Battered and buffeted by the pandemic, inflation, recession, and mounting debt, employee financial wellbeing seems under assault.
Under these stresses some have taken a harder look at what they expect from an employer—better pay, yes, but even more so the level of flexibility in the supports and benefits the company provides.
So, organizations themselves are rethinking their financial wellbeing programs – and considering innovative ways to help individual employees pay for immediate needs without significantly increasing benefit costs.
Can these programs really make a meaningful difference in people’s lives and help them to pay for things they need?
Surprisingly, yes.
Lifestyle spending accounts (LSAs) are a flexible solution that offers employees a “subsidy” to meet covered expenses—like fitness, social memberships, emergency savings, and stress management services, home internet service, food delivery service, tutoring costs for children, summer camp costs, new appliances, new tires and car repair services, and so on.
And LSAs offer three powerful incentives to employees and employers alike.
- Takes the pressure off. Day-to-day worry about these expenses clearly affects both the attitude and the productivity of people at work. A well-structured LSA that tackles these concerns goes a long way to restoring workplace wellness and retaining valued employees.
- Enhances your engagement strategy. An employer can choose the activities, products and services the company wants to cover by the LSA, and the subsidy amount, that tie in with specific problems within the workforce. The key is to address the HR and benefits problems and needs facing the specific workforce.
- Puts them in control. Participants choose when and for what to use the subsidy, normally by incurring the expense and submitting a request for reimbursement (although some plans use a “debit card” approach).
In light of today’s financial stresses, employers who show a strong commitment to the wellbeing of their employees are seen in a more positive light. LSAs let employers get creative, offering a benefit that people value because it is personally relevant to them. And that encourages them to stay.