It depends on what you mean by 'hurt'. It will not disqualify you from borrowing up to $38,500 per year in unsubsidized Stafford loans. However, you many not be eligible for subsidized loans depending on how much it is and how much subsidized dollars your school will dole out. It might make you ineligible for some institutional need-based aid.
As far as hiding in the mattress, you can do that but they will ask you specifically about savings, cash, investments, etc...so you are kind of obligated to report it on the FAFSA. You can give it to your sister, but realized there may be some tax implications to gifting large amounts of money (over $11,000). It is likely illegal to just not report it...unethical?, well I guess that is up to you.