All Articles

Advantages to Offering a Lifestyle Spending Account

With today’s tight labor market, employers must look for new strategies to remain attractive for prospective and current employees. Offering a Lifestyle Spending Account (LSA) to employees gives employers the opportunity to customize a unique benefits package for their workforce outside of the traditional realms of FSAs and HSAs. The account is a post-tax, employer-funded account that is unique in its ability to offer very specific reimbursement on costs not typically covered by a group health plan.

There is a range of different items and experiences that could be reimbursed with an LSA, and the offerings are customizable for what the employer sees fit for their specific workforce. For example, an LSA can be set up to pay for the following:

  • Gym, health club, spa and fitness studio memberships
  • Nutritional counseling and weight loss programs
  • Financial planning services
  • Marriage and family therapists
  • Home repair services
  • Grocery and meal purchases and delivery
  • Charitable experiences
  • Personal travel expense
  • Personal development (music and/or art lessons)
  • Sporting events
  • Hotels and lodging

While the opportunities for what costs can be covered with an LSA are extensive, employers have the flexibility to decide what they are willing to reimburse and how much they are willing to contribute. Depending on how the employer chooses to set up the LSA, employees may also be able to split up their expenses into different categories.

By prioritizing the mental and physical health of their employees, employers remain competitive for job prospects and also keep current employees satisfied, improving retention within the company. An LSA has the ability to offer a very well-rounded employee benefit package that covers every aspect of life outside of the basic offerings found in traditional plans.

Real-Life Example

To better understand a situation where an LSA could be useful, consider an employee who is interested in getting bariatric surgery to improve their health. While the surgery itself could be covered by group insurance with an FSA or HSA in place to assist with the medical out of pocket expenses, those benefits generally end upon the surgery’s completion. After surgery, the employee will find it necessary to change the way they look at nutrition for the rest of their life. 

An LSA could help fund and support the employee’s change in lifestyle by reimbursing costs for workout classes or outdoor activities that promote healthy living.

With an LSA, employers can take their support one step farther than traditional health care costs, improving the health and happiness of their employees all across the board.


For more information about how to curate LSAs for your employees, contact us.

This website uses cookies. By accepting the use of cookies, this message will close and you will receive the optimal website experience. For more information on our cookie policy, please visit our Privacy Policy.