Employees can access options through a curated marketplace, and the platform integrates with HRIS systems. “People have gotten pretty lax with what they’re using it on because Joon doesn’t really restrict what the reimbursement is.” — People Operations leader, small B2B software company Admins also complain that the broad categories make it difficult to enforce spending rules, and that features like automated offboarding are absent (necessitating manual tracking when team members leave).
Flexible Spending Accounts
They can contribute pre-tax dollars alongside employer contributions, keeping track of their expenses throughout the year and submitting claims for reimbursement. Understanding how a Lifestyle Spending Account (LSA) works is essential for both employers and employees. They also support educational pursuits, allowing employees to pay for courses, certifications, and training programs that advance their careers.
Top Lifestyle Spending Account Vendors and Software
Globally accessible with support in multiple languages and currencies Delivering benefits that are relevant, inclusive, and easy to manage. Access templates, toolkits, and resources designed to support program adoption. Read about past Espresa clients and their experiences. Streamline reimbursements, allowances, and LSAs for your entire workforce. Discover proven strategies to slash your time to hire and secure top talent efficiently!
Medcom Benefit Solutions
Discover 15 fun activities for heart health awareness to promote heart health at work, raise awareness, and inspire employees with actionable initiatives. Discover the benefits of an annual wellness program vs. a one-time challenge and determine which approach drives lasting behavior change and engagement. Explore the role of corporate wellness committees in promoting employee health, enhancing workplace culture, and implementing successful wellness programs. Level offers a streamlined benefits experience with an employer-funded card for direct payments on eligible items, eliminating the reimbursement process.
- A Lifestyle Spending Account (LSA) is an employer-provided flexible benefits account that supports diverse workforce needs.
- Most companies offer LSAs to full-time employees, but some extend access to part-time or contract workers as part of broader retention or wellness strategies.
- Traditional benefits are often employer-mandated, whereas LSAs empower employees to choose what aligns best with their individual preferences, fostering higher engagement and satisfaction.
- If the platform is clunky or confusing, employees simply won’t bother using their funds, leading to low engagement and wasted spend.
Simplified administration
These solutions can also be used to manage existing fringe benefits such as healthy meals, pet care expenses, and more. At the same time, it gives employees the freedom and flexibility to make their own choices about how to improve their lives. This type of account can be a great way for organizations to show their employees that they care about their well-being. Funds can be used to cover any expenses related to the employee’s lifestyle choices, as long as those expenses fall within the defined parameters. The key feature of an LSA is its flexibility, allowing employees to choose how to best use their funds based on individual preferences.
Others mention that unused points are hard to redeem because of high minimums on rewards, and employees cannot convert balances into open-ended gift cards. Finally, because this approach is more passive, you’re less likely to see employees utilize the benefit — especially if they have privacy concerns related to linking their personal card. A newer player in the LSA market, Joon takes a modern approach by letting employees link their personal credit or debit card. Even when accepted, purchases that combine eligible and ineligible items often get declined outright, creating extra friction compared to reimbursement-first platforms. And because ThrivePass operates within a curated marketplace, employees don’t have the freedom of choice; they’re limited to approved vendors rather than being able to spend anywhere. Larger companies also like the ability to white-label their benefits program.
It provides employees with flexibility in how they use their benefits, giving them access to a wide selection of vendors and services. The provider also offers an employee debit card, giving participants quick access to their benefits funds. Ameriflex is known for its straightforward and user-friendly platform, which makes claim processing simple for employees. Wellable stands out for its emphasis on customization and flexibility, enabling employers to design wellness initiatives that match specific employee needs. Once launched, employees access the Fringe Marketplace and select benefits that mean the most to them. Fringe is a well-being marketplace that gives employees access to 130+ lifestyle benefit vendors.
Whether it’s pre-tax or post-tax benefits, employer contributions, or country-specific tax regulations, Forma manages it all—eliminating risks and reducing administrative complexity. One of the biggest challenges businesses face is handling tax compliance for various benefits. Companies no longer need to juggle multiple vendors, track reimbursement requests manually, or handle complex tax compliance issues — Forma automates and streamlines these tasks.
These can range from fitness memberships and mental health support to home office upgrades and learning opportunities. LSAs differ from traditional employee benefits in that they offer greater flexibility and customization. Employees typically have the freedom to choose how to spend these funds within predefined guidelines, offering greater choice and customization compared to more rigid benefits programs. Unlike traditional benefits, LSAs offer a broad range of categories such as fitness, wellness, professional development, and even travel. For companies ready to move beyond rigid benefits packages, our solution transforms the LSA from a standard perk into a strategic advantage that measurably improves engagement and retention. While the LSA market has grown increasingly crowded, we’ve maintained our focus on what truly matters — giving employees the flexibility they want while making administration effortless for HR teams.
Lifestyle spending accounts offer financial benefits that can boost your take-home pay and save you money on taxes. These accounts are a versatile benefit that helps employers cover various types of expenses employees face in their daily lives. Wellable also provides Lifestyle Spending Accounts (LSAs), allowing employees to use funds for health and wellness-related expenses.
Espresa
According to benchmarking data, Compt users utilize their LSA/stipend funds at more than 70,000 different vendors, with 70% of spend going to independent and local vendors. Founder and CEO Amy Spurling is a three-time CFO and two-time COO, so she literally built Compt with HR and Finance in mind. Each overview includes why the platform is notable and what limitations to consider. They’re a core feature of people-first benefits design, as evidenced by their increased adoption across every company size.
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Convenient reimbursement options
- Ameriflex is known for its straightforward and user-friendly platform, which makes claim processing simple for employees.
- A Glassdoor survey revealed that 94 percent of employees seek benefits that significantly improve their quality of life, health, and well-being.
- Also, some LSA plans may have a “use-it-or-lose-it” policy, meaning any unused funds at the plan year’s end are forfeited.
- This flexibility ensures higher benefit utilization rates, improving overall employee satisfaction.
It’s also suitable for a globally distributed workforce, as it’s available in all languages, time zones, and currencies. Espresa offers a wide range of eligible spending categories and an integrated marketplace with zero markups. Fringe is a popular platform that scores 4.6 out of 5 from the G2 user community (0.2 lower than Benepass.)
Step confidently into the future of HR tech with Compt lifestyle benefits where flexibility is limitless (or limited – the choice is yours!) and personalization is paramount. However, Compt cannot provide tax advice, and users should consult their own tax, legal, and accounting advisors when necessary. For instance, some companies might provide a smaller stipend to part-timers or have different LSA amounts based on tenure or location. Because an LSA is an employer-funded, post-tax benefit (not a regulated pre-tax account), there aren’t rigid government rules about eligibility like there are for 401(k)s or HSAs. Compt’s LSA solution has no preset vendor lists; it’s a vendor-free, open-choice model, so employees can seek out the products or services that best fit their needs. Employers define broad categories (aligned with their culture and what their people value), and employees then have freedom to spend within those categories.
Honeybee allows businesses to deposit a predetermined amount of money into employee Allowance Accounts monthly. Compt’s Employee Stipends program enables businesses to offer employee perks that align with their culture and attract talent, all without the complexity of DIY perk programs or point-based systems. Employee reimbursement initiatives pose a considerable strain to already overburdened HR personnel. ABS takes a hands-on approach to simplify and deliver solutions that eliminate the bother of employee benefit management. Fitness, mental health, financial well-being, nutrition, and continuous learning solutions are among the many options.
Are Lifestyle Spending Accounts Taxable?
During these workshops, HR representatives explain LSAs, including how they work, the benefits they offer, and the eligibility criteria. Employees would log into the portal during the annual benefits enrollment period to review their benefits options. To integrate LSAs into their benefits offerings, the HR department can update the benefits enrollment portal to include information about LSAs. With JOON’s LSA software, employers can customize allowances, eligibility, and schedules for each merchant. Benepass LSAs can be used to attract and retain talent, cater to a diverse workforce, and save time and money. From seamless integration to customizable features, these platforms offer everything you need to implement LSAs successfully and empower your workforce.
The provider should offer a modern user interface, a well-designed mobile app, and simple reimbursement or direct payment options to enhance the employee experience. A great LSA provider should offer customizable spending categories that cater to the diverse needs of employees. It allows employees to spend their stipends freely while keeping employers compliant with IRS rules. Nava is a modern benefits brokerage that partners with employers to design employee-centric benefits programs.
Because LSAs are post-tax benefits, the platform you choose should help you administer them in line with IRS and local tax rules. At the same time, verify that the provider is prepared to protect your company and employees on the compliance front. The best LSA providers offer convenient ways for employees to spend their stipends, particularly a seamless reimbursement process for purchases. When employees have the freedom to choose benefits that fit their lives, engagement soars. Selecting aviator game download the best Lifestyle Spending Account (LSA) provider is all about finding a partner that aligns with your company’s goals and elevates your employees’ experience.
Transactional Accounts
These accounts can be used for fitness and wellness programs like gym memberships, yoga classes, and mental health services. A Glassdoor survey revealed that 94 percent of employees seek benefits that significantly improve their quality of life, health, and well-being. Reliable customer support ensures that both employees and HR teams receive timely assistance. For companies with international teams, choosing a provider that supports employees across multiple countries is essential.