About a decade ago, a new type of fundraising emerged that allowed large groups of people to donate small amounts of money to support artists and their projects. Since then, popular sites such as Kickstarter and Indiegogo have collected millions of dollars and helped people launch businesses and political campaigns, produce studio albums, and even pay for personal vacations.

Recently, crowdfunding has also helped pay medical bills. That's what Erin Lennox and her father, John, who has Parkinson's disease, are doing. The 61-year-old carpenter has only worked sporadically in the four years since his diagnosis, and his state disability benefits haven't kicked in yet. To cover the gap, Erin established an account with a crowdfunding site and set a goal of $15,000.

Do your homework. Crowdfunding is not without risk, says Bruce McClary, vice president of public relations and communications at the National Foundation for Credit Counseling in Washington, DC. "It's important to understand the terms and conditions and be aware of red flags," he says.

Some sites charge fees, for example, or take a percentage of the funds raised. Learn as much as possible about the sites, their focus, and operating rules beforehand.

Identify your options. Some general crowdfunding sites, such as GoFundMe and Indiegogo, have helped families raise money for medical care. Others, some of which bill themselves as compassionate crowdfunders—sites designed for humanitarian and charitable causes—include YouCaring, Fundly, and GiveForward.

Read the fine print. "Find out what percentage of the money raised goes to the crowdfunding site and whether that percentage goes up if you don't meet your fundraising goals," says McClary. Determine if you have to pay taxes on the money you raise. If so, meet with an accountant to see if you can set up the account as a charitable fund and make donations tax-deductible—and avoid being liable for taxes yourself. Funding sites and policies differ, so don't make any assumptions. And investigate whether you will have to pay any other fees, such as service charges, beyond a percentage of what you raise.

Use social media. If you opt for crowdfunding, craft a strong story and create a video that conveys your needs. Express your hopes for what the funds will accomplish and use social media to keep the story in the minds of would-be funders, advises Roy Morejon, founder and president of Command Partners, a digital marketing firm in Charlotte, NC, that specializes in crowdfunding startups. Morejon also suggests adding a "share" button that allows people to forward your story to others and expand your circle of potential donors.

Know the risks. Families desperate for cash may not be aware of the risks of crowdfunding, such as revealing personal information about their finances and health online, says David Taragin, MD, a neurologist at the Neurology Center in Silver Spring, MD. McClary agrees. "Strangers will be looking at the site and you are putting out information in a very public way," he says.

In addition, some sites may actually be scams, putting victims at risk of losing money and enabling access to their bank or credit card information, McClary says. He recommends visiting a crowdfunding review site like CrowdsUnite, which provides information on crowdfunding as well as user reviews of crowdfunding firms. You can also contact the Better Business Bureau in your state or the Attorney General's office to see if any sites have had claims filed against them.

Consider the upside. For Erin's father, the experience has been an unexpected source of support. The donations and comments from people who visit his crowdfunding page have boosted his spirits. As Erin wrote recently on their YouCaring page, "Dad has read every single comment through tears (the good kind!)." And the two have reached their goal of $15,000.

Explore other options. If crowdfunding seems too risky and you mainly need day-to-day help with a temporary medical or health crisis, consider informational sites like Caring Bridge, Lotsa Helping Hands, and What Friends Do. All three sites protect users' privacy by limiting access to people who have been approved by the family or their designee, and by requiring visitors to use a password to access information such as patient updates. The sites also allow friends to sign up to make meals and do errands. Friends who can see what you need may, in turn, round up others to help donate or raise funds.

Crowdfunding may not raise all the money you need, McClary says. If you fall short of your goal, don't borrow against retirement funds or use high-interest credit cards, he says. Instead, liquidate personal items and reach out to association charities, family members, or houses of worship to see if they can help.