Whether you're caring for aging parents or a spouse, being a caregiver for family is often about safeguarding your loved ones' mental and physical well-being.

But caring for their financial well-being is equally important. Older adults still need to pay their bills, manage their retirement savings and navigate taxes and insurance. If your loved one needs help managing aspects of their financial life, here's how you can help.

Create a Power of Attorney

One of the first things you should do is work with your loved one to set up a power of attorney. You have several options.

• Financial power of attorney. Financial power of attorney gives you the authority to sign documents, withdraw money, open and close bank accounts, pay bills and cash checks for your loved one.
• Durable power of attorney. Durable power of attorney lets you make financial and health care decisions for your loved one if they become mentally or physically incapable of making decisions for themselves.
• Nondurable power of attorney. Nondurable power of attorney lets you make health care and financial decisions on your loved one's behalf for a set period, regardless of whether they're mentally or physically fit to make these decisions for themselves.

You can work with an elder law attorney to create a power of attorney and ensure that it includes terms your family is comfortable with, including the specific decisions you can make on a loved one's behalf and what happens if you're unable to execute these responsibilities. Getting everything on paper and into a legal document will keep you, your loved one and your family prepared and on the same page.

Get Access to Their Financial Documents

Once you've created a power of attorney, make sure you have access to or copies of your loved one's important financial documents, such as their bank, Social Security and Medicare statements; home deeds and other real estate information; and details for their retirement accounts. This way, you know where their accounts are, what their income and savings are and what benefits they receive.

Setting up an online account with a financial aggregator could make things easier. Financial aggregators let individuals securely connect their bank, savings and investment accounts to their systems so people can view all their financial information in one place. If you use one of these platforms, protect it with a unique password; don't reuse any of the passwords your loved one uses for their accounts.

Establish a Living Trust

Though power of attorney and a living trust often overlap, it might be a good idea to have both.

Even though a power of attorney is a binding legal document, some financial companies might not recognize it, especially if it was created a long time ago. With a living trust, your loved one can designate you as the trustee so you can easily access their assets, which can include both money and property. The main advantage of a living trust is that you can receive your loved one's assets without going through probate, a complex and often lengthy legal process.

Living trusts can be revocable or irrevocable. With an irrevocable trust, you can't change the terms, except in rare cases, such as if the trustee and beneficiary (the person who will inherit the assets) mutually request to change or end the agreement. Depending on how many assets your loved one has and their personal wealth, a revocable living trust might be the better option, as it gives trustees more flexibility to make changes.

You and your loved one can serve as co-trustees, which means you'd each have to manage their assets based on the terms your loved one outlines.

A living trust comes with tax and legal implications — consult an attorney or a qualified financial professional as you consider this option.

Pay Their Bills on Time

Looking after your loved one's finances while they're still alive is a huge part of financial caregiving. It's especially important if your loved one's been having difficulties handling their finances on their own because they're losing their memory, their health is declining or if they've mismanaged their money.

If your loved one wants to live at least semi-independently, you can help them by ensuring that their bills are paid on time. You can either assume the responsibility of paying their monthly bills yourself, or you could set their bills on autopay and monitor their account balances to make sure there's enough money to cover them.

Most banks will let you set up low-account balance alerts, and you can get them sent directly to your email address or to an address you've set up for your loved one. Your loved one could also add you as a second signer or authorized user on their accounts, which would make financial management easier.

Assuming the Role of Financial Caregiver

Being a caregiver for family is, in many ways, a blessing. But it can also be stressful if your family hasn't taken the right steps to prepare.

Talking about money is difficult, especially when you're caring for aging parents. But it's important to talk to them as soon as possible about how they want to manage their finances as they age and how you can help. Talk to them when they're healthy and still considered capable of making decisions for themselves.

Set aside time, too, to read up on the laws in your state. Seek advice from an attorney, if you need it. The legal considerations could depend on whether you are financially caring for an aging parent or a spouse. For example, in some states, a spouse might have joint ownership of bank accounts or survivorship rights, and assets might automatically transfer to them.

Whatever the situation, make sure your family is prepared. Being a financial caregiver takes time and effort, but it's one of the most meaningful gifts you can give to a loved one.