Here's why you shouldn't lend money - there's a 40% chance of never getting it back

And if your brother wants to go to the footie with you, but doesn’t have the money, would you be there to lend him what he’s missing? If someone close to you is struggling, would you lend the cash they need?

Even though many of us are struggling to make ends meet, we are often only too willing to stump-up cash when someone we love is in need.

In fact, Debt Advisory Centre’s own research shows that a third of Brits say they have lent money to friends and family in the past year alone – totalling an enormous £1.6 billion.

While the average amount lent was around £100, a generous 1 in 10 people said they had lent more than double this amount.

Putting your hand in your pocket to help out a family member is very common across the UK. What is less common is actually seeing the loan repaid – and many people find it very hard to raise the subject of an unpaid loan with a family member.

Of the family lenders who took part in the survey, two-fifths said they didn’t expect to be repaid.

But could this selflessness ultimately put a strain on their relationships?

To avoid the possibility of misunderstandings and bad feeling it makes sense for both the lender and the borrower to agree a firm arrangement up front on exactly what will be repaid and when.

Overall, two-fifths of respondents said that the amount of money they lent someone would determine whether they tried to get the money back. Worryingly, a quarter of people revealed that when they do lend money, they never try to get it repaid.

Many of us find it awkward to discuss money with those closest to us. Consequently, just over 15% would drop hints to the borrower rather than ask them directly for the money to be repaid.

A further 15% are not so shy and retiring. They agree a repayment date when they hand over the loan and start chasing anything that has not been repaid as soon as they can.

Surprisingly, younger people are the most likely to lend to members of the family. More than half of 18 to 24-year-olds said they have given a loan to a relative in the past year, compared to a quarter of 45 to 55-year-olds.

Many of us would like to be able to help if someone we care for is in need of a financial helping hand. However, it’s important this help doesn’t come at the expense of your own financial wellbeing.

If your finances are already stretched, it’s best not to lend money. Afterall, it could put a strain on your finances and your relationship.

Debt Advisory Centre: 0161 871 4881