A Lifestyle Spending Account (LSA) is a post-tax benefit solution designed to meet the diverse needs of today’s workforce. Unlike traditional spending accounts, LSAs provide unparalleled flexibility, allowing both employers and employees to tailor their benefits to suit individual preferences and lifestyles.
An LSA is a versatile spending account that reimburses employees for a wide range of expenses aimed at promoting physical, financial and emotional wellbeing. Unlike conventional benefit programs that come with strict rules and regulations, LSAs offer freedom of choice, both to employers and employees, making them an attractive option for a unique, modern workforce.
Key benefits of LSAs
Diverse reimbursement options
LSAs can address diverse employee needs across a variety of categories. Some reimbursable options for employers to consider include:
- Gym, health club, spa, fitness memberships
- Fitness trackers and apps
- Weight-loss programs
- Pet care (e.g., walkers, day care, grooming)
- Fees for wellness app subscriptions
- Student loan reimbursement
- Identity theft services
- Home office, technology needs, cell phones
- Learning and development (e.g., classes, enrichment)
Flexible benefit levels
Employers can determine benefit levels, allowing them to customize the LSA offerings to match their organizational goals and budget.
Enhanced employee satisfaction
By providing a benefit that caters to the unique needs of each employee, LSAs can boost employee satisfaction and engagement.
Support DEI goals
LSAs offer personalized benefits that cater to the diverse needs and preferences of all employees, ensuring equitable access to resources that promote their physical, financial and emotional wellbeing.
Promote a healthy workforce
Employees have the flexibility to choose and be reimbursed for activities and services that enhance their wellbeing holistically.
Attract and retain talent
A customizable benefits package enhances job satisfaction, engagement and loyalty to an organization.
Address affordability goals
Employers control and set benefit levels that align with their budget, while giving employees the freedom to choose cost-effective options that best meet their personal wellbeing needs.
How LSAs work
- Employer contribution – Employers decide on the benefit amount allocated to an employee’s LSA.
- Employee reimbursement– Employees submit claims for eligible expenses, which are then reimbursed through their LSA.
- Tax considerations – LSAs are post-tax accounts. This simplifies administration and avoids complex regulations associated with pre-tax accounts.
The Lifestyle Spending Account is a forward-thinking solution that reflects the evolving needs of today’s workforce. By offering flexibility and choice, LSAs can enhance employee job satisfaction and promote a more dynamic and inclusive workplace environment. Consider implementing an LSA in your organization to provide a valuable, customizable perk that truly benefits your employees.
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| Title | File Type | File Size |
|---|---|---|
| Lifestyle Spending Account (LSA) | 1.2 MB |
