Lifestyle benefits are aptly named — employees want benefits that supplement their lifestyle as part of their overall benefits package. Offering tangible lifestyle benefits not only helps your employees financially, it also makes them feel understood and valued by their employer. Lifestyle spending accounts are a great way for employers to offer versatile lifestyle benefits by allowing employees to choose which benefits they want to take advantage of.

As economic conditions fluctuate, employees are facing rising costs in everyday expenses such as transportation, parking and wellness services. Inflation continues to impact disposable income, and many individuals are balancing discretionary spending with the need to manage debt and savings. With the cost of living on the rise, employees are looking for ways to stretch their earnings while maintaining their lifestyle and well-being.

LSAs can help ease this burden by offering flexible, employer-funded benefits that support a range of personal expenses — from fitness and wellness programs to commuting costs and professional development. By integrating LSAs into their benefits strategy, employers can provide meaningful financial relief and enhance overall employee satisfaction.

Determining which lifestyle benefits to offer can be a difficult decision for employers. A good way to begin this process is to poll employees to understand which benefits they will actually use. Another way to ensure that lifestyle benefits will actually be used is to make them customizable or to offer a lifestyle spending account.

For example, an employee who works remotely will likely have different needs than an employee who commutes to work every day. The remote employee might want help with their internet bill or office supplies, while the commuting employee might want help with gas, public transportation expenses or parking.

It is also important to ensure that employees understand their options when it comes to LSA offerings. Often we see employees neglect LSA coverage because they don’t understand which expenses are eligible or how to allocate the funds properly. Providing an instructional demonstration or even a meeting with a human resource professional could help employees feel more confident when opting in for these benefits.

Read more about the evolution of lifestyle spending accounts here.