in older generations.

But they’re also most likely to be stuck paying the full bill amount without seeing repayment. Seventy-six percent of older millennials say they have not been paid back at least once after footing the bill, with 36 percent claiming it occurs frequently.

While using your rewards credit card to pay a large bill can help you earn rewards more quickly, it’s important to consider the risk beforehand. Just as you should account for any losses from lending money to a loved one, you should be prepared to risk losing more cash due to non-repayment than you may earn in rewards.

Methodology

Bankrate commissioned YouGov Plc to conduct the survey. All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 2490 adults. Fieldwork was undertaken between 28th – 30th August 2019. The survey was carried out online. The figures have been weighted and are representative of all US adults (aged 18+). It employed a non-probability-based sample using both quotas upfront during collection and then a weighting scheme on the back end designed and proven to provide nationally representative results.